In re M/s The Nurserymen Co-operative Society (GST AAR Karnataka)
Whether the landscape development and maintenance of garden work for State and Central Government Departments, all government local bodies (Municipalities and Corporations) etc. and other government undertakings through contract from sub-contracts attracts GST as inward supplies from those vendors?
Even after assuming the activity of the applicant being either covered in entry no.3 or entry no.3A of the Notification No.12/2017- Central Tax (Rate) dated 28.06.2017 (as amended), the activity supply by the sub-contractor to the applicant of execution of the sub-contract work of the said activity would not be exempt as it is not covered either in entry no.3 or entry no.3A of the Notification No.12/2017- Central Tax (Rate) dated 28.06.2017 (as amended), as the applicant being the recipient of such service is not covered under the class of recipients enumerated in the said entries.
AAAR Order- GST on sub-contract of landscape development and maintenance of garden work for Govt dept
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, KARNATAKA
1. M/s The Nurserymen Co-operative Society, (called as the ‘Applicant’ hereinafter), having GSTIN number 29AABAT4416F1ZK, has filed an application for Advance Ruling under Section 97 of the CGST Act, 2017 and Section 97 of the KGST Act, 2017, in FORM GST ARA-01 discharging the fee of Rs.5,000-00 each under the CGST Act and the KGST Act.
2. The Applicant is an Association of Persons and is registered under the Goods and Services Act, 2017. The applicant has sought advance ruling in respect of the following question:
Whether the landscape development and maintenance of garden work for State and Central Government Departments, all government local bodies (Municipalities and Corporations) etc. and other government undertakings through contract from sub-contracts attracts GST as inward supplies from those vendors?
3. The applicant furnishes some facts relevant to the stated activity:
a. The applicant states that he is in the business of maintaining the gardens and landscape development for State and Central Governments, local bodies and government undertakings. He also stated that he has been providing pure services (excluding works contract services and other composite supplies not involving any goods) to these recipients of services and the same is exempted by way of serial no. 3 of the Notification No. 12/2017 – Central Tax (Rate) dated 28th June 2017. This is also clarified by the advance ruling issued in KAR ADRG 18/ 2018 dated 06.08.2018.
b. Now the applicant states that he is sub-contracting this work to the sub-contractors and whether such sub-contract work are liable to tax under the GST Act?
4. FINDINGS & DISCUSSION:
We have considered the submissions made by the applicant in their application for advance ruling as well as the additional submissions made by Sri. Vishvanath Bhat during the personal hearing. We also considered the issues involved on which advance ruling is sought by the applicant and relevant facts. At the outset, we would like to state that the provisions of both the CGST Act and the KGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provisions under the KGST Act.
4.1 The transaction in question is examined and it is found that the applicant is executing two types of works wherein in one set of cases the applicant is making supply of pure services with the existing material without it being a works contract services or other composite supply involving any goods and in the second category of supply the applicant is providing composite supply of both goods and services. The first set of activities is covered under entry no.3 of the Notification No.12/2017 Central Tax (Rate) dated 28.06.2017 and the same is clarified as exempt in the advance ruling issues in KAR ADRG 18/2018 dated 06.08.2018.
4.2 The second activity of the applicant is examined. As per entry no. 3A of the Notification No.12/2018 -Central Tax (Rate) dated 28.06.2017 as amended by Notification No. 02/2018 – Central Tax (Rate) dated 25-01-2018 which reads as under:
