9911796707
TMI Blog2022 (7) TMI 499X X X X Extracts X X X X X X X X Extracts X X X X ..... rred to as applicant), registered under the AP Goods & Services Tax Act, 2017. 3. Brief Facts of the case: 3.1 The applicant, M/s Keshav Projects is engaged in 'supply of manpower' for preparation and serving of spot electricity Bills to Andhra Pradesh Central Power Distribution Corporation Limited (APCPDCL) with 18% GST (SAC -00440410) as per the terms of the contract. Scope of work: Preparation and serving of spot electricity bills in consumer premises of LT Cat-I, Cat-II and Cat-IV (D&E) (excluding High Value and Agricultural Services) with GPRS enabled spot billing machines with/without IR/IRDA port readings in specified areas in (consisting of both urban and rural areas) of state of Andhra Pradesh. 3.2 Andhra Pradesh Central Power Distribution Limited (hereinafter referred to as APCPDCL) is a limited company set up by Government of Andhra Pradesh in which 99% of shares are held by Governor of Andhra Pradesh. The APCPDCL is responsible to engage in the business procurement, supply, and distribution of electricity in specified areas (both rural and urban) of the state of Andhra Pradesh. The applicant submits that the APCPDCL argues that services provided to them are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dates. 5.3 The applicant rendering supply of manpower for preparation and serving of spot Electricity bills services during implementation will ensure that the contracts are completed with least cost and no time overruns and ensure that quality and sustainable assets are sustained. 5.4 Details of the services rendered under contract agreement: 1. The spot billing agency shall procure adequate number of hand held computers and also stationary and other requirements for issue of spot bill. The bill format shall be as APCPDCL specifications. The agency shall keep adequate no of SBMs to meet contingency like repairs etc. 2. The spot billing agency shall appoint persons able to read different kinds of electrical meters and their status and sufficient knowledge to operate the spot billing machines. 3. The spot billing agency shall bill the services as per Schedule transformer wise and complete the work well within the schedule dates. 4. The spot billing agency has to visit the consumer premises where the service connection is located and metered and take reading with IR/IRDA port/ manually and enter the same in the spot billing machine and generate bill. The bill should be serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oid unnecessary billing grievances and postponement of revenue. 14. Penalties : The APCPDCL reserves the right to levy penalties in the following cases in respect of spot billing activity. a) If the spot bills are not served to the consumers, penalty of Rs. 5/- for each service to be levied. b) No payment to spot billing bills served after the grace period of 2 days from the scheduled dates. c) Exceptional i.e., Door lock and RNF cases should not exceed 5% of the total services to be billed, if exceptional exceeds 5% of the total services to be billed, then the APCPDCL shall recover penalty for an amount equivalent to 5% of total bills of sub division d) No payment will be made for services with wrong readings, reading not furnished (08) and door lock (05) status in final exceptional given by spot billing agency. If any service continuously under these status for 3 months penalty will be levied @ Rs.10/- per such service. e) If the bills are prepared on the basis of table readings and if any suppression of readings, revenue loss and other activity which causes loss or damage to the department is notices, the Dept. has right to black list the agencies and communicate to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e quality of the service of the spot billing agency is not satisfactory continuously month after month and does not improve to establish the system of continuous spot billing in its real spirit the agreement is liable for termination with one month notice at any time during the subsistence of this agreement. 24. The bills are liable for TDS such as income tax and other taxes at the rates as per the enactments of Govt of India and Govt of Andhra Pradesh from time to time. 25. GST as per rules 26. If, in the view of superintending Engineer/operation /CRDA Circle/Amaravathi the execution of the work is felt to be slow and now not being done satisfactory as per the terms and conditions of the contract the superintending Engineer/Operation/Circle/Guntur reserves the right to terminate the work temporarily/ permanently and to arrange to carry out the job of spot billing of the sub- division/section/distribution either departmentally or by other agency. The superintending engineer shall determine the agreement in giving notice in writing if the agency fails to execute the works either in full or in part of it. The conduct of the agency or any of those employed by him and working on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the following issues, as mentioned below: 6. Applicant's Interpretation of Law: 6.1 Whether the 'Supply of Manpower for preparation and serving of spot electricity bills services provided to the extent of such services provided in rural areas' services provided to Andhra Pradesh Central Power Distribution corporation limited (APCPDCL) can be termed as 'Pure Services' as referred in SI.No.3 - (Chapter 99) of table mentioned in Notification No. 12/2017 - Central Tax (Rate) dated 28.06.2017 and accordingly eligible for exemption from