TMI Blog2020 (3) TMI 444X X X X Extracts X X X X X X X X Extracts X X X X ..... e. The Applicant claims that the service received from M/s. Primeone work force private limited does not involve supply of any goods while provisioning the services. Thus services are therefore, classifiable as pure service. The Government of Madhya Pradesh is having full control over the applicant M/S M.P. Paschim Kshetra Vidyut Vitran Co. Ltd. and the applicant is covered under the definition of Government Entity. The work entrusted to the applicant as mentioned above is covered under the article 243G of the constitution as the function entrusted to the Panchayat i.e., Rural Electrification including distribution of Electricity. However, the applicant work is not covered under Article 243W of the constitution as the function entrusted to the municipality. It is concluded that the services received by the applicant from M/s. Primeone work force Pvt. Limited fulfills the requisite criteria mentioned in S. No. 3 of the notification no. 12/2017 - Central Tax (Rate), Dated - 28/06/2017 as amended from time to time and eligible for claiming benefit available under the said provision. But the benefit can be availed only in case of where services mentioned in S. No. 3 is receive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Concerned Officer is of the view that the work for which the applicant has asked clarification comes under category of exempted service. 6. RECORD OF PERSONAL HEARING - Shri Anirudh Tiwari, Accounts Officer appeared for personal hearing on and they reiterated the submission already made in the application and attached additional submission which goes as follows - 6.1 The Company Madhya Pradesh Paschim Kshetra Vidyut Vitaran company Ltd. (MPPKVVCL) is wholly owned subsidiary of M.P. Power management Co. Ltd. 6.2 The holding Company M.P. Power management Co. ltd. Is wholly owned by the Government of Madhya Pradesh. 6.3 Thus, the Government of Madhya Pradesh is having full control over MPPKVVCL and covers under Government Entity. 6.4 Further, the Government of Madhya Pradesh has entrusted the Company to carry out function of supply and distribution of Electricity in the area of Indore and Ujjain Commissionerate vide order no. 5555/RS/4/13/2001, Bhopal, Dated - 01/07/2002. 6.5 The Government of India, vide notification no. 12/2017 - Central Tax (Rate), Dated - 28th June 2017 notify the exempted services. Under this notification at S.no. 3 Pure Service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e words a Governmental Authority the words or a Government Entity shall be inserted; (b) Inserting entry no. (3A) notified NIL GST rate for Composite supply of goods and services in which the value of supply of goods constitutes not more than 25 per cent of the value of the said composite supply provided to the Central Government, State Government or Union territory or local authority or a Governmental authority or a Government Entity by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution. 6.9 In view of above, it is submitted that the provision referred above issued under notification no. 12/2017 - Central Tax (Rate), Dated - 28/06/2017 as amended by Notification No. - 32/2017 - Central Tax (Rate), Dated - 13/10/2017 and Notification No. 02/2018 - Central Tax (Rate), Dated - 25/01/2018 is applicable on the Manpower services (Pure Services) received by the Company from M/s. Primeone Work Force Private Limited. 7. DISCUSSIONS AND FINDINGS 7.1 A careful reading of conditions laid down under the Exempt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .6 Thus, based on the above facts, it is concluded that the Government of Madhya Pradesh is having full control over the applicant M/S M.P. Paschim Kshetra Vidyut Vitran Co. Ltd. and the applicant is covered under the definition of Government Entity. 7.7 Before deciding the applicability of Sl No. 3 of the Exemption Notification, the functions of a Panchayat or a Municipality under the Constitution needs to be discussed. Article 243G of the Constitution discusses the Powers, authority and responsibilities of Panchayats, stating that Subject to the provisions of this Constitution the Legislature of a State may, by law, endow the Panchayats with such powers and authority and may be necessary to enable them to function as institutions of self-government .. subject to such conditions as may be specified therein, with respect to... ....(b) the implementation of schemes for economic development and social justice as may be entrusted to them including those in relation to the matters listed in the Eleventh Schedule 1. Agriculture including agricultural expansion 2. Land improvement, implementation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7.8 Now it is important to discuss the nature of work entrusted to the applicant. The applicant is entrusted for distribution of electricity in the commissionaires region of Indore and Ujjain. The applicant also carried out electrification work to develop distribution network for supply of electricity in the above region. 7.9 The work entrusted to the applicant as mentioned above is covered under the article 243G of the constitution as the function entrusted to the Panchayat i.e., Rural Electrification including distribution of Electricity. However, the applicant work is not covered under Article 243W of the constitution as the function entrusted to the municipality. 7.10 In view of above, it is concluded that the services received by the applicant from M/s. Primeone work force Pvt. Limited fulfills the requisite criteria mentioned in S. No. 3 of the notification no. 12/2017 - Central Tax (Rate), Dated - 28/06/2017 as amended from time to time and eligible for claiming benefit available under the said provision. But the benefit can be availed only in case of where services mentioned in S. No. 3 is received in area covered under Panchayat limits as the entrusted work ..... 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