In re Lakhlan & Quereshi Construction Company (GST AAR Rajasthan)
Question 1. Whether the service recipient i.e. M/s. Jaipur Smart City Limited is a “Governmental Authority” as defined in the explanation to clause (16) of section 2 of the IGST Act, 2017.
Answer 1 : No, M/s Jaipur Smart City Limited is not a “Governmental Authority”.
Question 2. Whether Item number (vi) in Column (3) of serial number 3 of Notification 11/2017 dated 28th June 2017 as amended by Notification number 24/2017 of Central Tax (Rate) dated 21st September 2017 is applicable in respect of all payments related to work order for Fire Fighting System installation at contracted area between applicant and Jaipur Smart City Limited?
Answer 2 : NO.
Question 3. What will be the GST rate for the work undertaken by applicant for M/s Jaipur Smart City Limited under Bid Reference no. JSCL/Works/02/2020-21 ?
Answer 3 :The services provided by the applicant will be covered under Item number (xii) in Column (3) of serial number 3 of Notification 11/2017 dated 28th June 2017 as amended time to time and attracts GST @18% (i.e. 9% CGST & 9% SCGST).
Question 4. Whether the Applicant is liable to pay GST under RCM in respect of road cutting charges paid by them to Jaipur Nagar Nigam (JNN) on behalf of M/s. Jaipur Smart City Limited in relation to such contract? If the answer to the same is in affirmative, what will be the GST rate for such payment under RCM?
Answer4: Yes, the Applicant is liable to pay GST under RCM in respect of road cutting charges paid by them to Jaipur Nagar Nigam (JNN) on behalf of M/s. Jaipur Smart City Limited (JSCL) under Section 9 of CGST Act, 2017 read with No. 5 of the Notification No. 13/2017-CT(R) dated 28.06.2017 & No. 9 of the Notification No. 12/2017 of central tax (rate) dated 28th June 2017. The rate of GST would be @ 18% ( i.e. 9% CGST+9% SCGST).
Question 5. Whether recovery of such road cutting charges by the Applicant from M/s. Jaipur Smart City Limited liable to GST? If the answer is in affirmative, what will be the GST rate?
Answer 5 :Yes. As M/s JSCL is not a governmental authority therefore, serial number 3 of Notification No. 12/2017 of central tax (rate) dated 28th June 2017 as amended by Notification No. 02/2018 of central tax (rate) dated 25th January 2018 is not applicable on applicant. Further, as per clause (c) of sub section (2) of Section 15 of CGST Act, 2017, recovery of such road cutting charges by the Applicant from M/s. Jaipur Smart City Limited will be included in the value of supply under GST as the applicant is not qualified as a pure agent in the instant case. Thus, the applicant is liable to pay GST @18% (i.e. 9% CGST+9% SGST).
Read AAAR Order: GST on recovery of road cutting charges from Jaipur Smart City Limited
