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TMI Blog2020 (3) TMI 190X X X X Extracts X X X X X X X X Extracts X X X X ..... supply and therefore the applicability of GST on the Operation and Maintenance of the said contract is not discussed. In respect of Contract (2), the Time of Supply for the composite supply of Operation and Maintenance under the said contract starts from March 2018 only as seen from the submissions before us. Hence on the entire activity of Operation and Maintenance under Contract (2) GST is leviable. In respect of Contract (3), the first RA bill is raised on 20.12.2017 for the main works as per Section-I of the contract and the applicant has furnished details upto L.S.9,h Part Bill dated 25.01.2019 and it is seen that the supply of Operation and Maintenance agreed to in the said contract as per Section -II of the Agreement for a receivable of ₹ 69,64,307.76 is not billed in any of these bills and the services are yet to be supplied. Therefore, it is amply evident that GST is leviable in respect of Operation and Maintenance agreed to be supplied under Contract (3). Applicability of SI. No. 3A of Notification No. 12/2017-C.T.(Rate) dated 28.06.2017 as amended by Notification No. 02/2018-C.T.(Rate) dated 25.01.2018 - HELD THAT:- In the case at hand, M/s, TW ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -C.T.(Rate) dated 25.01.2018 is applicable to the Operation and Maintenance Part(Section-II) of the Contracts, in as much as all the other required conditions stands fulfilled. - TN/07/AAR/2020 - - - Dated:- 31-1-2020 - MS. MANASA GANGOTRI KATA, I.R.S., AND THIRU KURINJI SELVAAN V.S., M.SC., (AGRI.), M.B.A., MEMBER, Note : Any Appeal against the Advance Ruling order shall be filed before the Tamil Nadu State Appellate Authority for Advance Ruling, Chennai under Sub-section (1) of Section 100 of CGST ACT/TNGST Act 2017 within 30 days from the date on which the ruling sought to be appealed against is communicated. At the outset, we would like to make it clear that the provisions of both the Central Goods and Service Tax Act and the Tamil Nadu Goods and Service Tax Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the Central Goods and Service Tax Act would also mean a reference to the same provisions under the Tamil Nadu Goods and Service Tax Act. M/s. Indian Hume Pipe Company Limited, No.361, B2, 2nd Floor, Le Royal Riteroof, Lloyds Road, Gopalapuram, Chennai-600086 (herei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e contractor (Section-II). 3. CE/CBE/16/2017-18 dated 05.07.2017 for providing dedicated water supply distribution to the Added Areas of Tiruppur Corporation in Tiruppur District including Trial Run and Commissioning followed by paid maintenance for a period of one year of the Scheme. The contract contains two parts a. construction period of the contract (Section-I); b. Operation and maintenance by the contractor(Section-II). 2.2 The applicant has stated that for the projects 1 2 above they have already completed the Construction part(Section -I)of the projects viz., Construction of Head works, Sumps, Pump Rooms, laying, joining of pipe line and commissioning of entire work awarded to them prior to the implementation of GST. Under the GST regime as per the contract part they have to undertake Operation and maintenance part of the said works (Section II) for the remuneration as determined in the contract as per the BOQ. They have further stated that for operating and maintaining the water supply scheme they generally do not require any goods of substantial amount. Basically it is for maintaining the water supply scheme in proper manner and attending to any defects arisen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ottai and WSIS to Tiruppur. 4. The applicant is under the administrative control of Central Tax. The said jurisdictional authority was addressed to report if there are any pending proceedings in the applicant s case on the issues raised by the applicant in the ARA application and for comments on the issues raised. The said authority did not furnish any report and also has not furnished any comments. 