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TMI Blog2022 (4) TMI 914X X X X Extracts X X X X X X X X Extracts X X X X ..... oviding drainage arrangement etc. wherein, the total earth work is approximately 91% and construction work is around 9% wherein transfer of property is involved and held that the activity of the Principal Contractor, part of which is outsourced to the applicant, is a Composite supply of works contract as defined in clause (119) of Section 2 of the CGST Act, 2017, where such supply is to a Governmental Entity, i.e. GMIDC. Further we also held that, the Principal Contractor s supply is to a Government Entity, i.e. GMIDC and the said work has been procured by GMIDC in relation to work entrusted to it by the State Government of Maharashtra. Since it is already held that the activity of the Principal Contractor is not covered under Sr. No 3A- Chapter No. 9954 as per Notification No. 12/2017-C.T. (Rate) dated 28.06.2017, as amended from time to time, in the subject case also relying on the same ratio we are of the opinion that the applicant cannot avail the benefit of Sr. No 3A- Chapter No. 9954 as per Notification No. 12/2017-C.T. (Rate) dated 28.06.2017, as amended. Composite supply of works contract as defined in clause (119) of section 2 of the CGST Act, 2017 provided by a sub-contra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 25.01.2018, whether we can avail the benefit of the same tax rate i.e. NIL? B) If the above answer is negative, then whether we can avail the benefit of SI No 3 (x) - Chapter No. 9954 as per Notification No. 01/2018-C.T. (Rate) dated 25.01.2018 (amendments in the Notification No 11/2017- Central Tax (Rate) dated 18th June 2017)? At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to any dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, the expression 'GST Act' would mean CGST Act and MGST Act. 2. FACTS AND CONTENTION - AS PER THE APPLICANT FACTS: 2.1 M/s. Mahalaxmi B T Patil Honai Constructions JV (Referred to as JV/Main Contractor) a GST registered company situated 363/11, Balaji Niwas, Shivajinagar, Pune-411 016, engaged in the business of Construction of infrastructure projects was formed to undertake construction of Jeur Tunnel under (Linking Ujani Reservoir to Sina, Kolegaon reservoir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Eleventh Schedule of Article 243G of the Constitution which covers "Minor Irrigation, water management and watershed development" and Sr. No. 5 of Twelfth Schedule of Article 243W of the Constitution which covers "Water supply for domestic, industrial and non-commercial purposes" would cover the activities carried out by the JV and on the same line we as a JV member can also take the benefit of NIL rate of tax. WRITTEN SUBMISSION DATED 24.03.2022:- 2.8 Applicants construction work includes Earth Work such as excavation for tunnel, removing of excavated stuff, providing steel support, rock bolting, reinforcement, fixing of chain link, cement concreting etc. 2.9 An identical case involving identical set of questions in the matter of Soma Mohite Joint Venture was decided in favour of the Applicants by the Maharashtra Appellate Authority for Advance Ruling. It is submitted that contract relating to Soma Mohite Joint Venture was identical to the contracts involved in the instant case and even the project is one and the same added by GMIDC. Therein, it was held that the work carried out by the Applicant JV was covered by Entry 3(vii) of Notification No. 11/2017-CTR as amended by No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on No. 11/2017-Central Tax (Rate). 03. CONTENTION - AS PER THE CONCERNED OFFICER: Officer Submission dated 10.01.2022:- Question No. 1 3.1 Comments: Applying the ratio of order No. MAH/AAAR/SS-RJ/21/2019-20 dated 20.01.2020 passed by the Maharashtra Appellate Authority for Advance Ruling for Goods and Service Tax In case of M/s Soma Mohite Joint Venture wherein similar issue regarding applicability of Sr.No. 3A as per Notification No. 12/2017-CTR as amended has been decided, it appears that the impugned contract is not covered under Sr.No. 3A of Notification No. 12/2017-CTR dated 28/06/2017 as amended. Consequently the reply to the appellant's question is in negative. Question No. 2 3.2 Comments:- Sr.No. 3 (x) of the relevant Notification is reproduced as under; (1) (2) (3) (4) (5) 3 Ch. 9954 (x) Composite supply of works contract as defined in clause (119) of Section 2 of the Central Goods and Service Tax Act, 2017 provided by a sub-contractor to the main contractor providing services specified in 2.5% item (vii) above to the Central Government, State Government, Union territory a local authority a Govt. Authority or a Govt. Entity. 2.5% Provided that where the se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mala, Dist. Solapur, by the Godavari Marathwada Irrigation Development Corporation (GMIDC), Aurangabad. 5.3 The applicant, M/S BT Patil & Sons Belgaum Constructions Pvt Ltd has submitted that, the impugned contract/work order given to the Principal Contractor consists of Earth Work such as Excavation for Tunnel, removing of excavated stuff, fabrication, transporting, providing steel support, rock bolting, reinforcement, fixing of chain link, cement concerting, providing drainage arrangement etc. wherein total earth work is around 91% and construction work is approximately 9%, wherein transfer of property is involved. As per the applicant, impugned activity of the Principal Contractor is a Composite supply of works contract as defined in clause (119) of section 2 of the CGST Act, 2017, where such supply is to a Governmental y/Government Entity. 5.4 The applicant has submitted that the Principal Contractor has outsourced fifty percent of the work as per the contract to the applicant. While making detailed submissions regarding the activity of the Principal Contractor, the applicant has also submitted that, the two questions raised are in respect of impugned supply provided to the P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relation to work entrusted to it by the State Government of Maharashtra. 5.7.2 Applying the ratio of the decision of the Maharashtra Appellate Advance Ruling Authority in the case of Soma Mohite Joint Venture, in an application filed by the Principal Contractor i.e. M/s. Mahalaxmi B T Patil Honai Constructions JV before this authority, we have held in our order that, the Maharashtra Appellate Advance Ruling Authority's decision in the case of Soma Mohite Joint Venture is squarely applicable in the case of the Principal Contractor and the impugned activity of the Principal Contractor falls under Sr. No. 3 of Notification No. 11/2017-CTR dated 28.06.2017 as amended from time to time. 5.8 With respect to the first question asked by the applicant, since we have already held that the activity of the Principal Contractor is not covered under Sr. No 3A- Chapter No. 9954 as per Notification No. 12/2017-C.T. (Rate) dated 28.06.2017, as amended from time to time, in the subject case also relying on the same ratio we are of the opinion that the applicant cannot avail the benefit of Sr. No 3A- Chapter No. 9954 as per Notification No. 12/2017-C.T. (Rate) dated 28.06.2017, as amended. 5.9.1 I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; Providing and fabrication, transporting and erecting structural supports ; Providing and rock bolting in position (work order in running meter) ; Providing and fixing in position M.S. reinforcement; Providing and applying material component shot crating in two layers ; providing ad fixing chain link ; providing and laying in situ cement concrete in grade M-15 ; Providing and laying in situ cement concrete in grade M-20 ; removing excavated stuff from underground excavation ; providing drainage arrangement and bailing out water, etc. 5.9.5 The work items mentioned in 5.9.4 above are a part of the work allotted to the applicant by the Principal Contractor and we have already held that the supply of the Principal Contractor is a composite supply of works contract since there is a combination of supply of goods as well of services. 5.9.6 The Composite supply of works contract is provided by the applicant sub-contractor to the main contractor who is further providing services specified in item (vii) to the Central Government, State Government, Union territory, a local authority, a Governmental Authority or a Government Entity. 5.9.7 In view of the above we find that the impugned s ..... 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