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TMI Blog2025 (3) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... de to construction of the same words or expressions in another statute unless the same are pari materia legislations or specifically provided or incorporated in the other statute - The impugned order insofar as it looks to the definition of Railways as defined under the Indian Railways Act, to construe the scope and width of the notification is wholly misdirected. Applying the definition of Railways under Indian Railways Act, 1989 - HELD THAT:- On applying the definition of Railway as defined under IRA it appears that the contract between the petitioner and RVNL for doubling of track between Vanchi Maniyachchi to Nagercoil, construction of roadbed, minor bridges, platforms, buildings, water and effluent treatment facilities, wagon / coaching maintenance infrastructure, supply of ballast, installation of tracks and other electrical, signalling and telecommunication infrastructure in Madurai and Thiruvananthapuram Divisions of Southern Railway, would constitute 'Railway' even under the definition of Indian Railways Act, more particularly covered under clauses (b), (c) and (d) to Section 2(31) of the Indian Railways Act. Expression "Railway" under the Notification - Not conf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t notification and thus covered under Sl.No. 3 (v) (a) of the said notification. Construction that leads to Consistency - HELD THAT:- It is trite law that consistency in law is as important as correctness, if not greater as held in Paper Products LTO vs. Commissioner of Central Excise [1999 (8) TMI 70 - SUPREME COURT] - Thus the impugned order being contrary to Appellate Advance Ruling and Advance Ruling Authorities referred above would lead to uncertainity and inconsistency which ought to be avoided. Conclusion - The contract for doubling of track between Vanchi Maniyachchi to Nagercoil, construction of roadbed, minor bridges, platforms, buildings, water and effluent treatment facilities, wagon / coaching maintenance infrastructure, supply of ballast, installation of tracks and other electrical, signalling and telecommunication infrastructure in Madurai and Thiruvananthapuram Divisions of Southern Railway, between the petitioner and RVNL would be covered by Notification 11 of 2017 CGST (RATE) dated 28.06.2017 as amended vide Notification No. 20/2017 dated 22.08.2017, Notification No. 8 of 2017 Integrated Tax (Rate) dated 28.06.2017 and G.O. Ms. No. 94 dated 22.8.2017 CT & RE and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owing entries during the impugned period viz., 2018-19 to 2022-23. During the period 2018-19, the relevant entries under Notification 11 of 2017 CGST (RATE) dated 28.06.2017 as amended vide Notification No.20/2017 dated 22.08.2017 and Notification No.8 of 2017 Integrated Tax (Rate) dated 28.06.2017 and G.O. Ms. No. 94 dated 22.8.2017 CT &RE are identically worded and hence collectively referred to as "subject notifications" read as under: Sl. No. Chapter, Section of Heading Description of Service Rate (percent.) Condition (1) (2) (3) (4) (5) 1 Chapter 99 All Services 2 Section 5 Construction Services 3 Heading 9954 (Construction Services) (...) (v) Composite supply of works contract as defined in clause (119) of Section 2 of the Central Goods and Services Tax Act, 2017, supplied by way of construction, erection, commissioning, or installation of original works pertaining to,- (a) railways, including monorail and metro; (...) (6) - 2.4. The above entry was amended vide Notification 3 of 2019 whereby the highlighted portions were inserted w.e.f. 01.04.2019: Sl.No. Chapter, Section of Heading Description of Service Rate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... differential GST of 6%, on services provided by the petitioner to RVNL for the reasons set out in Form GST-DRC-01A. 4. In response to the above notice in Form GST-DRC-01, the petitioner submitted its reply on 01.03.2023, wherein, it was inter-alia submitted that the contract between the petitioner and RVNL, is entitled to the concessional rate as the same is covered by Sl No. 3 (v) (a) of the subject notifications it stood during the relevant period inter alia for the following reasons: a) Services supplied by the petitioner constitute works contract services of construction, erection, commissioning, or installation; b) That the works contract services are original works, and c) That the works contract services "pertain to railways"; d) That the petitioner had paid GST at the rate of 12% on the subject supplies in terms of Sl.No. 3 (v) (a) of the Rate Notifications. 4.1. With regard to the issue of maintenance of Input Tax Credit register, it was submitted that the same was maintained electronically but could not be furnished at the time of inspection, since the concerned person was unable to extract the same through SAP software due to technical issues. However, it has s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sted on the stock exchange; iv. Employees working in RVNL are not considered as employees; and v. RVNL undertakes corporate social responsibility initiatives. 