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2022 (5) TMI 1135 - AAAR - GSTBenefit of exemption from GST - Supply or not - definition of business u/s 2(17) - activities carried out by the appellant to the plot holders in terms of provisions of GIDC Act, 1962 - charges collected for the same as may be notified from time to time amounts to supply under Section 7 of the CGST Act, 2017 or not - Government entity - Sr.No.4 of N/N. 12/2017-Central Tax (Rate) dated 28.06.2017 (as amended) - HELD THAT:- From the definition u/s 2(17) , it is seen that as per provision (a), activities mentioned therein would fall in category of business even if they are not for a pecuniary benefit. A transaction which is incidental or ancillary to sub-clause (a) falls under the scope of sub-clause (b) of Section 2(17) of CGST Act, 2017. Further, provision (i) which states any activity or transaction undertaken by Central Government, State Government or local authorities in which they are engaged as public authorities. The appellant has been established by the Legislature of Gujarat under the act and performs its functions in accordance with provisions contained in the Act. The appellant fulfills the first condition mentioned above. Further, Section 4 of GID Act defines the constitution of the appellant wherein it has been stated that the appellant consists of 12(twelve) directors out of which 3(three) shall be nominated by the State Government. Further, 6(six) directors would be nominated by State Government from amongst persons appearing to it. As per Section 4(2) of GID Act, the State Government shall appoint one director as Chairman and one as Vice-Chairman - the appellant is wholly owned corporation of the State Government and the State Government controls the function of appellant directly or indirectly. Thus, the second condition which is “90% or more participation of Government, by way of equity or control” is fulfilled by the appellant. The activities viz. upliftment of oppressed people by providing them proper shelters, easy loans for business, encouraging their children for study by providing them scholarships etc are covered in “planning for economic and social development”. We are of view that the activity of appellant i.e. establishment, organization and development of industries and industrial areas and estates is not at all related to entry at Sr.No.3 of XII schedule of the Constitution of India. The appellant is not eligible to claim exemption under Sr.No.4 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 (as amended) as they are not a governmental authority carrying out function entrusted to a municipality under article 243 W of the Constitution - the appellant does not fall under the category of ‘State Government’ and also their functions are not covered under Twelfth Schedule of Article 243W of the Constitution. They are therefore not eligible for exemption benefit under Notification No.14/2017-Central Tax (Rate) dated 28.06.2017. The appellant does not fall under the category of ‘State Government’ but is covered under the category ‘Government Entity’.
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