TMI Blog2022 (4) TMI 1132X X X X Extracts X X X X X X X X Extracts X X X X ..... Pure services (excluding works contract service or other composite supplies involving supply of any goods) 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 2430 of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution. To avail the benefit of the provisions of above said notification, two conditions of the notification has to be fulfilled in letter and spirit, first one being that the receiver Of services should be the Central Government, State Government or Union territory or local authority or a Governmental authority 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 and the second one being that the service provided should be either be a Pure services or Composite supply of goods and services in which the value of supply of goods constitutes not more than 25 per cent. O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the Jurisdictional Officer : None Note : An appeal against this ruling lies before the appellate authority for advance ruling under Section 100(1) of the Uttarakhand Goods and Services Tax Act, 2017, constituted under Section 99 of the Uttarakhand Goods and Services Tax Act, 2017, within a period of 30 days from the date of service of this order. PROCEEDINGS 1. This is an application under Sub-Section (1) of Section 97 of the Central Goods ervice Tax Act, 2017 and Uttarakhand State Goods Service Tax Act, 2017 (hereinafter referred to as CGST/SGST Act) and the rules made there under filed by M/s. Divisional Forest Office, Bageshwar, Forest Compound, Kathayatbara, Bageshwar (Uttarakhand)- 263645, (herein after referred to as the applicant ), a corporate body (LLP) and registered with GSTIN- 05AAALD1881A1ZR under the CGST Act, 2017 read with the provisions of the UGGST Act, 2017 (hereinafter referred to as the applicant ). 2. In the application dated 24.12.2021, the applicant submitted that: 1. They are a division of Forest Department of State Government of Uttarakhand and registered with GSTIN-05AAALD1881A1ZR in Uttarakhand and engaged in variou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of labour services for collection of seeds from forest, digging contour trenches, chal-khal (water conservation pits in hills) for soil and moisture conservation, clearing of fire lines in forest to protect forest from fire which causes damage to forest, controlled burning of portion of forest to prevent spread of fire and damage to environment in included in exempted services in Notification No. 12/2017 Central Tax (Rate ) dated 28-06-2017 or any other related exemption notification. 2. If above supply of service is not included in any exemption notifications as per Question 1, the rate of goods and service tax applicable to such supply of services. 3. Whether the supply of services for raising seedlings in nursery is exempted services in Notification No. 12/2017 Central Tax (Rate) dated 28-06-2017 or any other related exemption notification. 4. If above supply of service is not included in any exemption notifications as per Question 3, the rate of goods and service tax applicable to such supply of services. 5. Whether the supply of services for plantation in forest is exempted services in Notification No. 12/2017 Central Tax (Rate) dated 28-06-2017 or any other rela ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods or services or both, (d) Admissibility of input tax credit of tax paid or deemed to have been paid (e) Determination of the liability to pay tax on any goods or services or both (f) Whether the applicant is required to be registered (g) Whether any particular thing done by the applicant with respect to any goods or services or both amounts to or results in a supply of goods or services or both within the meaning of that term. 6.2 In the present case applicant has sought advance ruling on Applicability of a notification issued under the provisions of this Act, therefore, in terms of said section 97 (2) the present application is hereby admitted. 7. Accordingly opportunity of personal hearing was granted to the applicant on 14.03.2022. Mr. Himanshu Bagri, Divisional Forest Officer, Bageshwar, on behalf of the applicant appeared for personal hearing on the said date and re-iterated the submission already made in their application. Ms. Preeti Manral, Deputy Commissioner, SGST-Dehradun, Concerned Officer from State Authority was also present during the hearing proceedings. She presented her facts and requested the authority to decide the case on mer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Moisture Conservation is exempted services in Notification No. 12/2017 Central Tax (Rate) dated 28-06-2017 or any other related exemption notification. 8. If above supply of service is not included in any exemption notifications as per Question 7, the rate of goods and service tax applicable to such supply of services. 9. The section 51 of the CGST specifies that TDS is to be deducted when total value of taxable goods or services or both under a contract exceeds ₹ 2,50,000. Most the mentioned works in this application are small in nature and therefore, the value of single contract in most cases is less than ₹ 2,50,000. However, the service provider registered with the department provides services for many works like one contract for nursery, second for plantation, third for fire lines and so on. The value of all contract combined may become more than ₹ 10 Lakhs in some cases. Whether, TDS is to be deducted if applicant gives contract for multiple works to the contractor, the cumulative contract value is more than Rs However, work order of single contract is less than Rs 9. We find that the applicant in their application has contended that : 1. The Mi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f truck path in forest are pure services that are clearly falling within the purview of term Protection of Environment, Road/ Fire Services as covered in 12th Schedule under Article 243 W of the constitution. Therefore, these services are exempted as per Sl.No. 3 of the Notification No. 12/2017- Central Tax (Rate) dated 28-06-2017 10. Now we take up the case for discussion: 10.2 we find that at Sl. No. 3 of the Notification No. 12/2017- Central Tax (Rate) dated 28th June, 2017 under Chapter Head for the service code 99 exemption has been granted to Pure services (excluding works contract service or other composite supplies involving supply of any goods) 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 2430 of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution. 10.3 We further find that vide Notification No. 2/2018-C.T. (Rate), dated 25-1-2018, the Notification No. 12/2017- Central Tax (Rate) dated 28th June, 2017 has been ame ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , and in particular, of the Scheduled Castes and the Scheduled Tribes. (xxviii) Public distribution system. (xxix) Maintenance of community assets. 10.3.3 Likewise we find that vide Notification No. 12/2017- Central Tax (Rate) dated 28th June, 2017, pure services provided to the Central Government, State Government or Union territory or local authority or a Governmental authority by way of any activity in relation to any Municipality under article 243W of the Constitution, has been exempted and the functions entrusted to a municipality under the Twelfth Schedule to Article 243W of the Constitution are as under: (a) Urban planning including town planning. (b) Regulation of land-use and construction of buildings. (c) Planning for economic and social development. (d) Roads and bridges. (e) Water supply for domestic, industrial and commercial purposes. (f) Public health, sanitation conservancy and solid waste management. (g) Fire services. (h) Urban forestry, protection of the environment and promotion of ecological aspects. (i) Safeguarding the interests of weaker sections of society, including the handicapped and me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ite supply is not more than 25% of the value of the said composite supply, but has not provided any documentary evidences for their claim, even more so there is reference of digging contour trenches, chal-khal (water conservation pits in hills) for soil and moisture conservation and creation of check-dam for Soil and Moisture Conservation in their application, hence we observe that this criterion cannot be applied to each and every work/ contract, given by the applicant to the contractors by same yard stick, and hence each and every contract for Composite supply of goods and services has to be examined individually, for ascertaining the eligibility of exemption Notification No. 12/2017- Central Tax (Rate) dated 28th June, 2017. 10.6 In view of the above provisions of the Act, we hold that the in relation to the nature of works cited at SI. 1, 3, 5 and 7 of Para 3 above, the benefit of exemption Notification No. 12/2017- Central Tax (Rate) dated 28th June, 2017, is available only if the contract is either for pure service or for Composite supply of goods and services in which the value of supply of goods constitutes not more than 25% of the value of the said composite supply ..... 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