TMI Blog2021 (1) TMI 425X X X X Extracts X X X X X X X X Extracts X X X X ..... s such, same are covered under the definition of original work , as defined inclause (zs) of the Notification No.12/2017-Central Tax (Rates) dated 28.06.2017. The Applicant has produced no evidence that the work was allotted to M/s RITES Ltd was pertaining to railways as defined at Section 2(31) of the Railway Act, 1989. There is also no evidence on record whether the work has been awarded in respect of Government railway or Non-Governmental railway . Although, the applicant has sought to infer that the said work was in respect of railways owned by Ministry of Railways, but he has not provided any supporting evidence in the form of agreement between M/s RITES Ltd and Ministry of Railways to establish the same. Therefore, in absence of any such conclusive proof that the work pertains to railways, the third condition is not satisfied. The contract work is not covered under clause no. 3(v)(a) of the Notification No.11/2017-Central Tax (Rates) dated 28.06.2017, as amended by Notification No. 20/2017-Central Tax (Rate) dated 22.08.2017. - GUJ/GAAR/R/36/2020 - - - Dated:- 3-7-2020 - SANJAY SAXENA AND MOHIT AGRAWAL, MEMBER Present for the applicant : CA Suresh Kumar Goy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sioning or installation by way of construction, erection, commissioning or installation of original works pertaining to,- (a) Railways, including monorail and metro---; shall attract reduced rate of GST@ 12% instead of normal GST applicable @18% to Works Contracts. 6. Therefore, for the purpose of applicability of clause 3(v)(a) of the Notification No.11/2017-Central Tax (Rates) dated 28.06.2017, following conditions are required to be satisfied: (a) Whether the work awarded can be covered under the definition of Works Contract as defined u/s 2(119) of the CGST Act, 2017? (b) Whether the said work can be considered as original work as mentioned in clause 3(v)(a) of the Notification No.11/2017-Central Tax (Rates) dated 28.06.2017? (c) Whether the said work can be considered as works contract pertaining to railways including monorail and metro? 7. They submitted their understanding in the light of interpretation of various relevant provisions of the CGST Act, 2017, as below: A. Whether the work awarded can be covered under the definition of Works Contract as defined u/s 2(119) of the CGST Act, 2017? A.1 As per Section 2(119) of the CGST Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... @ 12% in terms of clause 3(v)(a) of the Notification No.11/2017-Central Tax (Rates), the first two conditions i.e. the work should be works contract and it should be an original work are satisfied. Now, they can examine the third condition which requires that the work should pertain to railways, including monorail and metro. C.2 The said work has been awarded by M/s Rites Limited, which is a Public Sector Undertaking owned by the Ministry of Railways, Government of India. The work comprises of laying of track wok as per layout plan, pavement along the track, construction of admin building, warehouse and electrical/fire-fighting works. C.3 Railways has not been defined under CGST Act, 2017, therefore, it would be pertinent to refer various provisions of the Railway Act, 1989. Section 2(31) of the Railway Act, 1989 defines railways , as reproduced below: (31) railway means a railway, or any portion of a railway, for the public carriage of passengers or goods, and includes- (a) all lands within the fences or other boundary marks indicating the limits of the land appurtenant to a railway; (b) all lines of rails, sidings, or yards, or branches used for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o. 14(a) thereof? In this case, the basic thrust of argument on behalf of the Revenue is that out of two types of railway i.e. Government and Non-Government railway, benefits of Notification No. 25/2012-ST would be applicable only to Government railway. It is admitted fact that construction of railway siding would be construction of original work pertaining to railway in terms of Notification No. 25/2012-ST. It is to be observed that subject Notification No. 25/2012-ST does not differentiate between Government and Non-Government railway. Railway as per the Railway Act, 1989 inter-alia means means a railway, or any portion of a railway, for the public carriage of passengers or goods. However, Notification No. 25/2012-ST dated 20.06.2012 vide entry at S. No. 14(a) grants exemption to railways and is not restricted to railway . Even if the definition of railway is taken from the Railways Act, 1989 for interpreting said Notification, as Revenue has resorted to do, the benefit of Notification would be available to railways including railway used for purposes other than for public carriage of passengers or goods. In view of above, they rule as under: Constructio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g to Railway is more expansive and included other establishments other than Indian Railways. Hence, the contract is pertaining to Indian Railways. 4.9 There is no stipulation in said entry that this contract must be executed to the Railways but is sufficient, that it must be pertaining to Railways and the supplier and the recipient in each of the contract is immaterial. C. In the instant case, the work has been awarded by M/s Rites Limited, which is a Public Sector Undertaking owned by the Ministry of Railways, Government of India. Further, the same is covered under Section 2(31) of the Railways Act, 1989. 9. At the time of personal hearing held through Video Conferencing on 11.06.2020, the Authorised Representative of the applicant, CA Suresh Kumar Goyal reiterated the facts as stated in the Application and their additional submission dated 10.06.2020. 9.1 Further, the applicant vide their letter dated 24.06.2020 submitted that the said works contract is pertaining to Railways and the same is covered under clause 3(v)(a) of the Notification No.11/2017-Cerntral Tax(Rate) dated 28.06.2017 i.e. works contract by way of construction, erection, commissioning or inst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (a) Railways, including monorail and metro---; 14. The Contract of the applicant should satisfy the following conditions to get covered under the above entry: (i) The Contract must be a composite supply of Works Contract; (ii) The Works must be a construction, erection, commissioning or installation by way of construction, erection, commissioning or installation of original works; (iii) It must pertain to Railway. 14.1 We find that the work awarded to the applicant comprises of laying of track as per layout plan, pavement along the track, construction of Admin building, Warehouse, Electrical works and Fire-fighting works etc. at Khodiyar, Gandhinagar, Gujarat. These works are in the nature of new works to be executed. These also involve construction of original works . As such, same are covered under the definition of original work , as defined inclause (zs) of the Notification No.12/2017-Central Tax (Rates) dated 28.06.2017 and as reproduced herein belowand, hence, the second condition is satisfied. (zs) original works means- all new constructions; (i) all types of additions and alterations to abandoned or damaged structures on land that are re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... recreation; 14.3.2 Further, Section 2(20) and (25) of the Railways Act, 1989 define Government railway and Non-Governmental railway , as reproduced below: (20) Government railway means a railway owned by the Central Government; (25) non-Government railway means a railway other than a Government railway; 14.3.3 The Applicant has produced no evidence that the work was allotted to M/s RITES Ltd was pertaining to railways as defined at Section 2(31) of the Railway Act, 1989. There is also no evidence on record whether the work has been awarded in respect of Government railway or Non-Governmental railway . Although, the applicant has sought to infer that the said work was in respect of railways owned by Ministry of Railways, but he has not provided any supporting evidence in the form of agreement between M/s RITES Ltd and Ministry of Railways to establish the same. Therefore, in absence of any such conclusive proof that the work pertains to railways, we hold that third condition is not satisfied. 14. In view of the above, we hold that the contract work is not covered under clause no. 3(v)(a) of the Notification No.11/2017-Central Tax (Rates) dated 28.06.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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