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2018 (11) TMI 1895 - AAAR - GSTClassification of services - rate of GST - works contract - execution of project i.e. implementation of IPDS Scheme of Government of India - supply of goods and services fall within the scope and limits of Notification no. 24/2017 Central Tax (Rate) Dated 21 Sep 2017 or not - HELD THAT:- A bare reading of this Notification suggests that prime condition to avail the concessional rate of tax, is that services provided to the Central Government, State Government, Union Territory, a local authority or a governmental authority should predominantly for use other than for commerce, industry-', or any other business or profession. The Advance Ruling Authority in their decision have elaborated at length that the Case of Appellant does not fulfill the conditions laid down in Clause (a)of the said notification for availing concessional rate of tax. The Appellant in his application stated that AAR has grossly erred in passing their order on the sole ground that the services provided by the CSPDCL are commercial in nature as per their MoA. However, the rate of tax needs to be determined looking at the actual use of structure. They further stressed that the objective of the work done under question is to be looked into and not the objectives of the entity undertaking the work. It is well settled position of law that statue or notification relating to concessional rate of tax should be strictly interpreted i.e. literal rule of interpretation should be followed. In notification no. 24/2017-Central Tax (Rate), dated 21st September, 2017 in clause (a), emphasis has been given on the words " meant for use other than for commerce, industry, or any other business". The infrastructure intended to be provided by the Appellant under contract to CSPDCL will ultimately be used for distribution of electricity' and it is undeniable fact that CSPDCL collects charges as per the tariff decided for distribution of electricity which undisputedly falls within the ambit of 'Commerce' or 'business'. Therefore appellant's argument that nobody is bearing the cost of IPDS scheme does not hold water as there is no stipulation to this effect in the notification - It is also no body's case that the cost of IPDS will not be considered while fixing the tariff of electricity to be supplied in future.
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