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TMI Blog2024 (2) TMI 1352X X X X Extracts X X X X X X X X Extracts X X X X ..... ctive of the project is not just land reclamation but also bio mining of waste, which involves processing of waste and disposal of the same as well. Therefore, this part of the operation gets covered under Group 99943, and more specifically under SAC 999433, which relates to 'Non-hazardous waste treatment and disposal services'. Accordingly, we are of the opinion that broadly, the entire operation undertaken by the applicant in this case gets covered under SAC heading 9994, attracting 18% GST. Whether services provided by the applicant are exempted under SI. No. 3 of Notification No. 12/2017 dated 28.07.2017 as amended? - HELD THAT:- The service 'Site remediation and bio mining of waste', docs not fall under the category of cither Works Contract', or 'Composite supplies'. Further, as no supply of any goods is involved in the instant case, and as said operation gets carried out by deployment of manpower/labour, it is clear that the service rendered by the applicant qualifies as 'pure services' - By virtue of Government Notification No. HUD 474 MLR 95, dated 10.10.1995, Tumkur was specified as City Municipal Council Area , and vide Notificati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act shall be binding only- (a) on the applicant who had sought it in respect of any matter referred to in subsection (2) of section 97 for advance ruling; (b) on the concerned officer or the jurisdictional officer in respect of the applicant. 3. In terms of Section 103(2) of the Act, this advance ruling shall be binding unless the law, facts or circumstances supporting the original advance ruling have changed. 4. In terms of Section 104 of the Act, where the Authority finds that advance ruling pronounced by it under sub-section (4) of Section 98 or under sub-section (1) of section 101 has been obtained by the applicant by fraud or suppression of material facts or misrepresentation of facts, it may, by order, declare such ruling to be void ab initio and thereupon all the provisions of this Act or the rules made thereunder shall apply to the applicant as if such ruling had never been made. 5. At the outset, we would like to make it clear that the provisions of both the Central Goods and Service Tax Act and the Tamil Nadu Goods and Service Tax Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iction the taxpayer falls, have vide their letter dated 17.05.2023, stated that, Solid waste management services provided by the applicant fall under SAC code 9994 attracting 18% (IGST), or 9% (CGST) 9% (SGST), as per Notification No. 11/2017-CT dated 28.06.2017. The services provided by the applicant appear to be Pure Services in nature falling under chapter heading 99, as specified in SI. No. 3 of the exemption Notification No. 12/2017 dated 28.07.2017. However, to claim exemption from payment of GST, such services are to be provided to Central Government, State Government, local authority or Governmental authority, by way of an 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. With respect to the question whether M/s. Tumkur Smart City Corporation is a Governmental authority , it is seen that the said body is a Special Purpose Vehicle (SPV) owned by M/s. Tumkur City Corporation and Karnataka State Government in 50 : 50 ratio, and accordingly, M/s. Tumkur Smart City Corporation cannot be considered as a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er requested the representative to specify whether they raise their invoice in the instant case to Tumakuru City Corporation, or to Tumakuru Smart City Corporation, to which the representative replied that she will check up and provide copies of the invoices raised by them in this regard. She further undertook to furnish any other clarification/document in relation to this application as and when called for by the Advance Ruling authorities. DISCUSSION AND ANALYSIS 7.1 We have carefully considered the submissions made by the applicant in the advance ruling application, the additional submissions made during the personal hearing and the comments furnished by the 'CENTER' Tax Authorities. The applicant filed advance ruling application under Section 97(2) of GST Act, 2017. 7.2 From the submissions made at the time of filing the application, it is seen that the applicant who are into Solid Waste Management services, has been assigned with the task of Remediation of open dump and reclamation of open dump and reclamation of space at Ajjagondanahalli, Tumakuru by M/s. Tumakuru City Corporation, Tumakuru - 572102. Under these circumstances, the applicant had sought a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut has been referred to as Tumkur', 'Tumukuru' and 'Tumakuru'. Further, it is seen from the letter No. TSCL/TENDER/CR/83/2020-21 dated 30.12.2021 ('Notice to proceed with the work'), that the same carries the reference 'Tumakuru City Corporation, Tumakuru in the letter head, whereas the identity of the signing authority has been referred as Executive Engineer, Tumkur City Corporation, Tumkur in the same letter. From online resources, it is seen that 'Tumkur' was officially renamed as 'Tumakuru' in the year 2014. Therefore, wherever the reference 'Tumkur' appears in this text, the same may be taken to mean 'Tumakuru'. 