Home Case Index All Cases GST GST + AAR GST - 2022 (6) TMI AAR This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (6) TMI 756 - AAR - GSTClassification of supply - Supply of goods or services - composite supply - activities undertaken for implementing various construction/ repair/ renovation/ addition/ alteration projects by GMVN Ltd. for Central Government, State Government, Local Authority or Governmental Authority the consideration for which is received in the form of grants - exemption from GST or not - applicability of N/N. 12/2017- Central Tax (Rate) (As amended) dated the 28th June, 2017 - HELD THAT:- The applicant has received payment for execution of a specific work i.e. the type and scope of the work is predetermined, hence, we hold that money transferred by the Government into the accounts of the applicant in the form of grant is a "consideration" under the provision of CGST Act, 2017, consequently the activity undertaken by the applicant for the State/Central Government or local authority amount to supply as defined in section 7 of the CGST Act, 2017 - the applicant in their application under reference has accepted on their own that the amount received is consideration, the activity undertaken by them for the Government amount to Supply as defined in section 7 of the CGS Act, 2017 and that the work undertaken is a service and hence not under dispute. Whether the works referred to in by the applicant is supply of goods or supply of services? - HELD THAT:- It is found from the definition of scope of supply, Composite supply and works contract and the terms of reference appearing in the work allocated to the applicant namely "construction of 'Shaheed Dwaf at Banjarawala, Dehradun" and "construction of 'Creation of barrier free environment for PWDs and tourist rest houses in various district of Uttarakhand State', involves civil construction work viz. construction, repairs, etc. and hence falls under the definition of works contract service - on the basis of the two works contract, generalized view cannot be in respect of to any other work/ contract, by applying the same yard stick. Applicability of GST on the grants - HELD THAT:- By virtue of Notification No. 12/2017-CT (Rate) dated 28.06.2017 any supply of services by a Government Entity to Central Government, State Government' Union territory, local authority or any person specified by Central Government, State Government, Union territory or local authority is exempt from payment of GST, if the consideration received from Central Government, State Government, Union Territory or local authority, is in the form of grants. We find that from the wordings of the said notification it is clear that exemption is available, only, if the consideration received is in the form of grants and has to be utilized for the intended purpose only. The litmus test in such cases would be the character of the consideration and if it qualifies to be a grant then and only then the benefit under the provisions of Notification No. 12/2017-CT (Rate) dated 28.06.2017, is available. In the instant case it is found that in the letter No. 41/VI/2021-80(51) 2020 of the Secretary, Uttarakhand Government the word 'Anudaan' at Para 16 and in the letter dated 16.09.202, Department of Empowerment of Persons with Disabilities (Divyangjan), Ministry of Social Justice and Empowerment, GOI, Para 3 specifies that 'Purpose for which this grant is sanctioned: - creation of barrier free environment for PwDs in 44 No. Tourist Rest House in 07 Districts of Uttarakhand State under administrative charge of GMVNL, Dehradun under the SIPDA scheme during 2020-21" , establish that the consideration is in the form of grants and hence, it is held that the benefit of exemption Notification No. 12/2017-CT(Rate) dated 28.06.2017 is available to the applicant in respect of these two works.
|