Order Date – 29 January 2024

Facts –

• The Applicant, M/s. Manish Manpower Agency, are providing manpower services to Zilla Panchayat, Taluk Panchayat, Forest Department, KPTCL, Railway Department. The nature of manpower services provided are in the form of 'C' Group and 'D' Group, teachers, Data Entry Operators, Staff Nurse, Typists, Cooks, Assistant Cooks, Watchman, Cleaning Staffs etc.,

Issue –

• Whether the supply of manpower services to Zilla Panchayat and Taluka Panchayat are exempted from GST under Sl. No. 3 of the Notification No. 12/2017-Central Tax (Rate) as Pure Services?

Order –

• The AAR observed that the applicant is providing manpower services like FDA, SDA, Typists, drivers Data Entry Operator, "D" Group etc to Zilla Panchayat/Taluk Panchayat/ Social welfare department/Backward Classes Welfare Department. But these manpower services are not provided by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution. Hence provision of such manpower services is liable to tax at 18% (9% CGST and 9% SGST).
• The applicant is also providing manpower services like cleaning staff, cook, assistant cook, teachers, staff nurse and watchman to hostels and residential schools/colleges run by Social welfare department is exempted as it satisfies both the conditions mentioned under entry no. 3 of the Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017. 
• These manpower services are provided to Social welfare department which is a department of State Government. These manpower services are provided to weaker sections including scheduled caste and scheduled tribe which are in relation to the function entrusted to a Panchayat under article 243G of the constitution which is covered by 27th entry of eleventh schedule which says 'Welfare of the weaker sections, and in particular, of the Scheduled Castes and the Scheduled Tribes'.