TMI Blog2023 (1) TMI 576X X X X Extracts X X X X X X X X Extracts X X X X ..... roject officers are also appointed by the U.P. government. DUDA utilizes the fund which is released by the SUDA - Further, as per website of Pradhan Mantri Awas Yojana-Housing for All (Urban), Ministry of Housing and Urban Affairs, the PMAY is a Scheme to provide central assistance to Urban Local Bodies (ULBs) and other implementing agencies through States/UTs for Rehabilitation of existing slum dwellers using their land as a resource through private, participation, and affordable Housing in Partnership. As per the details available on website SUDA is the state level nodal agency for PMAY(U) in the state of Uttar Pradesh. Functions entrusted to Panchayats/Municipalities - HELD THAT:- The Consultancy services rendered by the Applicant under the contract with DUDA, and for PMAY are in relation to functions entrusted to Municipalities/Panchayats under Article 243W / 243G of the Constitution of India. Whether such services provided by the Applicant would qualify as Pure services? - HELD THAT:- The services mentioned in the contract would qualify as Pure Service (excluding works contract service or other composite supplies involving supply of any goods) as provided in serial n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y 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 243 W of the Constitution, as provided in serial number 3 of Notification No. 12/2017-Central Tax (Rate) dated 28 June, 2017, as amended (S. No. 3A) by Notification No. 2/2018- Central Tax (Rate) dated 25 January, 2018 issued under Central Goods and Services Tax Act, 2017 (CGST') and corresponding Notifications No. KA.N.I.-2-843/X1- 9 (47) / 17-UP. Act-1 - 2017 - Order - (10) - 2017 Lucknow, dated June 30, 2017 issued under Uttar Pradesh Goods and Service Tax Act, 2017 ('UPGST Act'), where the Project cost includes the cost of service rendered along with reimbursement of cost of procurement of goods for rendering such service, and, thus, be eligible for exemption from levy of CGST and UPGST, respectively. 4. As per the declaration given by the applicant in Form ARA-01, the issue raised by the applicant is neither pending in any proceedings nor decided in any proceedings in the applicant's case under any of the provisions of the CG ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all eligible urban households by the year 2022, when Nation completes 75 years of its Independence through following programme verticals :- Slum rehabilitations of slum dwellers with participation of private developers using land as a resource Promotion of affordable housing for weaker section through credit linked subsidy Affordable housing in partnership with Public and Private sectors Subsidy for Beneficiary- Led individual house construction (5) District Urban Development Agency (DUDA), is organizational extension of SUDA in various Districts of Uttar Pradesh. DUDA works on same lines of objectives in a district on which SUDA works in the entire state of Uttar Pradesh. (6) Principal Secretary U.P. Govt, wrote a letter to Director SUDA vide its Letter No. 483/2018/1584/69-l-2018-14(139)/2015 TC Dated 04-09-2018 to provide instructions to District Magistrates to choose an agency as per the list of agencies mentioned in the said letter, or any New Agency by the District Magistrate/Authorized Officer for Preparation of Detailed Project Report and providing Project Management Consultancy Service under Pradhan Mantri Awas Yojna (PMAY) in their dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on which SUDA works in the entire state of Uttar Pradesh. . As per the Memorandum of Association of District Urban Development Agency Gorakhpur , it's main objectives shall be- (a) To identify the urban poor in the District. (b) To draw up plans and formulate schemes for the upliftment of the urban poor in the District. (c) To implement schemes for the benefit of the urban poor either directly or through other agencies engaged in this direction, whether private, public or cooperative. (d) To review the progress of the execution of these activities as well as effectiveness of the benefits directed towards the urban poor. (e) To set up or establish any specific service such as training facilities, infrastructural etc. in furtherance of the economic interest of the urban poor. (12) Further, Pradhan Mantri Awas Yojana -Housing for All (Urban), Ministry of Housing and Urban Affairs, the PMAY is a Scheme to provide central assistance to Urban Local Bodies (ULBs) and other implementing agencies through States/UTs for Rehabilitation of existing slum dwellers using their land as a resource through private, participation, and affordable Housing in Partners ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... truction work to ensure adherence to the drawings, prescribed high standards of quality and timely completion of the project and verify and certify the progress of the work. Preparation of Physical and Financial progress and shall submit to respective ULBs and DUDA. Preparation of individual files consist of application, copy of Aadhar Card, bank details, land documents, consent letters etc, stage wise photographs for every beneficiaries. PMC will assist Beneficiaries at various stages such as Plinth Level, Lintel Level, roof level and final finishing works and assist to get timely installments. PMC will make sure that the project/ DUs construction must complete as per the agreement made with the beneficiaries for the successful and timely implementation of the Project. PMC will implement GEO tagging of constructions of all the stages. Time extension will not be considered except in very exceptional cases without prejudice to levy of penalties. However any approval for extension of time of completion of the works stipulated in the construction, beneficiaries will be without any additional financial implication. PMC shall be fully responsible for q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of Municipality as laid down under section 243W of the Constitution of India are:- Subject to the provisions of this Constitution, the Legislature of a State may, by law, endow,- (a) the Municipalities with such powers and authority as may be necessary to enable them to function as institutions of self government and such law may contain provisions for the devolution of powers and responsibilities upon Municipalities, subject to such conditions as may be specified therein, with respect to,- (i) the preparation of plans for economic development and social justice; (ii) the performance of functions and the implementation of schemes as may be entrusted to them including those in relation to the matters listed in the Twelfth Schedule; (b) the Committees with such powers and authority as may be necessary to enable them to carry out the responsibilities conferred upon them including those in relation to the matters listed in the Twelfth Schedule. (3) According to foregoing discussions it may be construed that the Consultancy services rendered i.e. DPR and PMC under the contract with District Urban Development Agency, Gorakhpur (DUDA) as per scope of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under PMC, this may be clearly opined that such services provided would qualify as 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 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 as provided in serial number 3 of Notification No. 12/2017- Central Tax (Rate) dated 28 June, 2017, as amended (S. No. 3A) by Notification No. 2/2018-Central Tax (Rate) dated 25 January, 2018 issued under Central Goods and Services Tax Act, 2017 ('CGST') and corresponding Notifications No. KA.N.I.