TMI BlogClarifications regarding applicable GST rates and exemptions on certain servicesX X X X Extracts X X X X X X X X Extracts X X X X ..... Sl. No. 9B of Notification No. 12/2017-State Tax (Rate), dated June 30, 2017 covers services associated with transit cargo both to and from Nepal and Bhutan ; 5. Applicability of GST on sanitation and conservancy services supplied to Army and other Central and State Government departments ; 6. Whether the activity of selling of space for advertisement in souvenirs is eligible for concessional rate of five per cent. ; 7. Taxability and applicable rate of GST on transport of minerals from mining pit head to railway siding, beneficiation plant, etc., by vehicles deployed with driver for a specific duration of time ; 8. Whether location charges or preferential location charges (PLC) collected in addition to the lease premium for long term lease of land constitute part of the lease premium or up front amount charged for long term lease of land and are eligible for the same tax treatment ; 9. Applicability of GST on payment of honorarium to the guest anchors ; 10. Whether the additional toll fees collected in the form of higher toll charges from vehicles not having fastag is exempt from GST ; 11. Applicability of GST on services in the form of Assisted Reproductive T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect from October 6, 2021, the ice cream parlours are required to pay GST on supply of ice-cream at the rate of 18 per cent. with ITC. 4. Applicability of GST on application fee charged for entrance or the fee charged for issuance of eligibility certificate for admission or for issuance of migration certificate by educational institutions 4.1 Representations have been received regarding applicability of GST on application fee charged for entrance or the fee charged for issuance of eligibility certificate for admission or for issuance of migration certificate by educational institutions. 4.2 In this regard, it is stated that educational services supplied by educational institutions to its students are exempt from GST vide entry 66 of Notification No. 12/2017-State Tax (Rate), dated June 30, 2017 relevant portion of which reads as under : Services provided (a) by an educational institution to its students, faculty and staff ; (aa) by an educational institution by way of conduct of entrance examination against consideration in the form of entrance fee ; . . . 4.3 Therefore, it can be seen that all services supplied by an educational institution to its student ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be rawer form of cotton fibre obtained from cotton-with-seeds plucked from cotton plants. 5.3 Accordingly, it is clarified that service by way of storage or warehousing of cotton in ginned and or baled form was covered under entry 24B of Notification No. 12/2017-State Tax (Rate), dated June 30, 2017 in the category of raw vegetable fibres such as cotton. It may however be noted that this exemption has been withdrawn with effect from July 18, 2022. 6. Whether exemption under Sl. No. 9B of Notification No. 12/2017-State Tax (Rate), dated June 30, 2017 covers services associated with transit cargo both to and from Nepal and Bhutan. 6.1 Representations have been received regarding applicability of GST on transportation of empty containers returning from Nepal and Bhutan after delivery of transit cargo, to India. 6.2 GST on supply of services associated with transit cargo to Nepal and Bhutan was exempted with effect from September 29, 2017 based on recommendations of the 20th GST Council Meeting. The opening sentence of the agenda item 7(ix) placed before the GST council on this issue, makes it clear that the proposal was to exempt supply of services associated with transi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conservancy services supplied to Army and other Central and State Government Departments 7.1 Representations have been received regarding taxability of sanitation and conservancy services supplied to army and other Central and State Government Departments. 7.2 Municipalities and Panchayats and other local authorities such as Cantonment Boards listed in section 2(69) of the Delhi Goods and Services Tax Act, 2017 carry out functions entrusted to them under articles 243W and 243G of the Constitution respectively. Functions that may be entrusted to panchayats and municipalities are listed in Schedules 11 and 12 of the Constitution. Central Government, State Governments and Union Territories also perform functions listed in Schedules 11 and 12 such as irrigation, public health, etc. 7.3 Services by Central Government, State Government, Union Territory or any local authority by way of any activity in relation to a function entrusted to a Panchayat under article 243G of the constitution or to a municipality under article 243W of the Constitution have been declared as neither a supply of goods nor a supply of services vide Notification No.14/2017-State Tax (Rate), dated June 30, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1/2017-State Tax (Rate) and attracts GST at five per cent. 9. Taxability and applicable rate of GST on transport of minerals from mining pit head to railway siding, beneficiation plant, etc., by vehicles deployed with driver for a specific duration of time. 9.1 Representations have been received to clarify the taxability of transport of minerals within a mining area, say from mining pit head to railway siding, beneficiation plant, etc., by vehicles deployed with driver for a specific duration of time and whether the same would be covered under Sl. No. 18 of Notification No. 12/2017-State Tax (Rate), dated June 30, 2017 which exempts transport of goods by road except by a GTA. 9.2 Usually in such cases the vehicles such as tippers, dumpers, loader, trucks, etc., are given on hire to the mining lease operator. Expenses for fuel are generally borne by the recipient of service. The vehicles with driver are at the disposal of the mining lease operator for transport of minerals within the mine area (mining pit to railway siding, beneficiation plant, etc.) as per his requirement during the period of contract. 9.3 Such services are nothing but rental services of transport vehi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overnment, Union territory to the industrial units or the developers in any industrial or financial business area , is exempt from GST. 10.3 Allowing choice of location of plot is integral part of supply of long-term lease of plot and therefore, location charge is nothing but part of consideration charged for long term lease of plot. Being charged up front along with the up front amount for the lease, the same is exempt. 10.4 Accordingly, as per recommendation of the GST council, it is clarified that location charges or preferential location charges (PLC) paid up-front in addition to the lease premium for long term lease of land constitute part of up-front amount charged for long term lease of land and are eligible for the same tax treatment, and thus eligible for exemption under Sl. No. 41 of Notification No. 12/2017-State Tax (Rate), dated June 30, 2017. 11. Applicability of GST on payment of honorarium to the Guest Anchors 11.1 Representation has been received regarding applicability of GST on honorarium paid to Guest Anchors. Sansad TV and other TV channels invite guest anchors for participating in their shows and pays remuneration to them in the form of honorarium. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Assisted Reproductive Technology (ART) procedures such as In vitro fertilization (IVF). 13.2 Health care services provided by a clinical establishment, an authorized medical practitioner or para-medics are exempt. (Sl. No. 74 of Notification No. 12/2017-State Tax (Rate), dated June 30, 2017. 13.3 Health care services is defined vide 2(zg) of Notification No. 12/2017-State Tax (Rate), dated June 30, 2017 as health care services means any service by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognised system of medicines in India and includes services by way of transportation of the patient to and from a clinical establishment, but does not include hair transplant or cosmetic or plastic surgery, except when undertaken to restore or to reconstruct anatomy or functions of body affected due to congenital defects, developmental abnormalities, injury or trauma. 13.4 The abnormality/disease/ailment of infertility is treated using ART procedure such as IVF. It is clarified that services by way of IVF are also covered under the definition of health care services for the purpose of above exemption notification. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l, it is clarified that where the body corporate hires the motor vehicle (for transport of employees, etc.) for a period of time, during which the motor vehicle shall be at the disposal of the body corporate, the service would fall under Heading 9966, and the body corporate shall be liable to pay GST on the same under RCM. It may be seen that reverse charge thus would apply on act of renting of vehicles by body corporate and in such a case, it is for the body corporate to use in the manner as it likes subject to agreement with the person providing vehicle on rent. 15.7 However, where the body corporate avails the passenger transport service for specific journeys or voyages and does not take vehicle on rent for any particular period of time, the service would fall under Heading 9964 and the body corporate shall not be liable to pay GST on the same under RCM. 16. Whether hiring of vehicles by firms for transportation of their employees to and from work is exempt under Sl. No. 15(b) of Notification No. 12/2017-State Tax (Rate) transport of passengers by non-air conditioned contract carriage 16.1 Representations have been received to clarify whether the engagement of non-air c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndling system, machinery or equipment for units processing agricultural produce as food stuff excluding alcoholic beverages. 17.3 In this regard, it may be seen that prior to July 18, 2022. serial number 3(v)(f) of Notification No. 11/2017-State Tax (Rate), dated June 30, 2017 prescribes GST rate of 12 per cent. on the composite supply of works contract by way of construction, erection, commissioning, or installation of original works pertaining to mechanized food grain handling system, machinery or equipment for units processing agricultural produce as food stuff excluding alcoholic beverages. 17.4 It is clarified that a contract of the nature described here for construction, installation and commissioning of a dairy plant constitutes supply of works contract. There is no doubt that dairy plant which comes into existence as a result of such contracts is an immovable property. 17.5 It is also clarified that such works contract services were eligible for concessional rate of 12 per cent. GST under serial number 3(v)(f) of Notification No. 11/2017-State Tax (Rate), dated June 30, 2017 prior to July 18, 2022. With effect from July 18, 2022, such works contract services would ..... X X X X Extracts X X X X X X X X Extracts X X X X
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