2020 (8) TMI 248 - AAR - GST

Governmental Authority or not - Applicability of Sl No. 3(vii) of Notification No 08/2017 Integrated Tax (Rate) dated 28/06/2017 - contract for the dredging of Wular lake along with its feeder channels and the strengthening of embankments of the lake - HELD THAT - It appears from Notification No. 311 dated 25/09/2012 of the Forest Department of State Government (now a Union Territory) that the recipient is constituted as an authority under section 3 (1) of the Jammu and Kashmir Development Act, 1970 for preservation and conservation of Wular Lake. The Board of the recipient, constituted the same day by Notification No. 314, ensures 100% control of the State Government (now a Union Territory). The powers and functions of the recipient are described in Govt Order No. 396 FST of 2012 dated 10/10/2012 of the Forest Department, Government of Jammu and Kashmir. They broadly conform to the function of promoting urban forestry, protection of environment and ecology entrusted to a municipality under article 243W of the Constitution. The recipient is, therefore, a Governmental Authority within the meaning of para 5(ix) of the IGST Notification. The applicant's supply to the Wular Conservation and Management Authority is taxable under Sl No. 3(vii) of Notification No 8/2017 Integrated Tax (Rate) dated 28/06/2017, as amended from time to time.

Summary

Issues:
1. Admissibility of the application
2. Submissions of the Applicant
3. Submission of the concerned Officer
4. Observations and findings of the Bench

Admissibility of the application:
The applicant sought a ruling on the applicability of a specific notification to a contract awarded by the Wular Conservation and Management Authority. The application was deemed admissible under the relevant provisions of the GST Act and IGST Act, with no objections raised by the concerned officer, leading to its acceptance.

Submissions of the Applicant:
The applicant provided detailed submissions, including work allotment orders, emphasizing the nature of the work as a works contract service involving earthwork. The applicant argued that the supply should be taxed at 5% based on the specific notification cited, following the change in the recipient from the State Government to the Union Territory of Jammu and Kashmir.

Submission of the concerned Officer:
The concerned officer expressed difficulty in determining the proportion of material involvement in the contract due to insufficient information provided in the application. As a result, the officer refrained from offering a conclusive comment on the matter.

Observations and findings of the Bench:
The Bench analyzed the relevant notification and the specifics of the contract, noting that the work primarily involved earthwork exceeding 75% of the contract value. Additionally, the recipient, the Wular Conservation and Management Authority, was established as a Governmental Authority under the IGST Notification. Based on these observations, the Bench ruled that the applicant's supply to the Authority is taxable under the specified notification.

This comprehensive analysis of the judgment highlights the issues addressed, the arguments presented by the applicant, the officer's submission, and the final ruling based on the observations and findings of the Bench.