8. Heard the learned counsels on both sides and perused the materials on record. 9. Against the above background, question arises as to whether the petitioner's contract with M/s. RVNL is entitled to the concession granted in terms of Sl. No. 3 (v) (a) of the notification, in other words liable to tax at 12%. 10. Before proceeding to examine the issue, it may be relevant to keep in mind that the following aspects are not in dispute, viz., a) Services supplied by the petitioner constitute works contract services of construction, erection, commissioning, or installation; b) That the works contract services are of original works, and c) That the works contract services pertain to railways; d) That the petitioner has paid 12% GST on all these services in terms of Sl.No. 3 (v) (a) of the relevant Notifications. 11. RELEVANT NOTIFICATION: 11.1. Before proceeding further, it may be necessary to extract the relevant portion of the subject notification, which falls for consideration and the same reads as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 989: 13.1. With this background in view, we shall now proceed to examine the contention of the Respondent, premised on the definition of 'Railway' under the Indian Railways Act, 1989 (hereinafter referred to as 'IRA') 13.2. It may be relevant to note that "Railways", has not been defined under the GST Act. Thus, the expression "railway" employed in the above notification, ought to be understood applying the common parlance test. It is also relevant to keep in view that a definition contained in a particular enactment cannot be incorporated into another enactment unless the enactments are pari materia. The definition in one statute may not afford a guide to construction of the same words or expressions in another statute unless the same are pari materia legislations or specifically provided or incorporated in the other statute. It may be relevant to note that there are several definitions under the GST Act, wherein, the definitions under other enactments have been referred to/incorporated, some of them being, "(23) ―'chartered accountant' means a chartered accountant as defined in clause (b) of sub-section (1) of section 2 of the Chartered Accountan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arise. This is a plain and simple meaning flowing from the definition of the words "paying guest" under the Act. Introducing any other element or ingredient to give meaning to the words "paying guest" as may be prevalent under any other law or under English law will be doing violence to the definition of the words "paying guest" as defined under the Act." (emphasis supplied) c) Tata Consultancy Services v. State of A.P., (2005) 1 SCC 308: "40. The Copyright Act and the Sales Tax Act are also not statutes in pari materia and as such the definition contained in the former should not be applied in the latter. 41. In the absence of incorporation or reference, it is trite that it is not permissible to interpret a word in accordance with its definition in other statute and more so when the same is not dealing with any cognate subject." (emphasis supplied) 13.4. Thus the impugned order insofar as it looks to the definition of Railways as defined under the Indian Railways Act, to construe the scope and width of the notification is wholly misdirected. 14. Applying the definition of Railways under Indian Railways Act, 1989: Having found that the definition of railways under IR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture, supply of ballast, installation of tracks and other electrical, signalling and telecommunication infrastructure in Madurai and Thiruvananthapuram Divisions of Southern Railway, would constitute 'Railway' even under the definition of Indian Railways Act, more particularly covered under clauses (b), (c) and (d) to Section 2(31) of the Indian Railways Act. 15. Expression "Railway" under the Notification - Not confined to Indian Railway: 15.1. Importantly, if one reads the relevant entry to the notification it clear that the expression "Railway" is not employed with reference to viz., Indian Railway, as conceived by the respondent. The above assumption by the respondent in the impugned order overlooks the fact that the expression "Railway" employed in the said notification is with reference to an industry / utility rather than qualifying a specific entity viz., "Indian Railway". This would be even more evident from the fact that the notification is not confined to original work pertaining to railway, but also original work pertaining to mono rail and metro rail. Mono Rail and Metro Rail are primarily funded, operated and managed by private entities, as would be evident ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eeming provision, are used in the expansive sense, as per decisions of courts, meanings found in standard dictionaries, and the principles of broad and liberal interpretation in consonance with Article 39(b) and (c) of the Constitution." 16.2. The use of the expression "pertaining to" would show that the legislation intented to give an expansive meaning to the expression "Railway". If we bear this in mind the contract in question for doubling of track between Vanchi Maniyachchi to Nagercoil, construction of roadbed, minor bridges, platforms, buildings, water and effluent treatment facilities, wagon / coaching maintenance infrastructure, supply of ballast, installation of tracks and other electrical, signalling and telecommunication infrastructure in Madurai and Thiruvananthapuram Divisions of Southern Railway, between the petitioner and RVNL, would constitute original work pertaining to railway for the purpose of the subject notification. 17. Exemption not to be curtailed by importing conditions: 17.1. The expression "Railway" employed in the notification does not incorporate the definition under Indian Railway Act nor is it with reference to or limited in its operation to India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in favour of the assessee, importantly approved and reiterated the law laid down by the Supreme Court in the case of Hansraj Gordhandas, wherein it was held that if the taxpayer is within the plain terms of the exemption it cannot be denied its benefit by calling in aid any supposed intention of the exempting authority. The relevant portions of the judgment is extracted hereunder: "44. In Hansraj Gordhandas v. CCE [Hansraj Gordhandas v. CCE and Customs, AIR 1970 SC 755 : (1969) 2 SCR 253] [hereinafter referred to as "Hansraj Gordhandas case", for brevity], wherein this Court was called upon to interpret an exemption notification issued under the Central Excise Act. It would be relevant to understand the factual context which gave rise to the aforesaid case before the Court. The appellant was the sole proprietor who used to procure cotton from a cooperative society during the relevant period. The society had agreed to carry out the weaving work for the appellant on payment of fixed weaving charges at Re. 0.19 np. per yard which included expenses the society would have to incur in transporting the aforesaid cotton fabric. In the years 1959 and 1960, the Government issued an exempt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e meant, although there has been an omission to enact it. In a Court of Law or Equity, what the legislature intended to be done or not to be done can only be legitimately ascertained from that which it has chosen to enact, either in express words or by reasonable and necessary implication.' It is an application of this principle that a statutory notification may not be extended so as to meet a casus omissus. As appears in the judgment of the Privy Council in Crawford v. Spooner [Crawford v. Spooner, 1846 SCC OnLine PC 7 : (1846-50) 4 Moo IA 179]. '... we cannot aid the Legislature's defective phrasing of the Act, we cannot add, and mend, and, by construction, make up deficiencies which are left there.' The learned counsel for the respondents is possibly right in his submission that the object behind the two notifications is to encourage the actual manufacturers of handloom cloth to switch over to power looms by constituting themselves in cooperative societies. But the operation of the notifications has to be judged not by the object which the rule-making authority had in mind but by the words which it has employed to effectuate the legislative intent." 17.3. As stated su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndle coal and oil fuel traffic of RTPS Order 27WBAAR/2018-19 (Rites Limited) by West Bengal AAR (05/10/2018) Construction of a private railway siding for the carriage of coal and oil fuel to Raghunathapur TPS, as described in the agreement between the applicant and DVC, is a composite supply of works Contract, taxable at 12% under Serial No 3(v)a of Notification No. 11/2017-CT(Rate) dated 28.06.2017 Section 2 (31) (d) - works contract supplied by way of construction, erection, commissioning or installation of original works pertaining to railways Order No. MAH/AAAR/SS-RJ/15/2018-19 Shree Construction Maharashtra AAAR Order (03/01/2019) Thus, the condition specified under item (v) of SR 3 of the said notification is completely fulfilled and therefore the service provider by sub-contractor would attract a concessional rate of 12% GST Section 2 (31) (b), 2 (31) (d) - Works Contract by way of construction, erection, commission, installation, completion, fitting out, repair, maintenance, renovation or alteration of a structure including for educational, clinical or cultural establishment or a road bridge, tunnel, etc., STC/AAR/03/2020/41 Dee Vee Projects by Chhattisgarh (08.10 ..... 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