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TMI Blog2019 (2) TMI 1999X X X X Extracts X X X X X X X X Extracts X X X X ..... . Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provisions under the UK-GST Act. BRIEF FACTS OF THE CASE 1. In the instant case the Party M/s NHPC Limited, Tanakpur Power Station, Banbasa, Uttarakhand, vide their application under sub-section (1) of Section 97 of the CGST/SGST Act, 2017 sought an Advance Ruling on the following issues: A. Whether they are required to pay. GST under reverse, charge in, terms of Notification No. 13/2017 dated 28.06.2017 while making payment to PWD, Uttarakhand for construction of road; B. What is the time of supply when advance payment is released to PWD, Uttarakhand; C. Whether the amount deposited with Central Fund i.e Uttaranchal CAMPA and reimbursed by MEA considering as part cost of the road is liable for GST. 2. Following the personal hearing given to the applicant on 27.09.2018, the Authority for Advance Ruling for the State of Uttarakhand vide Advance Ruling Order No. 10/2018-19 dated 22.10.2018 held that: (i) No GST is applicable on the activity of the applicant since the same falls under exempted services in terms of Notification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not a contractor rather in this present case it is Government Contractee. 5. Similarly, as per Para-6 of the order of AAR, an MoU is to be signed between and PWD Government of Uttarakhand for the said project. Thus, it is not the case where NHPC is awarding work-contract to- PWD. Relation of contractee-contractor is also not created between NHPC and PWD by virtue of this MoU. This only creates the relationship of partners among the parties. This fact is also confirmed by Minutes of meeting of Ministry of External Affairs (Northern Division) to review implementation of 1.3 Km road connecting Tanakpur Barrage to Mahendranagar, Nepal dated 13.04.2018 (E-II/112/02/2018). Para-6 of the. Minutes states that NHPC, along with the. State Government of Uttarakhand, will work out the funding requirements for building the link road and will take necessary action steps on an urgent basis to construct the link road, including preparing a suitable alignment linking Tanakpur barrage to road head on the Nepalese side. 6. The AAR has misconstrued delegation of project as award of work contract from MEA to NHPC and further from NHPC to PWD. If we go by the logic and conception cited in the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be applied while interpreting a tax exemption provision/notification when there is an ambiguity as to its applicability with reference to the entitlement of the assessee or the rate of tax to be applied?", and had held that- (1) Exemption notification should be interpreted strictly; (2) When there is ambiguity in exemption notification which is subject to strict interpretation, the benefit of such ambiguity cannot be claimed by the subject/assessee and it must be interpreted in favour of the revenue. (3) The ratio in Sun Export case (supra) is not correct and all the decisions which took similar view as in Sun Export Case (supra) stands over-ruled. In light of the ratio, laid down by the constitutional bench of the Hon'ble Apex Court in above case, the hypothetical & liberal interpretation of the legal provisions as decided by the Authority of Advance Ruling cannot be allowed usurp the actual and strict interpretation of the law. 9. In the present case, AAR has extrapolated the recommendations made on GST rate changes on services by 25th GST council meeting. In the said meeting it was decided "to reduce GST rate (18% to 12%) on the Works Contract Services. (WCS) provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were to be repaid by MEA from their account head 'Aid to Nepal'. So the government aid was allotted to MEA and not to NHPC. In the minutes of -meeting dated 19-04-18 to review the implementation of the said project (Supra), it was agreed upon that the NHPC, along with State government of Uttarakhand will take necessary steps on an urgent basis to construct the link road, including preparing a suitable alignment linking Tanakpur barrage to road head on the Nepalese side. It was also agreed that the road alignment would be shared with the. Nepalese side on a priority basis. NHPC along with the State government of Uttarakhand, will work out the funding requirement for building the link road. Following the same, NHPC as the implementing agency delegated the responsibility of completing the project to PWD (construction agency) and a Memorandum of Understanding was made between these two agencies. To implement the project, works contract was allotted by PWD through an open tender to their contractor M/s RG Buildwell Engineering Pvt. Ltd. In view of these facts, it is clear that no GST is payable by NHPC on reverse charge or otherwise on the payments for this project that is/wil ..... X X X X Extracts X X X X X X X X Extracts X X X X
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