In re Rajshyama Construction (P) Ltd (GST AAR Uttarakhand)
Section 2(119) of the Act: works contract means a contract for building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning of any immovable property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of such contract;
On perusal of said notification, we find that the work contract services in respect of construction/ widening of road provided by the applicant to his main contractor is covered under entry at Serial No. 3(iv) of the said notification. We also find that before amendment vide notification dated 25.01.2018 (supra), specific entry on rate of services provided by the sub-contractor to main contractor were introduced, the activity of the applicant was remain covered under the scope of Serial No. 3(iv) of the Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 (as amended), which provided the rate of GST @ 12%) [6% CGST + 6% SGST] on the services supplied by way of construction of road. Thus, the services provided by the applicant as sub-contractor to principal contractors continues to be covered under the Serial No. 3(iv) of the Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 (as amended from time to time).
Further Appellate Authority for Advance Ruling, Maharashtra in the case of M/S Shree Construction and Authority for Advance Rulings, Punjab in the case of M/S S.P. Singla Constructions (P.) Ltd reported in [20191 taxmann.com 448 (AAAR-MAHARASHTRA) and [20191 111 taxmann.com 356 (AARTUNJAB) respectively on the same issue has passed the ruling that services provided by the sub-contractor to main contractor is covered tinder Serial No. 3(iv) of the Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 (as amended from time to time) and attracts GST @ 12% CGST + 6% SGST].
The services pertaining to construction/ widening of road provided by the applicant as a sub-contractor in respect of work contract falls under the scope of Serial No. 3(iv) of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 (as amended from time to time) and attracts GST @ 12% [6% CGST + 6% SGST] as on date.
FULL TEXT OF THE ORDER OF AUTHORITY FOR ADVANCE RULING, UTTARAKHAND
1. This is an application under Sub-Section (1) of Section 97 of the CGST/SGST Act, 2017 (herein after referred to as Act) and the rules made thereunder filed by M/s. Rajshyama Construction (P) Ltd, 22-Abhisek Nagar, Kankhal, Hardwar, Uttarakhand (here in after referred to as ‘the applicant’) is registered with the GSTN having Registration No. 05AACCR4982R1ZN and seeking advance ruling on what will be the rate of tax to be levied by the sub-contractor to main contractor for original work contract pertaining to Government entity .
2. Advance Ruling under GST means a decision provided by the authority or the appellate authority to an applicant on matters or on questions specified in sub section (2) of section 97 or sub section (1) of section 100 in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant.
3. As per the said subsection (2) of Section 97 of the Act advance ruling can be sought by an applicant in respect of:-
(a) Classification of any goods or services or both
(b) Applicability of a notification issued under the provisions of this Act,
(c) Determination of time and value of supply of goods or services or both,
(d) Admissibility of input tax credit of tax paid or deemed to have been paid
(e) Determination of the liability to pay tax on any goods or services or both
(f) Whether the applicant is required to be registered
(g) Whether any particular thing done by the applicant with respect to any goods or services or both amounts to or results in a supply of goods or services or both within the meaning of that term
4. Since applicant has sought advance ruling on classification & determination of tax liability, therefore, in terms of said Section 97(2) (e) of the Act, the application filed by the applicant was admitted. Accordingly hearing was fixed on 15.06.2020 which was attended by the Shri Amit Tyagi, Advocate on behalf of the applicant. During the course of personal hearing, Shri Amit Tyagi has submitted that Maharashtra Advance Ruling in the case of M/S Shri Construction has given that need to be charged. He also added that serial no. 12 & 31 of the GST council meeting dated 18.01.2018 may be taken on record and as per his interpretation rate is 12%. Ms Preeti Manral, DC, SGST-Uttarakhand also present in the hearing and submitted that advance ruling of M/S NHPC to be taken on record and should be decided on the same lines.
5. On perusal of record, we find that the applicant is engaged in providing work contract service as sub-contractor to main contractor for original contract work in respect of construction/widening of road. The applicant has sought ruling in respect of rate of GST to be charged & collected by them from his main contractor in relation to said work .
6. In this context relevant legal provisions are reproduced as under:
A. Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017
G.S.R……(E).- In exercise of the powers conferred by sub-section (1) of section 9, subsection (1) of section 1 1, sub-section (5) of section 15 and sub-section (1) of section 16 of the Central Goods and Services Tax Act, 2017 (12 of 201 7). the Central Government, on the recommendations of the Council, and on being satisfied that it is necessary in the public interest so to do, hereby notifies that the central tax, on the intra-State supply of services of description as specified in column (3) of the Table below, falling under Chapter, Section or Heading of scheme of classification of services as specified in column (2), shall be levied at the rate as specified in the corresponding entry in column (4), subject to the conditions as specified in the corresponding entry in column (5) of the said Table:
