Facts –

• The Applicant, M/s Aarav Consultancy Services Pvt. Ltd, has informed that they are engaged by Public Health Engineering Department (PHED), Chhattisgarh for preparation of detailed project report for various Gram Panchayats in the state of Chhattisgarh under Jal Jeevan Mission.

Issue – 

• Whether the survey and preparation of Detailed Project Report for water supply systems for Panchayats/ Municipalities is exempted supply?

Order – 

• The AAR held that Supply of man power provided by business entities like the applicant, not involving any supply of goods would be treated as supply of pure services also the applicant has submitted that they are providing the same to Central / State Government.
• Hence, it is clear from the documents furnished by the applicant that the provision of services of survey and preparation of Detailed Project Report for water supply systems for Panchayats/ Municipalities by the applicant through Public Health Engineering Department, Chhattisgarh, qualifies as being “Pure Services” as per the definition and the services rendered thereby being listed in article 243G of Constitution as functions pertaining to Panchayat, eligible for exemption as provided under Sr. no. 3 to Notification No. 12/2017- Central Tax (Rate) New Delhi, dated 28th June, 2017 as amended.
• With regard to TDS as per FAQ's under “TDS in GST”, in answer to Qn. 25, it further re-iterates that “No deduction is required in respect of payment against- all services which are exempted as per principal notification No.12/2017 – Central Tax (Rate) as amended from time to time”