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TMI Blog2021 (1) TMI 597X X X X Extracts X X X X X X X X Extracts X X X X ..... rticle 243W of the Constitution. Hence, three conditions are required to be satisfied for a service to be covered under subject entry of the notification which is as below: (1) It must be pure service not involving any supply of goods. (2) It must be provided to the Central Government or State Government or Union Territory or Local Authority or a Governmental Authority or a Government Entity. (3) It must be an activity in relation to any function entrusted to a (i) Panchayat under Article 243G of the Constitution; or (ii) Municipality under Article 243W of the Constitution. The first condition to be verified is as to whether the services supplied by the applicant are pure services or otherwise. We, therefore, are of the opinion that if and only if, the first condition is satisfied, only then we will be required to look into the applicability of the other two conditions i.e. whether the other two conditions are also satisfied as per the current contract/agreement made by the applicant with Rajkot Urban Development Authority. So, the first condition to be discussed is as to what is meant by pure service? Since pure service has not been defined under GST, the same can be construed in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould not be possible for us to decide whether the services supplied by the applicant are pure or otherwise merely on the basis of the letter of acceptance submitted by them. Further, in absence of the aforementioned agreement, and without going through the terms and conditions of the agreement, it would not be possible for us to decide whether the Services provided by the applicant are Pure or are a supply of services along with supply of goods since the work is connected to the project of Affordable Housing and could also involve Works Contract service. X X X X Extracts X X X X X X X X Extracts X X X X ..... is directly under the control of the State Government. The applicant has placed reliance on the following advance rulings given by different authorities which are directly applicable to the instant case and thus one may draw conclusive evidence and has submitted copies of the same: (a) Gujarat Authority for Advance Ruling vide order No.GUJ/GAAR/R/08/2019 dated 01.05.2019. (b) Rajasthan Authority for Advance Ruling vide Order No.RAJ/AAR/2018-19/13 dated 25.08.2018. (c) Madhya Pradesh Authority for Advance Ruling vide Order No.02/2018 dated 22.06.2018. 4. The applicant has put forward the following question seeking Advance Ruling on the same: "Whether the Rajkot Urban Development Authority (Accredited Department of Gujarat State Government) falls under the definition of Government Authority or a Government entity as defined under para 2(zf) & 2(zfa) of the Notification No.12/2017-Central Tax(Rate) dated 28.06.2017?" 5. The applicant has provided additional submission vide letter dated 15.08.2020 which was received vide email on 20.08.2020. The applicant has stated that they are a firm engaged in providing Professional & Technical Consultancy Service particularly in relatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to carry out any function entrusted to a Municipality under article 243W of the Constitution or to a Panchayat under article 243G of the Constitution; (zfa) "Government Entity" means an authority or a board or any other body including a society, trust, corporation, (i) set up by an Act of Parliament or State Legislature; or (ii) established by any Government, with 90 per cent or more participation by way of equity or control, to carry out a function entrusted by the Central Government, State Government, Union Territory or a local authority;] (3) Dissecting definition of Governmental Authority, following two main conditions emerges: first is Authority or board or any other body i) Must be set up by an Act of Parliament or a State Legislature; or ii) Established by any Government with 90 per cent or more participation by way of equity or control second is to carry out any function entrusted to a Municipality under article 243W of the Constitution or to a Panchayat under article 243G of the Constitution Whether & how RUDA satisfies above conditions? Yes, RUDA satisfies above conditions as under: RUDA is an Authority, set up by an Act of State unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... society, including the handicapped and mentally retarded. 10. Slum improvement and upgradation. 11. Urban poverty alleviation. 12. Provision of urban amenities and facilities such as parks, gardens, playgrounds. 13. Promotion of cultural, educational and aesthetic aspects. 14. Burials and burial grounds; cremations, cremation grounds; and electric crematoriums. 15. Cattle pounds; prevention of cruelty to animals. 16. Vital statistics including registration of births and deaths. 17. Public amenities including street lighting, parking lots, bus stops and public conveniences. 18. Regulation of slaughter houses and tanneries. (6) Power & Functions of RUDA are vested vide section 23(1) of The Gujarat Town Planning & Urban Development Act, 1976. The same are reproduced herein below: (i) To undertake the preparation of the Development Plan for the Urban Development Area. (ii) To undertake the preparation of Town Planning Scheme. (iii) To guide, direct and assist the local authorities and other statutory authorities functioning in Urban Development. (iv) To guide, direct and assist the local authorities of authority and other statutory authorities function in U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ciety, trust, corporation. Further if any of these entities' carry out function entrusted by the Central Government, State Government, Union Territory or a local authority then they are squarely eligible to be recognised as Government Entity. Thus, in their opinion, RUDA falls even in Government Entity also reason being it is set up by an Act of State Government and carry functions entrusted by State Government through The Gujarat Town Planning & Urban Development Act, 1976. Resultantly, RUDA can be recognised as Government Entity equally. Summing up the above, RUDA is Governmental Authority & Government Entity as well. (9) It may please be noted that earlier Karnataka Authority for Advance Ruling in the case of M/s. V. K. Building Service Pvt. Ltd. held vide Ruling no. KAR ADRG 39/2019 that Bangalore Development Authority is Governmental Authority. Function of Bangalore Development Authority is nothing but Urban Development which are akin with those of Rajkot Urban Development Authority. Further Rajasthan Authority for Advance Ruling in the case of M/s. PDCOR Limited clearly held vide Ruling no. RAJ/AAR/2018-19/13 that Jaipur Development Authority as Governmental Authority. Tagl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7?" DISCUSSION & FINDINGS: 7. We have considered the submissions made by the applicant in their application for advance ruling, their additional submissions dated 15.08.2020 and 20.08.2020 as well as the arguments/discussions made by their representative Shri Sanat C.Makhecha, C.A. at the time of personal hearing. We have also considered the issues involved on which Advance Ruling is sought by the applicant. 8. At the outset, we would like to state that the provisions of both the Central Goods and Services Tax Act, 2017 and the Gujarat Goods and Services Tax Act, 2017 are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to similar provisions of the GGST Act. 9. Based on the submission of the applicant as well as the arguments/discussions made by the representative of the applicant during the course of personal hearing, we find that the issue to be decided is whether the Rajkot Urban Development Authority (Accredited Department of Gujarat State Government) falls under the definition of Government Authority or a Government entity as defined under para 2(z ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ite supplies involving supply of any goods) 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. Hence, three conditions are required to be satisfied for a service to be covered under subject entry of the notification which is as below: (1) It must be pure service not involving any supply of goods. (2) It must be provided to the Central Government or State Government or Union Territory or Local Authority or a Governmental Authority or a Government Entity. (3) It must be an activity in relation to any function entrusted to a (i) Panchayat under Article 243G of the Constitution; or (ii) Municipality under Article 243W of the Constitution. 12. On going through the above, it can be seen that the first condition to be verified is as to whether the services supplied by the applicant are pure services or otherwise. We, therefore, are of the opinion that if and only if, the first c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said letter which means that the applicant must have already entered into an agreement with the Rajkot Urban Development Authority for the said work. However, although the representative was asked to submit a copy of the aforementioned agreement, the same has not been submitted so far. We find that the applicant has devoted a major part of his submissions trying to prove or to establish that the Rajkot Urban Development Authority is covered under the definitions of Governmental Authority or Government Entity. We find that they have also referred to the Gujarat Town Planning & Urban Development Act, 1976, Question no.25 of FAQ on Government Services under Sectoral Series released by CBEC, list of the functions entrusted to a municipality under Article 243 W of the Constitution of India etc. However, they have hardly devoted any space in their submission to prove the fact that the services supplied by them to the Rajkot Urban Development Authority are pure. They have not even submitted the copy of the agreement made by them with the Rajkot Urban Development Authority with respect to the aforementioned service supplied by them. Here, we would like to emphasise that the primary condit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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