-2-843/X1-9 (47) / 17-UP. Act-1 - 2017 - Order - (10) - 2017 Lucknow, dated June 30, 2017 issued under Uttar Pradesh Goods and Service Tax Act, 2017 ('UPGST Act'), where the Project cost includes the cost of service rendered along with reimbursement of cost of procurement of goods for rendering such service and, thus, be eligible for exemption from levy of C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is prayed before the Honorable Members of the Authority for advance ruling AAR to provide the rulings on the questions rose through this application to exempt the GST in the hands of applicant in case of DPR and PMCs provided to DUDA/SUDA. 7. The application for advance ruling was forwarded to the Jurisdictional GST Officer to offer his comments/views/verification report on the matter. The Dy./Assistant Commissioner, CGST Central Excise Division-1, Lucknow offered no comments on the questions raised by the applicant. 8. The applicant was granted a personal hearing in the matter. In compliance, Shri Pankaj Shukla, Chartered Accountant Authorized representative, attended personal hearing on 27.07.2022 on behalf of the applicant. During the personal hearing, he reiterated the submissions already made in the application of advance ruling. DISCUSSION AND FINDING 9. At the outset, we would like to make it clear that the provisions of both the CGST Act and the UPGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods and Service Tax Act, 2017 ('UPGST Act'), where the Project cost includes the cost of service rendered along with reimbursement of cost of procurement of goods for rendering such service, and, thus, be eligible for exemption from levy of CGST and UPGST, respectively. 12. We observe that-as per SI. No. 3 of Notification No. 12/2017-CT (Rate) dated 28.06.2017 ''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 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 243 W of the Constitution are exempt from tax. 13. We observe that SUDA has been established as a state level nodal agency, under the department for Urban Employment and Poverty Alleviation by Uttar Pradesh Government. As per the Memorandum of Association of State Urban Development Agency , its main objectives shall be- (a) To identify the urban poor in the state. (b) To draw up pla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the District Magistrate of the district concerned will be the ex-officio chairman of DUDA. Project director and project officers are also appointed by the U.P. government. DUDA utilizes the fund which is released by the SUDA. 17. Further, as per website of Pradhan Mantri Awas Yojana-Housing for All (Urban), Ministry of Housing and Urban Affairs, the PMAY is a Scheme to provide central assistance to Urban Local Bodies (ULBs) and other implementing agencies through States/UTs for Rehabilitation of existing slum dwellers using their land as a resource through private, participation, and affordable Housing in Partnership. As per the details available on website SUDA is the state level nodal agency for PMAY(U) in the state of Uttar Pradesh. 18. Now coming to the functions entrusted to Panchayats/Municipalities, the matters listed in the 11th and 12th schedule to the constitution (details 243G and 243W, respectively), are inter alia: (a) Safe water for drinking, (b) Maintenance of community assets, (c) Family welfare, (d) Markets and Fairs, (e) Poverty Alleviation Programmes, (f) Regulation of land use and construction of land buildings, (g) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PMC will coordinate, execute and monitor the activities leading to the construction of approved DUs by Govt, of India. All the activities till the completion of DUs will be taken care of by PMC. PMC shall also administer the works by the beneficiaries and ensure that the agreement between the ULBs and Beneficiaries whether related to quality or quantities of works are executed in accordance with its provisions. PMC shall attach Beneficiaries to the project in PMAYMIS and also upload Annexure 7C/7D/7E. PMC shall execute all MIS related work of PMAY (U). PMC will supervise the construction work to ensure adherence to the drawings, prescribed high standards of quality and timely completion of the project and verify and certify the progress of the work. Preparation of Physical and Financial progress and shall submit to respective ULBs and DUDA Preparation of individual files consist of application, copy of Aadhar card, bank details, land documents, consent letters etc, stage wise photographs for every beneficiaries. PMC will assist Beneficiaries at various stages such as Plinth Level, Lintel Level, roof level and final finishing works and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2017 issued under Uttar Pradesh Goods and Service Tax Act, 2017 ('UPGST Act'). 22. We find that in an identical matter, the Appellate Authority of Advance Ruling, Uttar Pradesh vide Appeal Order No. 17/AAAR/02/7/2021 dated 02.07.2021 has held as under- In view of above discussion, we hold that the Services rendered by the appellant to the State Urban Development Agency, Uttar Pradesh (SUDA), and for PMAY are in relation to functions entrusted to Municipalities under Article 243 W and to Panchayats under Article 243G of the Constitution of India and such services would qualify as Pure Service (excluding works contract service or other composite supplies involving supply of any goods) . 23. In view of the above, both the members unanimously rule as under; RULING Question 1- Whether the Project Development Service (i.e. Detailed Project Report Service and Project Management Consultancy services ('PMCS') provided by the applicant to the recipient under the Contract from District Urban Development Agency (herein after referred as DUDA ) which is District Level Agency of State Urban Development Agency (SUDA) and the Project Management Consultancy ser ..... X X X X Extracts X X X X X X X X Extracts X X X X
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