Date of order: 10-08-2022

Facts: 

• The applicant, M/s. Iron Triangle Ltd in JV with Krishna Corporation Pvt. Ltd. is a consortium being formed for carrying out design and construction of roads and services on EPC Basis.
• The applicant has received a contract from Mandal Becharaji Special Investment Regional Development Authority at a price of Rs. 4,98.88,00,000/- to carry out the design and construction of roads and services of TP-l Area as per Schedule A and B together with Project Facilities as specified in Schedule C and in conformity with the Specifications and Standards set out in Schedule D.

Issue:

• Whether supply of design and construction of Roads and Services on EPC basis wherein both goods and services are supplied can be construed to be a Composite Supply of Works Contract in terms of Section 2(ll9) and section 2(30) of the CGST Act,2017?

Order:

• The authorities observed that MBSIRDA is constituted under Sub-section (1) of Section 8 and every Regional Development Authority constituted under sub-section (l) of Section shall be a body corporate in terms of Sub-section (2) of Section 8.
• Further, TP road and other utility services viz. drinking water supply systems, recycled water supply, sewage collection systems, industrial waste collection systems, and storm water drainage networks are not inherently bundled services and are not provided in combination with each other. Actually road construction and other utility services in the TP-1 area are independent work contract services with each other. Therefore, the applicant services are not composite supply in terms of Section 2(30) of the CGST Act.
• The applicant service of construction of other Utility Service involves components of goods and services, therefore covers under the category of Work Contract service and are liable to GST 18%, w.e.f. 18 July 2022 and prior to that @12%.