Work contracts service to APEPDCL not eligible for concessional GST rate of 12%

In re Vijai Electricals Limited (GST AAAR Andhra Pradesh)

Ruling of AAR is upheld. Confirmed that the work contracts service rendered by M/s Vijai Electricals (the appellant) to APEPDCL are not eligible for concessional rate of tax 12% as per serial no.3 of entry no.vi (a) of notification no. 24/2017 Central Tax (Rate) dated 21-09-2017.

Main issue of contention is whether APEPDCL would fit into the definition of ‘business’ as per Notification no. 17/2018 dated 26.07.2018.

The explanation provided in Notification no. 17/2018 dated 26.07.2018, reads as,-

“Explanation. – For the purposes of this item, the term ‘business’ shall not include any activity or transaction undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities.”

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