8.4 Moreover, since two entities/bodies viz., M/s. Tumakuru City Corporation and M/s. Tumakuru Smart City Limited are involved in the instant ease, it becomes imperative to analyse the respective roles of these bodies in relation to the transactions involved in this issue, in order to proceed further in this ease. 8.5 As could be seen from the Agreement dated 30.12.2021 for the project in question, that the same has been executed by the Executive Engineer, Tumkur City Corporation, Tumkur as the Em ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Purpose Vehicle (SPV) in respect of 6 cities, viz., Davanagri, Bclagavi, Hubbali Dharwad, Mangaluru, Shivamogga and Tumakuru . It has also been proposed that the name of SPV shall be City name followed by the words SMART CITY LIMITED , and that the SPV shall be a public limited company incorporated under the Companies Act, 2013, in which the State and the Urban Local body will be the promoters having 50:50 equity shareholdings. 8.8 In view of the detailed discussions above, and in view of the fact that Authority-1 (TCC) had authorized Authority-2 (TSCL) to invite tenders for the said project, it becomes clear that M/s. Tumakuru Smart City Limited is only a Special Purpose Vehicle (SPV) created specifically to facilitate the Parties for seamless execution of the project, and to make payments to the selected Agency/contractor, on approval of the bill by Authority-1 (TCC). Accordingly, it becomes clear that in the instant case, M/s. Tumakuru City Corporation is the principal/service recipient, in as much as they are the body that has entered into a project agreement dated 30.12.2021 with M/s.Gorantla Geosynthetics Private Limited, who are the contractor/service provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te upto 25% over and above the estimated waste to be processed for which no extra cost shall be paid. 9.2 In common parlance, the term 'Legacy Waste', refers to the wastes collected and kept for years on any barren land or on a dedicated landfill, and the term 'Bio mining' refers to an environment friendly technique to separate soil and recyclables like plastic, metal, paper, textiles, Construction Demolition waste materials and other solid materials from legacy waste. From the terms of the Agreement relating to 'Project Scope' in particular, we find that the applicant is involved in 'reclamation of land parcel (at Ajjagondananhalli) of an existing dumpsite through Bio miming' and 'disposal of the output (Waste fractions) from the processing operation', whereby the applicant is expected to process approximately 77,500 cubic meters of legacy waste. 9.3 Accordingly, it becomes clear that the applicant is a Solid Waste Management company which offers solutions involving segregation, treatment, recycling of Legacy Waste and thus clearing and reclaiming the landfills. In the process, the applicant is also expected to dispose of the w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iation' in the instant case gets covered under Group 99944, and more specifically under SAC 999441, as the applicant is assigned with the task of Remediation of open dump and reclamation of open dump and reclamation of space at Ajjagondanahalli, Tumakuru . However, the objective of the project is not just land reclamation but also bio mining of waste, which involves processing of waste and disposal of the same as well. Therefore, this part of the operation gets covered under Group 99943, and more specifically under SAC 999433, which relates to 'Non-hazardous waste treatment and disposal services'. Accordingly, we are of the opinion that broadly, the entire operation undertaken by the applicant in this case gets covered under SAC heading 9994, attracting 18% GST. 9.6 Moving on to the second query relating to the exemption provided under SI. No. 3 of the Notification No. 12/2017 CT dated 28.06.2017, as amended, it is seen that the entry at SI. No. 3 of the said Notification, reads as below Sl. No. Chapter, Section, Heading, Group or Service Code (Tariff) Description of Services Rate (per ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent 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 of the Constitution; or (g) a Regional Council constituted under article 371A of the Constitution; 9.8.2 Clause (c) of article 243P of the Constitution defines Municipality ', which reads as (e) Municipality means an institution of self-government constituted under article 243Q; 9.8.3 Article 243Q speaks about the constitution of Municipalities and as per clause (c) of Article 243Q, Municipal Corporation is also considered as Municipality. Article 243Q reads as below: 243Q. Constitution of Municipalities. - (1) There shall be constituted in every State, - - (a) a Nagar Panchayat (by whatever name called) for a transitional area, that is to say, an area in transition from a rural area to an urban area; (b) a Municipal Council for a smaller urban area; and (c) a Municipal Corporation for a larger urban area, in accorda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. The services in question are covered under SI. No. 6 of Article 243 W of the Constitution of India i.e. Public health, sanitation conservancy and solid waste management. 9.11 Further, it is seen that as per the Solid Waste Management Rules, 2016, the duties of local authorities are given under Rule 15. Sub-clause (zj) to Rule 15 reads as - investigate and analyze all open dumpsites and existing operational dumpsites for their potential bio-mining and bio-remediation and wheresoever feasible, take necessary actions, to bio-mine or bio-remediate the sites; 9.12 We therefore find that the services rendered by the appl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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