Whether the services provided in relation to solid waste management, garbage collection, disposal, water supply, cleaning of colony” are exempt supply under gst?

PJ/Case Law/2018-2019/3512

Case:Shri Dhananjay Kumar Singh
Citation: 2019-TIOL-23-AAR-GST
Issue: Whether the services provided in relation to solid waste management, garbage collection, disposal, water supply, cleaning of colony” are exempt supply under gst?
Brief Facts: The applicant M/s Dhananjay Kumar Singh HN 13, Sanyasi para, Khamtarai, Raipur, Chhattisgarh GSTIN, files the issue involved in appeal22AVZPSSG4SERZZ u/s 97 of the Chhattisgarh Goods & Services Tax Act, 2017. He is a service provider who is engaged in the business of executing service contracts and had been awarded a contract by the Chhattisgarh Housing Board (herein to referred as CGHB) for providing services in relation to Solid waste management, water supply operations, Garbage Collection door to door and disposal, Cleaning of colony i.e. garden, street, and open area, drainage system, sewerage cleaning of water tank (all UG Sump & Over head tank), cleaning of common area of residential area developed by Chhattisgarh Housing Board and not handed over to the local authority for its maintenance and seeks advance ruling on whether the said services are exempt under as per notification no. 12/2017 dated 28th June, 2017 as updated and amended time to time or not.

APPELLANT’S CONTENTION:The applicant's contention is that residential area developed by Chhattisgarh Houslng Board and not handed over to the local authority by Chhattisgarh Housing Board (CGHB) is exempt under as per notification no. 12/2017 dated 28th June 2017 as updated and amended time to time. CHGB is a Government entity as it is constituted in terms of Chhattisgarh Housing Board Act and engaged in the various work performed by municipality under article 243W of Constitution. Even the commissioner (Appeal) has held them as “Government authority” for service tax exemption. Hence, the work allotted by CGHB will be exempt from payment of GST. The applicant also contended that Karnataka Advance ruling authority has held that maintenance of parks provided by society to State Government, Central Government or a local authority is also exempt under entry no.3 of notification 12/2017-Central Tax(Rate) dated 28.6.2017.
Judgment:-the exemption under the above entry applies only in case when it is pure service. The invoice issued and agreement clearly shows that there is no supply of goods involved. The CHGB is constituted under Chhattisgarh Housing Board Act, 1972 and seeing its constitution as well as definition of “Government authority’, it was held that CHGB falls under this definition.
After seeing the Article 243W of Constitution and Twelfth Schedule(Article 243W of the Constitution (Seventy-Fourth Amendment) Act, 1992 as well as the work undertaken by applicant, it was held that services provided by applicant by their very nature fall in the list of services enumerated under serial number 5,6,8,10,12 and 17 of 12^th Schedule of Article 243W of Indian Constitution.
Decision:They came to the conclusion that the said services provided by the applicant to Chhattisgarh Housing Board qualifies falls under the category of services as stipulated under Notification No. 1212017-State Tax (Rate) and hence is exempt.
Comment: This is very detailed and good decision. The Advance Ruling has indepth analysed each aspect like pure services, definition of Governmental authority and services listed in Article 243W and then came to conclusion that the exemption is available to the assessee. There has been great deliberation about the definition of Governmental authority as well as functions of Municipality listed in Article 243W. A clear view has been provided on the same in this decision.
Prepared By: Kanika Mehta

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PJ/Case Law/2018-2019/3512

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