2018 (10) TMI 1143 - AAR - GST

Levy of GST - services of Pollution Testing of Commercial and Non Commercial Vehicles - Whether the service provided for issuing Pollution Under Control Certificate for Vehicles on behalf of State Government is exempted from the GST or not? Held that - The services rendered by the applicant is not covered under Schedule III appended to the Central Goods and Service Tax Act, 2017 as well as Goa Goods and Service Tax Act, 2017. Moreover, the applicant claims that the services rendered by him are covered under SAC 9991. The Services provided by the applicant is also not fully covered under SAC 9991 - The Government has authorised the applicant to issue Pollution Control Certificate on payments. It is the service provided by the applicant to the customers on payment of service charges. Since the services of testing of Pollution are provided on payment of service charge, GST is payable at applicable rate. Ruling - The Activity of issuance of Pollution Under Control Certificate for vehicles issued by the applicant is not covered under SAC 9991 and is covered under Residual Entry and hence, should be taxed @ 18% GST.

Summary

Issues Involved:
1. Whether the service provided for issuing Pollution Under Control Certificate for Vehicles on behalf of State Government is exempted from GST or not.

Analysis:

Issue 1: Whether the service provided for issuing Pollution Under Control Certificate for Vehicles on behalf of State Government is exempted from GST or not.

The case involved an application filed seeking an Advance Ruling under section 97 of the Goa Goods and Services Tax Act, 2017 and the Central Goods and Services Tax Act, 2017 regarding the exemption of GST on the service of issuing Pollution Under Control Certificate for Vehicles. The appellant, appointed by the Government of Goa, Directorate of Transport, provides Pollution Testing services for vehicles and issues Pollution Under Control Certificates. The Pollution Under Control Certificate is a mandatory requirement under the Motor Vehicle Act, issued only if the vehicle emissions align with pollution norms. The appellant procures blank leaflets from the Directorate of Transport and issues them to customers after testing at a higher rate. The consideration charged for this service is the difference between the procurement cost and the issuance cost. The applicant argued that the service falls under SAC 9991, but it was determined that it does not fully meet the criteria of that category. The service provided by the applicant is not covered under Schedule III of the GST Acts and is not a pure service provided by the government authorities. As the service is provided on payment of charges, GST is applicable at the standard rate.

Judgment:
The Advance Ruling Authority concluded that the activity of issuing Pollution Under Control Certificates for vehicles by the applicant does not fall under SAC 9991 but is covered under the Residual Entry, thus subject to GST at the rate of 18%.

This detailed analysis of the judgment provides a comprehensive understanding of the issues involved and the decision rendered by the Advance Ruling Authority in this case.