TN AAR: 18% GST Rate Applies on Civil Construction Delivered to Madras IIT

An 18% GST would be levied on the civil contracts provided by the petitioner to the Indian Institute of Technology, Madras, Tamil Nadu Authority for Advance Ruling (AAR) held.

The applicant Esvee Constructions is a contractor who has been granted a contract by IIT Madras for the ‘addition and alteration of D1 type quarters 45 units at Indian Institute of Madras’ for an amount of Rs.4,55,48,650 inclusive of GST rate at 12% and other applicable taxes, duties, and levies.

The petitioner’s customer Indian Institute of Technology, Madras claimed that the GST rate is 12% for Civil Contract Services with effect from 01.01.2022 post revision to Notification No.11/2017 C.T.(Rate) vide Notification No.15/2021 C.T.(Rate) dated 18.11.2021.

The bench acknowledged the applicant’s statements in the advance ruling application, as well as additional submissions made at the time of the personal hearings and comments provided by the State Tax Authorities.

The petitioner would have furnished the advance ruling application to reveal the liability for paying the tax on any goods or services or both with regard to the civil contract services functioned to their customer IIT Madras, under the term counted under Section 97(2)(e) of Goods and Services Tax Act, 2017.

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The panel of N. Usha and R. Gopalasamy observed that Section 3 (j) (iii) of The Institutes of Technology Act, 1961 that IIT, Madras is a ‘Society’ registered under the Societies Registration Act, 1860, consulted with the status of the body corporate via section 4(1) of the stated act for the advertising the science, education, diffusion of useful knowledge, etc beneath the regulation of the central government.

But post omission of ‘Government Entity’ from the service description under the vide Notification No.15/2021 C.T (Rate) on 18.11.2021 read with Notification No.22/2021 Cente Tax (Rate) dated 31.12.2021 with effect from 01.01.2022, the services of the petitioner would be counted under serial number 3 (xii) of Notification No. 11/2017 C.T (Rate) on 28.06.2017 and attract CGST of 9%.