AAR: CGHB Services Not Eligible to Get Benefit of Nil GST Rate

Chhattisgarh Housing Board services were recently ruled ineligible for Goods and Service Tax at a zero rate, Chhattisgarh Authority for Advance Ruling (AAR) stated.

Call Me Services, the applicant, offers auxiliary services for businesses as well as contract staffing, security guards, and manpower supplies. The applicant has been given a contract by the Chhattisgarh Housing Board (CGHB) to provide services related to the upkeep of several colonies that the CGHB created but did not hand over to the local authorities for upkeep.

The applicant has requested an advance ruling on whether the applicant’s service in regard to the upkeep of different colonies built by CGHB but not handed over to the local government is GST-free.

Alok Chopra, the applicant’s authorized agent, claims that the Chhattisgarh Housing Board falls under Indian Constitution’s Article 243W and twelfth schedule service in connection to a municipal duty and is exempt under Central Tax Notification No 12/2017.

The court found that the issue addressed in the application was clearly covered by section 97(2)(b) of the Central Goods and Services Tax Act of 2017.

The jurisdictional assistant commissioner of state tax, the petitioner who provides the supply would be counted under SAC 9985 and it draws an 18% GST rate.

The service listed in the application submitted by the applicant would not be included in the exemption category as specified in notice no. 12/2017, hence CGHB would not come under the state/central government local/state authority, according to the deputy commissioner CGST.

When debating the matter, the authority noted that the Chhattisgarh Housing Board did not qualify as a municipal or government entity. Moreover, the municipalities, panchayats, and other local authorities were named in Section 2(69) of the Central Goods and Service Tax Act of 2017.

According to Indian Constitutional Articles 243G and 243W, which delegated the role to municipalities, panchayats, and other local authorities, the provision of security guards from the tender document could not be regarded as duties delegated to a panchayat or municipality.

The member of authority Sonal Misra and Abinav Agarval determined that the service provided by the application in relation to the maintenance of various colonies developed by the Chhattisgarh Housing Board and not given over to the local authority by CGHB are not eligible for the benefit of nil rates GST after taking into account the submissions made by the petitioner and central and state jurisdictional authorities.