Central Goods and Service Tax and SI.No.3 - (Chapter 99) of Table mentioned in G.O.Ms. No.588 - (Andhra Pradesh) State Tax (Rate) dated 12.12.2017 and accordingly eligible for exemption from Andhra Pradesh Goods and Service Tax. The relevant portion of the Notification No.12/2017 -Central Tax (Rate) dated 28.06.2017 has been reproduced for interpretation, which is as follows: .............................. "In exercise of powers conferred by sub-section (1) of section 11 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on being satisfied that it is necessary in the public interest so to do, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cluded. However, CBEC vide FAQ on Government Services, has clarified the scope of pure Services as under: Question 25: what is the scope of 'pure services' mentioned in the exemption notification no.12/2017 - Central Tax (Rate) dt: 28.06.2017? Answer: in the context of the language used in the notification, supply of services without involving any supply of goods would be treated as supply of pure services. For example, Supply of manpower for cleanliness of roads, public places, architect services, Consulting engineer services, advisory services, and like services provided by business entities not involving any supply of goods would be treated as supply of pure services. On the other hand, let us take example of a governmental authority awarding the work of maintenance of street lights in a Municipal area to an agency which involves apart from maintenance, replacement of defunct lights and other spares. In this case, the scope of the service involves maintenance work and supply of goods, which falls under the works contract services. The exemption is provided to services which involves only supply of services and not for works contract services. The term 'Works Cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rticle 243G of the Constitution." The definition of 'Local Authority' as defined in section 2 (69) of CGST Act, 2017, is stated as under: "Local authority" means - (a) a "Panchayat" as defined in clause (d) of article 243 of the Constitution; (b) a " Municipality" as defined in clause (e) of article 243P of the Constitution; (c) a Municipal Committee, a Zilla Parishad, a District Board, and any other authority legally entitled to, or entrusted by the Central Government or any State Government with the control or management of a municipal or local fund; (d) a Cantonment Board as defined in section 3 of the Cantonments Act, 2006; (e) a Regional Council or a District Council constituted under the sixth schedule to the constitution; (f) a Development Board constituted under article 371 and article 371] of the Constitution; or (g) a Regional Council constituted under article 371A of the Constitution. The APCPDCL was formed during the year 2019 by the Government of Andhra Pradesh. It functions directly under the Department of energy of the Government of Andhra Pradesh and in which 99% shareholding are in the hands of Honorable Governor of Andhra Pradesh. Hence, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bills services, being a 'Pure Service', provided by the Applicant to APCPDCL being a 'Local Authority' would be eligible for exemption under entry 3 of the notification no 12/2017- Central Tax (Rate) dt:28.06.2017 as such activity qualify to be in relation to functions entrusted to panchayat under Article 243G of the Constitution. 6.5 Prayer of the Applicant: * The 'Supply of Manpower for preparation and Serving of Spot Electricity Bills Services" provided by the Applicant in rural areas has no component of supply of goods and is eligible to be a 'Pure Service'. * Considering the definitions of Governmental Authority and Local Authority and the facts of APCPDCL, APCPDCL, qualifies to be a ' Local Authority set up and governed by the Energy department of the Government of Andhra Pradesh. * The services provided by the Applicant to APCPDCL, is Supply of Manpower for preparation and serving of Spot Electricity Bills Services in Rural areas which is listed in Eleventh Schedule to Article 243G of the Constitution as functions of Panchayat. * Considering the above mentioned, the Supply of Manpower for Preparation and Serving of Spot Electricity B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n covers the procurement of goods as well in addition to the services, disqualifying the present supply to be covered under the concept of 'pure services'. Hence the exemption clause under entry SI.No.3- (Chapter 99) of table mentioned in Notification No.12/2017- Central Tax (Rate) dated 28.06.2017 is not applicable for the instant case. In view of the above, the rest of the issues like APCPDCL being a 'Local Authority' or the supply being one of the functions entrusted to panchayat under Article 243G of the Constitution, find no relevance to take up for further discussion. In view of the foregoing, we pass the following order. RULING (Under Section 98 of Central Goods and Services Tax Act, 2017 and the Andhra Pradesh Goods and Services Tax Act, 2017) Question: 1. Whether the "Supply of Manpower for preparation and serving of spot Electricity Bills' services provided to Andhra Pradesh Central Power Distribution Corporation Limited for Andhra Pradesh Rural Electrification including distribution of electricity (APCPDCL) can be termed as 'Pure Services' as referred in SI.No.3-(Chapter 99) of table mentioned in Notification No.12/2017-Central Tax (Rate) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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