In re Rudrabhishek Enterprises Limited (GST AAR Uttar Pradesh)
Question 1 Whether the Project Development Service (i.e. Detailed Project Report Service (‘DPR’) and Project Management Consultancy services (‘PMCS’) provided by the applicant to the recipient under the Contract from State Urban Development Agency (SUDA) under the Contract for PMAY-U would qualify as an activity in relation to function entrusted to Panchayat or Municipality under Article 243G or Article 243W respectively, of the Constitution of India?
Answer 1- The Services rendered under the contract with State Urban Development Agency, Uttar Pradesh (SUDA), and for PMAY-U are in relation to functions entrusted to Municipalities under Article 243W and to Panchayats under Article 243G of the Constitution of India.
Question 2. If answer to first question is in affirmative then, whether such services provided by the applicant would qualify as Pure services (excluding works contract service or composite supplies involving supply of any goods) provided to the Central Government, State Government or Union territory or local authority by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243 W of the Constitution, as provided in serial number 3 of Notification No. 12/2017- Central Tax (Rate) dated 28 June, 2017, as amended by notification no. 16/2021 -central tax (rate) w.e.f 1.1.2022 and corresponding Notifications No. KA.N.I.-2-843/X1- 9 (47) I 17-UP. Act-1 – 2017 – Order – (10) – 2017 Lucknow, dated June 30, 2017, as amended, issued under Uttar Pradesh Goods and Service Tax Act, 2017 (‘UPGST Act’), where the Project cost includes the cost of service rendered along with reimbursement of cost of procurement of goods for rendering such service, and, thus, be eligible for exemption from levy of CGST and UPGST, respectively.
Answer 2- Such services would qualify as Pure Service (excluding works contract service or other composite supplies involving supply of any goods)” and accordingly exempt from the payment of GST duly covered in SI. No 3 of Notification No. 12/2017- Central Tax (Rate) dated 28 June, 2017, issued under Central Goods and Services Tax Act, 2017 (CGST/Act), and corresponding notifications issued under Uttar Pradesh Goods and Services Tax Act, 2017 (UPGST Act).
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, UTTAR PRADESH
1. M/s RUDRABHISHEK ENTERPRISES LIMITED, A 6, SECTOR 58, NOIDA, Uttar Pradesh, 201301, (here in after referred to as the applicant) is a registered assessee under GST having GSTN: 09AAACR0707L2ZD.
2. The Applicant has submitted application for Advance Ruling dated 29-11-2022 enclosing duly filled Form ARA-01 (the application form for Advance Ruling).
3. The Applicant in his application sought Advance Ruling as follows : –
(1) Whether the Project Development Service (i.e. Detailed Project Report Service (‘DPR’) and Project Management Consultancy services (‘PMCS’) provided by the applicant to the recipient under the Contract from State Urban Development Agency (SUDA) under the Contract for PMAY-U would qualify as an activity in relation to function entrusted to Panchayat or Municipality under Article 243G or Article 243W respectively, of the Constitution of India?
(2) If answer to first question is in affirmative then, whether such services provided by the applicant would qualify as Pure services (excluding works contract service or composite supplies involving supply of any goods) provided to the Central Government, State Government or Union territory or local authority by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution as provided in serial number 3 of Notification No. 12/2017- Central Tax (Rate) dated 28 June, 2017, as amended and corresponding Notifications No. KA.N.I.-2-843/X1- 9 (47) / 17-UP. Act-1 2017 – order- (10)-2017 Lucknow, dated June 30. 2017, as amended, issued under Uttar Pradesh Goods and service Tax Act, 2017 (‘UPGST Act), where the Project cost X udes cost of of service rendered along with reimbursement of cost of procurement of goods for rendering such service, and, thus, be eligible for exemption from levy of CGST and UPGST respectively.
4. As per the declaration given by the applicant in Form ARA-01, the issue raised by the Applicant is neither pending in any proceedings nor decided in any proceedings in the applicant’s case under any of the Provisions of the CGST Act, 2017/UPGST Act, 2017
5. The applicant has submitted following facts-
1. Under the Department of Urban Employment and poverty Alleviation Program at the state level, STATE URBAN DEVELOPMENT AGENCY (SUDA in short) has been constituted as the nodal agency in the Uttar Pradesh government. At the district level District Urban development Agencies (DUDAs) have been established. Through these agencies (SUDA/DUDA), schemes for social and economic upliftment of the urban poor are being implemented. In the direction of all-round upliftment of the urban poor by the Department of Urban Employment and Poverty Alleviation Programme, the following scheme is being . operated mainly through the State Urban Development Agency (SUDA) – Pradhan Mantri Awas Yojana-Housing for All (Urban) Mission.
As SUDA Lucknow is a State Level Nodal Agencies (SLNA) for PMAY (U) in Uttar Pradesh, SUDA through its Director invited technical and financial proposals from eligible Consultancy Firms / Agencies/ Companies for Preparation of Detailed Project Report (DPR) and providing Project Management Consultancy Service (PMC) services under Pradhan Mantri Awas Yojna (PMAY in short) for Projects under Beneficiary Led Construction in 635 Urban Local Bodies/Authorities in Uttar Pradesh by its Request for Proposal (RFP) vide Invitation No. 708/01/29/HFA/2016-17 dated 01/02-06-2017 (RFP Attached Annexure-4) (Page Nos. 55-116).
2. Brief Description of the Project-
Pradhan Mantri Awas Yojana – Urban (PMAY-U), a flagship Mission of Government of India being implemented by Ministry of Housing and Urban Affairs (MoHUA), was launched on 25th June 2015. The Mission addresses urban housing shortage among the EWS/LIG and MIG categories including the slum dwellers by ensuring a pucca house to all eligible urban households by the year 2022, when Nation completes 75 years of its Independence. PM ( ) adopts a demand driven approach wherein the Housing shortage is decided based on demand assessment by States/Union Territories. State Level Nodal Agencies (SLNAs), Urban Loca Bodies (ULBs)/ implementing Agencies (Ias), Central Nodal Agencies (CNAs) and primary Lending Institutions (PLIs) are main stake holders who play in important role in implementation and success of PMAY(U).
The mission covers the entire area consisting of Statutory Towns, Notified Planning Areas, Development Authorities, Special Area Development Authorities, Industrial Development Authorities or any such authority under State legislation which is entrusted with the functions of urban planning & Regulations. The scheme has been divided into four verticals as given below:
