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TMI Blog2022 (7) TMI 749X X X X Extracts X X X X X X X X Extracts X X X X ..... ecution. AAR. Odisha vide Order dated 09.03.2021 held that M/s SAIL, Rourkela qualifies to be called and termed as a Government Entity' and the works contract service which is being supplied by M/s URC Construction Private Limited would merit entitlement for concessional rate of GST @ 12% in terms of Notification No. 11/2017-Central Tax (Rate), dated 28-6-2017 (and as amended). It has been observed that all the pre-requisites as stipulated in para 6.4 are satisfied /fulfilled for the supply to qualify for the notified exemption. Accordingly. we hold that M/s SAIL. Rourkela qualifies to be called and termed as a Government Entity for the purpose of GST law. Therefore, the supply of works contract service which is being supplied to M/s SAIL. Rkl for construction of ISPAT Post Graduate Medical Institute and Super Specialty Hospital would merit entitlement for concessional rate of GST @ 12% in terms of Notification No. 11/2017-Central Tax (Rate), dated 28-6-2017 9and as amended). - 01/ODISHA-AAR/2022-23 - - - Dated:- 20-5-2022 - SRI GOPAL KRISHNA PATI, IRS, AND SRI P.K. MOHANTY, OFS(SS), MEMBER Present for the Applicant in the hearing : Tarun Kumar Agrwalla, CA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ruling have paid 18% of tax on its Tax invoices raised to M/s SAIL pertaining to the underlying subject contract, whether the taxes to the extent of 6 % (18% paid-12% as per order) becomes taxes paid over and above the liability to pay as tax and can be regarded as tax in excess? d) For that matter whether the excess tax to the extent of 6% so paid would be eligible to be refunded under Section 54 of the CGST Act, 2017? e) What would be the proper procedure under GST provisions for claiming the excess amount so paid? 4.0 Submission of the Applicant 4.1 It was submitted that the Applicant had entered in to a Memorandum of Understanding (MoU) on 13-08-2018 with M/s. Steel Authority of India Limited (SAIL) wherein the Applicant has been entrusted/ awarded the work relating to planning, designing and construction of 'ISPAT POST- GRADUATE MEDICAL INSTITUTE AND SUPER SPECIALTY HOSPI I AL at Rourkela Steel Plant (RSP), Rourkela. 4.2 As per Para 2.0 of the MOU, the Applicant has acted as an executing agency of the project as deposit work on a turnkey basis. Accordingly, the Applicant proceeded to execute the same by appointing M/s URC Construction (P) Ltd., as a EP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (vi) (a) and (b) of Notification No. 11/2017- Central Tax (Rate) dated 28.06.2017. The Applicant has contended that following pre-requisites are to be satisfied by the supply so made in order to qualify for the notified exemption: (i) Supply must be Composite Supply of Works Contract Service provided or to be provided by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of- (a) civil structure or any other original works meant predominantly for use other than for commerce industry or any other business or profession; (b) a structure meant predominantly for use as (i) an educational (ii) a clinical, or (iii) an art of cultural, establishment,. (ii) Services are provided to Central Government, State Government, Union Territory, a local authority, Governmental Authority or Government Entity. (iii) If the services provided to Government Entity, then the services shall he procured by the Government entity in relation to a work entrusted to it by the Central Government, State Government, Union territory or local authority. 4.7 It is submitted that the Applicant is awarded a com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that relying on the findings of this Bench in earlier ruling mentioned supra, it can be inferred that the nature of supply made by the Applicant to M/s SAIL vide MoU dated 13.08.2018 is a Works Contract service under Central Goods and Services Tax Act,2017 (Odisha State Goods and Services Tax Act, 2017) and the entire contract is eligible for specific rate of tax at 12% (State Centre Combined) classifiable under Sr. No. 3 (vi) (a) or (b) (Classification Code 9954) of the table in the Notification No. 11/2017-Central Tax (Rate) dated 28-06-2017. 4.11 It is submitted that, the determination of the rate of tax would be effective from the date of effect of the said notification and not from the date of the ruling. 4.12 The Applicant has submitted that the classification and applicable rate of taxes on the entire value of services under the subject MoU between the Applicant and M/s SAIL is at the rate of 12% and the taxes already paid @ 18% during the period are taxes in excess and are eligible amount for application of refund. 5.0 Personal hearing was fixed on 30.03.2022 under due intimation to the Applicant. Sri Tarun Kumar Agrawalla, CA appeared for P H on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t predominantly for use other than for commerce, industry, or any other business or profession; (b) a structure meant predominantly for use as (i) an educational, (ii) a clinical, or (iii) an art or cultural, establishment; or (c) Explanation . 6 Provided that where the services are supplied to a Government Entity, they should have been procured by the said entity in relation to a work entrusted to it by the Central Government, State Government, Union territory or local authority, as the case may be 6.4 On plain reading of the entry, it is clear that the following pre-requisites are to be satisfied for the supply to qualify for the notified exemption. (i) Services provided by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of (a) civil structure or any other original works meant predominantly for use other than for commerce. industry, or any other business or profession; (b) a structure meant predominantly for use as (i) an educational (ii) a clinical, or (iii) an art or cultural, establishment; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning of any immovable property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of such contract. We see that the Applicant had entered in to a Memorandum of Understanding (MoU) on 13-08-2018 with M/s. Steel Authority of India Limited (SAIL) wherein the Applicant has been entrusted/ awarded the work relating to planning, designing and construction of ISPAT POST-GRADUATE MEDICAL INSTITUTE AND SUPER SPECIALLY HOSPITAL at Rourkela Steel Plant (RSP), Rourkela. It is also -seen that the Applicant has executed the same by appointing M/s URC Construction (P) Ltd (Sub-Contractor) vide Letter of Award dated 15.01.2019 to carry out the project. As per the Applicant the scope of work includes supply of all goods and services required for completion of the contract. Further, the said contract is for construction of immovable property (i.e. construction of building) wherein transfer of property in goods is involved in the execution of such contract which would fall within the ambit of works contracts as defined under Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government Entity , we would like to reproduce the relevant portion of the said order as under. Para 3.10: it was submitted that though the Government Holding of M/s. SAIL as on 31st March 2019 would be around 85% as disclosed under SERI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Steel Authority of India Limited was established as 100% owned by Government of India. Thereafter. in the year 1995. the same was listed on the National Stock Exchange and the holding of Government of India was diluted Para 4.8: xxxxxxxxxxxxxxxxxxxxxxxxxxx Now let us examine as to whether M/s. SAIL, RSP is a Government Entity in terms of explanation 4(x) to the aforesaid notification. As per Explanation 4(x), 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, Slate Government, Union Territory or a local authority. Para 4.9: From the above, it is clear that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Government of India, for the month of June 2018 and provides that the project would fulfil the medical requirement of the people of Rourkela and neighboring districts and states. (d) MOU executed between SAIL and NBCC which provides that the amount shall be paid to the Applicant only after receipt of sanctioned amount from Government of India. Para 4.12: Needless to say that in the given circumstances (as stated and discussed in foregoing paras, M/s SAIL, Rourkela qualifies to be called and termed as a 'Government Entity' for the purpose of GST law, as it fulfils the necessary and sufficient conditions laid down under notification supra. It therefore leaves no doubt that M/s SAIL, Rourkela is a Government Entity for the purpose of provisions of CGST Act, 2017 and OGST Act, 2017. 6.9 in the instant case, it is observed that the MoU was entered into between the Applicant and M/s SAIL for construction of Ispat Post Graduate Medical Institute and Super Specialty Hospital at Rourkela Steel Plant. Subsequently, the said work was entrusted to M/s URC Construction (P) Ltd (the sub contractor of the Applicant) for execution. AAR. Odisha vide Order dated 09.03.202 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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