5. The submissions of the Applicant were examined. From the various submissions of the applicant it is seen that the applicant has entered into agreement with Tamil Nadu Water Supply and Drainage Board(TWAD) for providing Combined Water Supply Scheme vide Contracts CE/TNJ/07/2013-14 dated 04.10.2013; CE/TNJ/28/2013-14 dated 03.03.2014 and CE/CBE/16/2017-18 dated 05.07.2017. On perusal of the documents furnished the following are observed:- Agreement No. CE/TNJ/07/2013-14/dt. 04.10.2013 is for Providing Combined Water Supply Scheme(CWSS) to 1751 Rural Habitations in Kunnandarkovil(Part), Gandarvakottai, Karambakudi, Pudukkottai(Part), Thiruvarankulam, Aranthangi (Part), Annaavasal(Part), Viralimalai (Part) unions of Pudukkottai District and Vallam Town Panchayat of Thanjavur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tenance is charged for ₹ 1.21 Crores. The Operation and Maintenance charges are not charged in the RA bills 1 to 28. From the Journal voucher No. CHN006JVQ118-62 dated 30/06/2018 of the applicant it is seen that payment in respect of RA Bill-29 dated 07.05.2018 is received and accounted. Agreement No. CE/CBE/16/2017-2018 dt. 05.07.2017 is for Providing Dedicated Water Supply Distribution to the Added Areas of Tiruppur Corporation in Tiruppur District including trial Run and Commissioning followed by paid maintenance for a period of one year of the Scheme . The applicant along with the application for advance ruling, has furnished the Forwarding slip to the Lump Sum Agreement , VIII.Special Conditions of Contract and BOQ corresponding to Operation and Maintenance of Scheme . Further they have furnished Copy of Agreement- Volume % and 2/4 , LS7th Part Bill and General Abstract of the entire work after the personal hearing. From the documents, it is seen that the agreement is for supply of pipes, construction of the required infrastructure and paid maintenance after the trial run. The agreement is a Lumpsum agreement for an estimated amount of ₹ 183.46 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he charges for chemicals, consumable, labour and other services in the course of execution of Operation and Maintenance . Thus, the Operation and Maintenance undertaken as per the contracts (2) and (3) are supplies which are Composite Supplies as per Section 2(30) and are taxable to GST. 6.2 In respect of supplies taxable to GST, the Time of Supply is provided under Section 13 of the Act which states that:- (2) The time of supply of services shall be the earliest of the following dates, namely:- (a) the date of issue of invoice by the supplier, if the invoice is issued within the period prescribed under sub-section (2) of section 31 or the date of receipt of payment, whichever is earlier; or (b) the date of provision of service, if the invoice is not issued within the period prescribed under sub-section (2) of section 31 or the date of receipt of payment, whichever is earlier; or (c) the date on which the recipient shows the receipt of services in his books of account, in a case where the provisions of clause (a) or clause (b) do not apply ................................................................... Explanation .- For the purposes of c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 99 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 Central Government, State Government or Union territory or local authority or a Governmental authority or a Government Entity by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution. Nil Nil Explanation 2(zf) of the Notification No. 12/2017-C.T.(Rate) defines governmental authority as under: (zf) governmental authority has the same meaning as assigned to it in the Explanation to clause (16) of section 2 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017): Explanation to Clause (16) of Section 2 of the Integrated Goods and Service Tax Act (IGST) is given as under: Explanation ,- For the purposes of this clause, the expression governmental authority means an authority or a board or any other body,- (i) set up by an Act of Parliament or a State Legisl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commercial purposes . The Eleventh Schedule of Article 243G of the Constitution list the functions of the Municipality at SI No 5 as Water Supply for Domestic, Industrial and Commercial purposes . The contracts under consideration are for providing Combined Water Supply Scheme (CWSS) to various regions. Thus, it is clear that the supplies as per the contracts are works received by TWAD and are in relation to functions entrusted to Panchayat or Municipality. 7.4 In respect of Contract (2), the Operation and Maintenance of the executed project is undertaken after implementation of GST and is a composite supply. The contractor is obligated to borne the cost of water, gas, consumables, chemicals and other services during the period of Maintenance as seen from the VIII. Special Conditions of Contract . The details of the quantum of materials and Labour involved in the said contract are not furnished separately before this authority. We therefore, hold that in respect of contract (2) [agreement No. CE/TNJ/28/2013-14 dated 03.03.2014], the exemption provided at SI.No. 3A of Notification No. 12/2017-C.T.(Rate) is applicable if the total value of the supply of goods involved in the RA ..... X X X X Extracts X X X X X X X X Extracts X X X X
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