2022 (8) TMI 1240 - AAR - GST

Benefit of concessional rate of GST - rate of tax - Works Contract Services - services provided by the applicant to Contractees - execution of works for State Central Governmental authorities Governmental entities - HELD THAT - Some of the institutions are Government entities i.e., local bodies, few are Government authorities, Endowments (Devasthanams) and Public Sectors Undertakings(PSUs). Whether the contracts executed by the applicant fall under at S.No. 3(vi)of Notification No. 11/2017 taxable @6% under CGST SGST respectively? - HELD THAT - The phrases 'Government Entity' 'Governmental Authority' were deleted from the Entry at S.No. 3(vi) of Notification No. 11/2017 with effect from 01.01.2022. Thus the works executed for 'Governmental Entity or 'Government Authority' from 01.01.2022 are taxable @9% CGST SGST each as covered under Entry S.No. 3(xii).

Summary

Issues involved:
1. Determination of the applicable GST rate on works contract services provided by the applicant to various entities before and after 01.01.2022.

Analysis:
The applicant, M/s. Srico Projects Private Limited, sought an advance ruling to ascertain the GST rate applicable to the works contract services they provide to governmental authorities and entities. The questions raised pertained to the eligibility for the concessional rate of 12% under Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017, as amended, and the appropriate rate and classification of GST to be charged before and after 01.01.2022. The applicant submitted the necessary fee and confirmed that the queries were not decided by any authority under the GST Act, leading to the admission of the application.

During the personal hearing, the applicant's representatives reiterated the nature of their works for various government bodies and entities, emphasizing their eligibility for the concessional rate of GST at 12% as per the aforementioned notification. The discussion delved into the entities the applicant was rendering services to, including governmental authorities, local bodies, endowments, and public sector undertakings.

The ruling authority analyzed the relevant provisions and amendments, particularly focusing on the impact of the amendment made in November 2021 to Notification No. 11/2017. The authority clarified that works contract services provided to 'Governmental Authority' or 'Government Entity' from 01.01.2022 are taxable at 9% CGST and SGST each under Entry S.No. 3(xii) of the notification. The ruling differentiated between the tax rates applicable to various entities based on the nature of their classification and the date of service provision.

The ruling concluded by providing detailed explanations and categorizations of the applicable GST rates for different institutions, including local bodies, government entities, governmental authorities, devasthanams, PSUs, and autonomous bodies. The ruling authority's decision was based on a thorough examination of the relevant notifications and legislative provisions, ensuring clarity on the GST rates for works contract services provided by the applicant to various entities.