Case Law Details
In re NBCC (INDIA) Limited (GST AAR Odisha)
We see that the applicant has been awarded construction of Directors Bungalow, 40 nos. staff Quarters, 84 nos Faculty Quarters in the IIT Campus, Bhubaneswar. We also observe that the civil construction of residential quarters is not the primary work entrusted to IIT, Bhubaneswar. Accordingly, we fail to understand as to why the benefit of concessional rate @ 12% GST should be available to this particular works contract awarded to the applicant? The intention of the Legislature has been to allow concessional rate to such work which has been entrusted to a Government entity for public interest in general, but extrapolating and extending this concessional rate to any or all activities of IIT, Bhubaneswar will not only be unwarranted but also defeat the very purpose of concessional rate. Hence, we hold that construction of Directors Bungalow and construction of staff/faculty quarters is out of purview of exemption provided under Notification No. 11/2017-C.T. (Rate), dated 28-6-2017 and would attract GST @ 18% ( 9% CGST + 9% SGST).
In view of the discussions foregoing, we are inclined to hold that the works entrusted to the Applicant by IIT, Bhubaneswar under contract/agreement dated 02.05.2016 cannot be termed as composite supply and thus entire work under the said contract shall not be entitled to concessional rate in terms of Notification No. 11/2017-C.T. (R), dated 28-6-2017. However, we also hold that the supply of goods and/or services or both which squarely fall within the ambit of scope of work entrusted to HT, Bhubaneswar by Government of India shall be entitled for concessional rate under Sr. No. 3(vi) to Notification No. 11/2017-C.T. (R). Accordingly, each and every supply under the subject contract shall be treated separately for determining the rate of tax under the CGST Act, 2017 read with the provisions of GST Tariff and respective exemption notifications.
Also Read AAAR Order- Work contract entrusted to NBCC (India) by IIT, Bhubaneswar is composite supply contract
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, ODDISHA
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