In re Om Parkash Contractor (GST AAR Haryana)
Q1. Whether applicant’s activities, as briefly mentioned at sl. No. 12(B) above, qualify to be a composite supply of goods and services and exempt from GST under entry No. 3A of Notification No. 12/2017-CT(R), dated 28.06.2017 as amended by Notification No. 2/2018-CT(R), dated 25.01.2018?
Ans 1. As per Serial No. 3A Chapter 99 of the Notification No. 12/2017-CT(R), dated 28.06.2017 as amended by Notification No. 2/2018-CT(R), dated 25.01.2018 under the CGST Act, 2017and the corresponding State Tax notification under HGST Act, 2017, The work carried by the applicant is a Composite supply of goods and services in which the value of supply of goods constitutes not more than 25 per cent. of the value of the said composite supply provided to the State Government by way of an activity in relation to the function entrusted to a Panchayat under article 243G of the Constitution or in relation to the function entrusted to a Municipality under article 243W of the Constitution and thus exempt under GST. Thus, the Serial No. 3A of Notification No. 12/2017-CT(R), dated 28.06.2017 as amended by Notification No. 2/2018-CT(R), dated 25.01.2018 under the CGST Act, 2017 is applicable to the applicant.
Q2. Whether the service recipient, Public Health Department, State of Haryana, is required to deduct TDS under Section 51 of the CGST Act, 2017 given the fact that as per applicant’s version his aforementioned services are exempt from GST under Notification No. 12/2017-CT(R), dated 28.06.2017 as amended Notification No. 2/2018-CT(R), dated 25.01.2018?
Ans. As per the Standard Operating Procedure issued by Law Committee of GST Council on 28.09.2018, if the services ;eceived by deductor from deductee are exempt, then there is no requirement for tax deduction under GST. Therefore, the service recipient being Public Health Department (Deductor), State of Haryana is not required to detect TDS under section 51 of the CGST Act, 2017 as question above clarifies that applicant services are exempt from GST under Notification No. 12/2017-CT(R), dated 28.06.2017 as amended vide Notification No. 2/2018-CT(R), dated 25.01.2018.
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, HARYANA
Brief facts of the case:
1.1 As per the details &facts submitted to our office in the application, Om Parkash Contractor, is registered under the provisions of the Central Goods and Services Tax Act, 2017 read with the provisions of the Haryana State Goods and Services Tax Act 2017 (hereinafter known as the “Assessee/Applicant).
1.2 That the applicant is a civil contractor engaged in executing government works which include construction of civil structure, repair, maintenance and renovation of such works.
1.3 The applicant has applied for seeking advance ruling under section 97(1) of the CGST Act, 2017for a Work Contract allotted by Public Health Department, Government of Haryana as per the terms in their tender as annexed with the application.
1.4 The various activities to be undertaken under this work are Operation & Maintenance of structures/components, Staff Quarters, Pump Chamber, Boundary Wall, Distribution System, Tube wells, Pumping Machinery, OHSR etc.
As per Tender Acceptance Memo No. 6971 dated 24.07.2019, the total cost of the work is 376.95 lacs. Costs allocated under different heads, as shown in the sheet enclosed with the Tender Acceptance Memo, are as under:
1.4 That further it has been detailed by the applicant in the contract and Api–appurtenant to other supporting documents that there are 2 contracts:
a) Contract for Water Supply Scheme at Samalkha Town, Distt. Panipat (Haryana)
