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TMI Blog2024 (6) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... here are two methods of installing the line: (i) The entire works with material and installation is arranged by MVVNL on behalf of the customer and is carried under supervision of MVVNL. The entire cost of material and labour incurred by MVVNL is reimbursed by the customer on cost to cost basis and accordingly the net income charged by the MVVNL is supervision fee only. (ii) In the second mode the entire work with material is arranged by the customers and installation work is done by the contractors hired by the customers. In this case the role of the MVVNL is limited to supervision only for which it charges supervision fee. The supervision fee is charged @15% on the cost of material. 4. The applicant submitted that so far as the first method is concerned, wherein the entire work including arranging of material and labour is carried upon by MVVNL, Section 15 (1) & Section 15 (2) of CGST Act, 2017 would apply and GST would be applicable on entire amount charged from the customer (including material and labour claimed as reimbursement). However, the applicant seeks clarification on applicability of GST on construction/shifting of lines under the second method. The applicant see ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supplying the said goods or services or both and shall include an agent acting as such on behalf of such supplier in relation to the goods or services or both supplied" 6.2 In the present case, MVVNL is not a supplier of goods and services as per provisions of Section 2 (105) of CGST Act, 2017 as the work is being undertaken by the customer itself. There is no relationship between the customer and MVVNL which can be categorized as that of supplier and recipient except for the services of the supervising the whole work. 6.3 It is also pertinent to note that in the present transaction there is no consideration which comes under the purview of section 2 (31) of CGST Act, 2017. All the payments are being made by the customer directly to the vendor and contractors and no payment is being made to MVVNL except supervision charge for the work. 6.4 The work contract services supplied in the course of construction/ dislocation/shifting are neither supplied by nor the consideration for the same has been received by MVVNL hence there is no supply of works contract services by the Discom. 6.5 The work contract services in the present case is being supplied by an independent contractor and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng no 17/2022 dated 08/12/2022 in the case of M/s National Highways Authority of India. 7. The application for advance ruling was forwarded to Assistant Commissioner, Central Tax & Central Excise, Division-Lucknow-1 vide letter dated 16.01.2024 to offer their comments/views/verification report on the matter. No views/comments have been offered from the concerned office. 8. The applicant was granted a personal hearing on 30.01.2024 which was attended by Shri Manish Manocha, CA, the authorized representative of the applicant during which he reiterated the submissions 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 provision under the UPGST Act. Further for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act / UPGST Act would be mentioned as being under the 'CGST Act'. 10. We have gone through the Form GST ARA-01 fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtinent to note that in the present transaction there is no consideration which comes under the purview of section 2 (31) of CGST Act, 2017. All the payments are being made by the customer directly to the vendor and contractors and no payment is being made to MVVNL except supervision charge for the work. 16. The work contract services supplied in the course of construction/ dislocation/shifting are neither supplied by nor the consideration for the same has been received by MVVNL hence there is no supply of works contract services by the MVVNL. 17. In this case the ownership of the property being dislocated / shifted is vested with MVVNL, the MVVNL receives money in the form of dislocation / shutting charges. The services supplied in such cases is related to an act of tolerance with respect to such immovable property and hence covered under " agreeing the obligation to refrain from an act, or to tolerate an act or a situation , or to do an act" and are classified under SAC 999794. 18. The work contract services in the present case is being supplied by an independent contractor and is covered under SAC 9954, it is distinct service which is being supplied by a registered person oth ..... X X X X Extracts X X X X X X X X Extracts X X X X
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