In re IL & FS Education and Technology Services Limited (GST AAAR Odisha)
We notice that the Authority for Advance Ruling. Odisha, in their findings (para 5 3 of the Order)has clearly observed that OKCL was promoted by the Higher Technical education department Govt of Odisha and was incorporated under the Compares Act 1956 as a public limited company to create new paradigm in education and development through universalization and integration of Information Technology in teaching learning and educational management processes in particular and socio economic transformative processes in general OKCL can sue and be sued in its own name and capacity distinct from its owners. The Government being the Union or State Government, on other hand, can also sue and be sued, but in the name of Union of India or the Government of a State as empowered under the Article 300 of the Constitution of India. Article 300 of the Constitution of India is applicable to Government and does not apply to OKCL OKCL being a registered entity under the Companies Act 1956. Can execute all contracts in its own name and capacity . The Union or State Government can also execute contracts made in the exercise of the executive power of the Union or of a State and shall be expressed to be made by the president or by the Governor of the State under Article 299 of the Constitution of India. Article 299 of the Constitution of India does not apply to OKCL. Article 300 of the Constitution of India provides that State can sue or be sued as juristic personality in the name of Union of India and Government of a State Therefore OKCL is neither the Sate Government nor a part of the State Government of Odisha or the Central Government and therefore the supplies by the applicant to OKCL should not be held to be a supply to Government.
No counter argument has been put forth by the Appellant to substatniate their claim that the supplies were made by them to the Government. Therefor we fully agree with the finding arrived at the Advance Ruling given by the Advance Ruling (AAR), Odisha, on this point and hold so Even if some percentage of shares are owned by Government of Odisha in the OKCL. the company cannot be construed as Government. Therefore, we hold that the Appellant does not meet the primary requirement of the conditions as laid down under Entry No. 72 of Notification No.12/2017-Central Tax(Rate), dated 28.06.2017, so as to be eligible for the said exemption, as the services provided by the Appellant to OKCL cannot be construed as services provided to the Central Government, State Government or Union Territory Administration.
Also Read AAR Ruling- GST on Information & amp; Communication Technology (ICT) @ School Project
FULL TEXT OF ORDER OF APPELLATE AUTHORITY OF ADVANCE RULING, ODISHA
1.1 M/s IL & FS Education and Technology Services Ltd. (hereinafter referred to the Applicant or the Appellant”), assigned with GSTIN 21AABCI2106H1ZC, having registered address at 51-KIIT, ITI Campus-14, Chandaka Industrial Estate, Khorda. Odisha-751024. had filed an application on 27 03.2018 under Section 100(1) of CGST Act, 2017 read with Rule 104 of CGST Rules 2017 & OGST Rules, 2017 in Form GST ARA-01 before the Authority for Advance Ruling, Odisha (hereinafter referred to as “AAR”) seeking an Advance Ruling on the applicability of Entry No. 72 of Notification No. 12/2017-Central Tax (Rate), dated 28.06.2017, read with Entry No. 72 of Notification bearing SRO No. 306/2017-Finance Department. Government of Odisha to the services provided by them under the category of Information and Communication Technology (ICT) @ School Project.
1.2 The Appellant is a public limited company incorporated in India and registered under the Companies Act, 1956. The Appellant having GSTIN 21AABC12106HIZC is registered in Khordha, Odisha and falls within the jurisdiction of State of Odisha. The Appellant is the social infrastructure arm of IL&FS group and is engaged in the key areas of education, skill development, healthcare and cluster development for a long term and sustainable impact.
1.3 The present appeal concerns, one such ICT project being implemented by the Appellant in the State of Odisha. The Odisha Madhyamik Shiksha Mission (hereinafter referred to as “OMSM”), Government of Odisha, has mandated the Odisha Knowledge Corporation Limited (hereinafter referred to as “OKCL”) to implement ICT project in 4000 government and government aided higher secondary schools across the State of Odisha. Accordingly, OKCL floated a tender (Tender Code No.3) on e-tendering portal of Secured e-Tendering System (SeTs).
1.4 The said tender was for Supply, Installation, Maintenance and Commissioning of Projection system, Interactive White Board, Computer Hardware, Connected Accessories, Installation of Software and other allied accessories, site prepafation (i.e. vinyl flooring, furniture and fixtures, electrical fittings, power backup facilities, LAN, etc ), maintenance of equipment and provisions of computer training services for 5 years, in 4000 schools, divided in 6 zones on the BOOT Model basis.
1.5 The Appellant was successful bidder and was awarded the tender vide letter of award No. OKCL/SME/47/04, dated 12th July, 2013to execute the contract in 5 zones. Accordingly, the Appellant entered into agreement with OKCL on 12th Septemebr, 2013.
1.6 This contract period was for five years and as per the agreement the entire infrastructure (supplied & installed) will be transferred to school and mass education department at zero transfer value. The total contract value of the project was Rs.617.18 Crore. The applicant filed an application on 27.03.2018 before the Authority for Advance Ruling of Odisha, under Section 97 of CGST Act, 2017 and OGST Act, 2017 read with Rule 104 of CGST Rules, 2017 & OGST Rules, 2017 in Form GST ARA-01 seeking an Advance Ruling on the applicability of Entry No. 72 of Notification No. 12/2017-Central Tax read with Entry No. 72 of Notification bearing SRO No. 306/2017-Finance Department, Government of Odisha to the services provided by them under the ICT @ School Project.
Entry No. 72 of Notification No. 12/2017-Central Tax(Rate), dated 28.06.2017, which is relevant to this appeal, is reproduced below for ease of reference:-
