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2019 (10) TMI 569 - AAR - GSTLiability for deduction of GST TDS - payments made to suppliers - whether the applicant falls under any of the categories of the persons mandated to undertake TDS deduction, under Section 51(1) of the CGST Act 2017? HELD THAT:- The applicant entity was formed and registered under Co-operative Society Act 1959, where the District Co-operative Milk Unions are shareholders of the applicant organisation. Further applicant is a taxable person under the GST Acts and the entire shareholding is with the district milk unions and not with the State Government of any State or the Central Government or any local authority. Hence it is not a department or an establishment of Central Government/State Government/local authority. Therefore applicant is not covered under clause (a) & (b) of Section 51(1) of the CGST Act, 2017. The applicant is a co-operative society registered under the Karnataka Co-operative Societies Act, 1959 and the applicant states that they are not registered under Societies Act, 1860. Hence the applicant is not a notified person under clause (d) of section 51(1). Clause (c) of the Section 51(1) of the CGST Act 2017 - whether the applicant is covered under “Governmental Agency” or not? - HELD THAT:- “Governmental agency” has not been defined under the CGST Act 2017 or any other notifications. Governmental Agencies are usually administrative units of government that are tasked with specific responsibilities - In the instant case the applicant has not been established by national, regional or local governments but is registered under Co-operative Society Act 1959, which mandates certain supervisory / participation from the relevant Department of Karnataka State Government. The applicant has not been tasked with any responsibilities by the Government of Karnataka. The Directors have been nominated only to safeguard the funds of the said society. Therefore the applicant is not covered under clause (c) of Section 51(1) of the CGST Act 2017. Thus, the applicant is not liable to deduct tax at source as per provisions of section 51 of CGST ACT towards payments made to suppliers of taxable goods or services or both, as they are not covered under any of the clauses of Section 51(1) of the CGST/ KGST Act 2017.
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