Date of order: 27-06-2022

Facts:

• The applicant, M/s. Uralungal Labour Contract Co-operative Society Ltd, is primarily engaged in the construction of roads, bridges and other public infrastructure for the Government and other institutions and is an accredited agency for the Government of Kerala.
• The applicant entered into an agreement with the Director, Malabar Cancer Centre [MCC] Thalassery, Kannur established as a charitable society registered under the Societies Registration Act (21 of 1860) for the construction and extension of the site and building.
• MCC is an autonomous institution under Health and Family Welfare Department, Government of Kerala, started with an aim to establish a comprehensive cancer care centre, providing the much-required oncology care to the general public.

Issue:

• Whether the works contract service provided to Malabar Cancer Centre is to be billed at 12% GST or to be billed at 18% GST?

Order:

• It was observed by the authorities that the services provided by the applicant are for the construction and expansion of the site and building. Concessional rate of GST is applicable on supply of certain works contract services provided to Central Government or State Government or local authorities.
• The authorities observed that in Para 2 (s) of Notification No. 12/2017 Central tax (Rate) dated 28.06.2017 "clinical establishment" means a hospital, nursing home, clinic, sanatorium or any other institution by, whatever name called, that offers services or facilities requiring diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognized system of medicines in India or a place established as an independent entity or a part of an establishment to carry out diagnostic or investigative services of diseases.
• Malabar Cancer Center established and engaged in oncology care and treatment Clinical establishment falls within the above definition accordingly the work contract services provided by the applicant fall within the description mentioned in sub-item (b) of the entry above.
• Malabar Cancer Center is a Government Authority as per definition of Government Authority in Clause 4 (ix) of Central Tax (Rates) Notification No. 11/2017 dated 28.06.2017 therefore MCC is liable to GST at the rate of 12% and thereafter from 01.01.2022 shall be liable to GST at the rate of 18% as per entry in Central Tax (Rates) Notification No. SI No. 3 (xii).
• Hence, it was ruled that the works contract services provided by the applicant to Malabar Cancer Centre are liable to GST at the rate of 12% [6% - CGST+ 6% - SGST] as per entry at SI No.3 (vi) of Notification No. 11/2017 Central Tax (Rate) dated 28.06.2017 till 31.12.2021 and thereafter from 01.01.2022 onwards will be liable to GST at the rate of 18% [9% - CGST + 9%- SGST] as per entry at SI No. 3 (xii) of the Notification No. 11/2021 Central Tax (Rate) dated 28.06.2017.