In re Zigma Global Environ Solutions Private Limited (GST AAR Tamilnadu)
Q. Classification of the services viz ‘Solid waste management – Revamping of existing dumped Garbage in compost yards by Bio -mining process’ provided by the applicant to M/s. Erode City Municipal Corporation, Erode?
A. Solid Waste Management-Revamping of Existing Dumped Garbage in Compost Yards by Bio-Mining process” provided by the applicant to M/s. Erode City Municipal Corporation, Erode is classifiable under SAC 9994 as per the Annexure to Notification No. 11/2017-C.T.(Rate) dated 28.06.2017 for the reasons discussed in Para 7.
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING,TAMILNADU
The Applicant has submitted the copy of application in Form GST ARA – 01 and also submitted a copy of Challan evidencing payment of application fees of Rs.5,000/- each under sub-rule (1) of Rule 104 of CGST rules 2017 and SGST Rules 2017.
2.1 The applicants have stated that the Commissioner, Erode City Municipal Corporation, had invited tenders for Solid Waste Management Request for Proposal for Revamping of Existing Dumped Garbage in Vendipalayam and Vairapalayam Compost Yards by Bio-Mining Process under implementation of the City Mission in Erode”. The applicant was declared and was awarded with the project. Accordingly, agreement was executed between the Applicant and the Commissioner Erode City Municipal Corporation vide agreement dated 19/01/2019. As per the Request for Proposal document (the “RFP”), the Erode City Corporation intends to remove the legacy waste (approximately 560000 CUBIC METER) dumped at the Erode dump yard through bio-mining process on Design, Build, Own and Operate (DBOO)concept. (here in after referred as Project). Thus, as per the above they, have to remove the legacy waste (approximately 560000 CUBIC METER) dumped at the Vendipalayam and Vairapalayam dump yard by bio-mining process. The Processing plant/ legacy waste removal plant are to be operated and maintained by them by fulfilling all the statutory provisions and the cost of built design, installation, operation, maintenance in this plant are to be solely borne by them. The Scope of the project as per the work plan includes excavating the existing mixed compacted garbage which underwent biological degradation in the land portion allocated/earmarked by Erode City Municipal corporation and sieving them by Mechanical sieving machine or any other equipment at their cost; Control Odour; Eco friendly and non-polluting process in order to reduce the impact of Dumping site in the adjacent areas; Segregate the excavated garbage in the land portion earmarked; Selling, diverting for recycling, marketing and recycling the excavated materials; Creation and maintenance of infrastructure, facilities and amenities; Leveling the earth surface by bull-dozer or any other earth moving equipment; Deployment of necessary manpower, materials, equipment’s, tools and construction of plants and shed sand creation of facilities for handling, separating, segregating and storing; providing security arrangement for the plan project site, machineries, equipment etc; Thus they have to remove the legacy waste dumped by bio-mining process on putting up the processing plant/legacy waste removal plant under Design, Build, Own and Operate(DB00). For the work executed the Erode City submitted that the services provided by them to M/s Erode City Municipal Corporation is exempted from payment of GST as per SI.No. 3 of Notification No: 12/2017 Central Tax (Rate) dated 28-7-2017 as amended.
2.4 With reference to deduction of TDS as per the provisions of Section 51 of CGST Act and TNSGST Act, 2017 for the services rendered as stated in the Application, it is submitted that the persons specified under Section 51(1) as per Notification No. 50/2017-Central Tax dated 13/09/2018 has to deduct tax at source on taxable goods or services or both, where the total value of such supply, under a contract, exceeds two lakh and fifty thousand rupees. In the instant case, M/s Erode City Municipal Corporation falls within the above notification as specified persons. However, as stated in the preceding submissions, the services rendered by them is exempted from payment of GST as per Si. No. 3 of Notification No: 12/2017 Central Rate dated 28/06/2017. Hence no amount needs to be deducted as per the provisions of Section 51 of Act, ibid.
3.1 Due to the prevailing PANDEMIC situation and in order not to delay the proceedings, the appellant was addressed through the Email Address mentioned in the application to seek their willingness to participate in a virtual Personal Hearing in Digital media vide e-mail. The applicant consented and the hearing for admission of the application was held on 20.08.2020. S/Shri. Nagesh Prabhu, Director of the applicant company and B.Venkateswaran, Authorized Representative for applicants participated in the virtual personal hearing. They furnished a written submission which was taken on record. The authorized representative reiterated the submissions made along with the application and that furnished for the hearing shared in mail. It was intimated that of the three questions for which ruling is sought, the Question No.3, is not admissible as the applicant is not raising the question on their behalf and the applicant acceded to it. The applicant was asked to furnish the Invoices raised on Erode Municipal Corporation. They were also asked to furnish a Write-up on the activities undertaken as per the agreement entered into with EMC cross referencing the Tender/Agreement to establish whether the activity is one of ‘Reclamation of Land’ or ‘Solid Waste Management’ along with specific category the activity fall under Annexure to Article 243 W. The applicants were informed that on receipt of submissions, if needed, another hearing would be extended, if necessary.
3.4 With reference to question no. 3 raised by them, during the Virtual Hearing it was informed that the issue raised therein, was outside the purview of Advance ruling and they had agreed to drop it, however, they requested to reconsider the issue for the following reasons:
> The Advance Ruling authority is governed by the provisions of Chapter XVII of CGST ACT 8s the relevant Sections 95 to 98, 102, 103, 104 and 105. As per Section 95, the term ‘advance ruling’ means a decision provided by this authority to the applicant on matters or questions specified in Section 97(2), in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant.
> As per Section 97, the question on which the advance ruling is sought under this Act, shall be in respect of, —
