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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 ..... 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 dissimilar provisions, a reference to the Central Goods and Service Tax Act would also mean a reference to the same provisions under the Tamil Nadu Goods and Service Tax Act. 1. The applicant submitted a copy of Electronic Cash Ledger evidencing payment of application fees of Rs. 5,000/- each under sub-rule (1) of Rule 104 of CGST Rules 2017 and SGST Rules 2017. 2.1 The applicant, a GST Registrant, is a Private Limited company under the Administrative cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o 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 "Governmental Authority". * As the applicant is providing service to M/s. Tumkur Smart City Corporation which is not a governmental authority as per the definition provided in para 2(zf) of Notification No. 12/2017 dated 28.07.2017, the exemption is not available to them. 4. The jurisdictional State authority has not furnished any reply in this regard, and it is construed that there are no proceedings pending on the issue raised by the applicant. 5. On interpretation of law, the appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions 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 an advance ruling, on the following aspects, viz., 1. Classification of the services provided by the applicant. 2. Whether services provided by the applicant are exempted under SI. No. 3 of Notification No. 12/2017 dated 28.07.2017 as amended? 3. Whether the service recipient i.e., M/s. Tumkur Smart City Corporation is a "Governmental Authority" as per the definition of Notification No. 12/2017-CT dated 28.06.2017? Prima facie, it is observed that while the first query relating to classification of services gets c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 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 Employer, with M/s. Gorantla Geosynthetics Private Limited, Chennai-600034, as the Contractor. Further the 'Notice to proceed with the work' vide Letter No. TSCL/TENDER/CR/83/2020-21 dated 30.12.2021 has also been issued by the Executive Engineer, Tumkur City Corporation, Tumkur. However, the tender process in this regard, is seen to have been carried out by Tumakuru Smart City Limited, Tumakuru, in as much as the 'Letter of Acceptance' in Letter No. TSCL/TENDER/CR/83/2020-21/604(1)/21-22 dated 18.10.2021 towards the award of Tender ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lear 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 provider. 9.1 Moving on to the services rendered by the applicant, it is seen that the technical specification of the project to be carried out has been mentioned as "Remediation of open dump and reclamation of open dump and reclamation of space at Ajjagondanahalli, Tumakuru". The authorized representative of the applicant explained during the personal hearing that their work gets covered as Biomining', which involves collection of solid waste, taking the same to the dumping site assigned by the Corporation, where the waste gets segregated in accordance with the requirements of the Corporation. On perusing the Project Agre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t 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 waste fractions from the processing operation scientifically in compliance with the applicable legal provisions. In short, applicant is seen to have been involved in 'Waste treatment and disposal services', and 'Site Remediation Services'. Under these circumstances, the applicant has sought a ruling on the classification of services provided by them. 9.4 Notification No. 11/2017 Central Tax (Rate), dated 28.06.2017 specifics the rates of GST for services, and it is seen that description of service in respect of SAC 9994 is "Sewage and waste collection, treatment and disposal and other environmental protection services" which is chargeable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the Central Government, State Government or Union territory or local authority by way of any 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. Nil Nil From the above, it is observed that in order to be eligible for exemption under the said category of service, the following conditions are required to be satisfied, viz., * The services must be pure services; * The services should be provided to Central Government, State Government or Union Territory, a local authority or a governmental authority; * The pure services must be by way of any 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. 9.7 As revealed from the details/documents furnished by the applicant, and in view of the detailed discussions above, it is quite evident that the service 'Site remediation and bio mining of waste', docs not fall under the category of cither Works Contract', or 'Composite suppl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as he may deem fit, by public notification, specify to be an industrial township. (2) In this article, "a transitional area", "a smaller urban area" or "a larger urban area" means such area as the Governor may, having regard to the population of the area, the density of the population therein, the revenue generated for local administration, the percentage of employment in non agricultural activities, the economic importance or such other factors as he may deem fit, specify by public notification for the purposes of this Part. 9.9 By virtue of Government Notification No. HUD 474 MLR 95, dated 10.10.1995, Tumkur was specified as "City Municipal Council Area", and vide Notification No. UDD 154 MLR 2013, Bangalore, Dated 20.12.2013, Tumkur was specified as a "Larger Urban Area" and Tumkur Corporation was established. Accordingly, we find that the city of Tumkur, (now Tumakuru) was already a Municipality which later attained the status as a Municipal Corporation. Tumakuru has also been identified as one among the 100 cities in India to be covered under the 'Smart Cities Mission' launched by the Government of India. Therefore, the Tumakuru City Corporation qualifies as a "Loc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 28.07.2017, as amended. 9.13 The third query raised by the applicant is "Whether the service recipient i.e., M/s. Tumkur Smart city Corporation is a "Governmental Authority" as per the definition of Notification No. 12/2017 CT dated 28.06.2017?". We find that under this query, the applicant has sought a clarification on M/s. Tumkur Smart City Limited, which has been referred to as M/s. Tumkur Smart city Corporation, by the applicant, probably due to inadvertence. In this regard, we are of the opinion that this query which lacks clarity need not be answered, especially in view of the fact that M/s. Tumkur Smart City Limited is neither the service provider, nor the service receiver in the instant case, and that the same is only a special purpose vehicle to facilitate the Parties (the applicant, and M/s. Tumakuru City Corporation) for seamless execution of the project, as discussed in detail in para 8.8 above. Therefore, any query in relation to the said entity/body docs not merit consideration, and accordingly, this query docs not get covered under any of the clauses from (a) to (g) of Section 97(2) of the CGST/TNGST Act, 2017, for which an advance ruling can be sought. 10. In view ..... X X X X Extracts X X X X X X X X Extracts X X X X
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