Dismissed

M/s. Sankalp Facilities and Management Services Pvt. Ltd.

GST AAAR29 Mar 2023GUJ/GAAAR/APPEAL/2023/03

Case brief

AI extract

What is this about?

Cujarat Appellate Authority for Advance Ruling rejected the appellant's appeal against an earlier ruling. The court held that manpower services provided to government entities were not eligible for exemption under Entry No. 3 of Notification No. 12/2017 as the services were not in relation to functions entrusted to Panchayats or Municipalities.

What did the court decide?

The appeal filed by M/s Sankalp Facilities and Management Services Pvt. Ltd. against the Advance Ruling No. GUJ/GAAR/R/51/2021 was rejected.

M/s. Sankalp Facilities and Management Services Pvt. Ltd. — GST and Indirect Tax | GST AAAR (2023)

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CUJARAT APPELLATE AUTHORITY FOR ADVANCE RULING GOODS AND SERVICES TAX TYMARKFTt|fl'o*

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D/5, RAJYA KAR BHAVAN, ASHRAM ROAD, AHMEDABAD:380009

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ADVANCE RULING (APPEAL) NO. GUJiGfu{{R/APPEALI2O23 /03 (IN APPLICATION NO. Advance Ruling/SGST&CGST/2021 I AW24)

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oate'{.ol.zozl

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Nameandaddressofthe appellant	M/s.SankalpFacilitiesandManagementServices Pvt,[-td.- C-53,AmrapaliSociety. NearVrajdham, Manjalpur, Vadodara. Gujarar3900lI
GSTIN oftheappellant	24ABCCSSIOOMlZC
AdvanceRulingNo.and Date	GUJ/GAAR/zu5I12021DATED06.09.2I
Dateofappeal	08.10.2021
DateofPersonalHearing	06.01.2023
Presentfortheappellant	ShriMahavirGadhavi(Advocate)

¶7

At the outset we would like to make it clear that the provisions of the Central Goods and Services Tax Act, 2017 and Gujarat Goods and Services Tax Act. 2017 (hereinafter referred to as the 'CGST Act. 2017' and the 'GGST Act, 201 7') are in pari materia and have the same provisions in like rnatter and diff-er from each other only on a few specific provisions. Therefore, unless a mention is particularly made to such dissimilar provisions, a reference to the CGST Act.201'7 would also mean reference to the corresponding similar provisions in the GGST AcL2017 .

¶8

The present appeal has been filed under Section 100 of the CGST Act, 2017 and the GGST Act. 2017 by M/s Sankalp Facilities and Management Services Private Limited (hereinafter referred to as Appellant) against the Advance Ruling No. GUJ/GAAR/R/51 /2021 dated 06.09.202 1.

¶9

Brief facts ofthe case:

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3.1 M/s Sankalp Facilities and Management Services Pvt. Ltd.. C-53, Amrapali Society. Near Vraidham, Manjalpur. Vadodara Gujarat (hereinafter referred to as^'the appellant'), holding GSTIN: 24ABCCS8IOOMIZC is engaged in the business of providing manpower supply for housekeeping. cleaning. security. data entry operator etc.

¶11

3.2 The appellant submitted that it provides manpower supply services to sev Government authorities/ entities and that the appellant is eligible to claim ex benefit under Sr.No.3 of Notification No. l212017-Central Tax (Rate) dated 2 )

I11Onlr

Page l of 20

)

for pure services (supply of manpower, security service) provided to Central Govemment, State Government, Local authorities. Govemment entities as detailed. in their application, subject to the condition that the services provided to these entities mentioned are provided by way of any activity in relation to any function entrusted to a Panchayat under Article 243G of the Constitution of India or in relation to any function entrusted to a Municipality under Article 243W of the Constitution of India.

¶16

J.J The appellant sought advance ruling on the following question: " Whether the appellant is liable to pay GST on manpower services

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provided to the Central Government, State Goyernment, Local authorities, Governmental authorities and Government entities? "

¶18

The Gujarat Authority for Advance Ruling (hereinafter referred to as "GAAR") vide its order No. GUJ/GAANW5I12}?I dated 06.09.2021, gave the following ruling ro the above question.

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"1. The subject supply for the purpose of security, cleaning and housekeeping services provided to the cited schools are exempt from GST. 2. GST is liable to paid on subject supply provided to all cited Government Colleges providing education services of above higher secondary level. 3. GST is liable to be paid on subject supply provided to all cited Government ffices. 4. GST is lioble to be paid on subject supply provided to all cited Government hospita ls.^"

¶20

Being aggrieved with the above Ruling. the appellant has preferred the present appeal on the following grounds:

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(a) The gist of the exen.rption entry no. 3 of Notification No. l2 of 2017 can be summarized lbr taking the benefit of the said exemption as under: (i) Pure services are provided

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(ii) Service recipient is either Central Govemment or State Govemment or Local authority or Government entity; and

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(iii) Such services provided should be by way ofany activity in relation to any function entrusted to a Panchayat under Article 243G ofthe

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Page 2 of 20

Constitution of India or in relation to any function entrusted^{to a} Municipality under Article 243W of the Constitution of India.

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(b) The leamed authority has misconstrued the term 'in relation to' stated in the notification entry. The term^'in relation to' used in above exemption^is very much wide enough to cover every kind of services that resultsⁱⁿ performance of the functions as mentioned in 243W and 243G of the Constitution of India either directly or indirectly. Even the services provided for enabling the organisation to perform defined functions would also be covered as a reason ofusage of words^'in relation to'. In the^case of Doypack Systems P. Ltd., Vs. UOI as reported in⁽¹⁹⁸⁸⁾ 36 ELT 201^(S.C.) it was held that " the expression^'in relotion to'^(so also^'pertaining to') is a very broad expression which pre-supposes another subject matter. These are words of comprehensiveness which might both have a direct significance as well as an indirect significance depending on the context. It also held that the expression^'in relation lo' has been interpreted to the words of widest amplitude".

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(c) They rely on the order of Advance Ruling Authority in the case of A.B. Enterprise vide order GUJ/GAAR/R/2020118 wherein appellant is engaged in supplying manpower for security and housekeeping to the Central Government, State Government and Local authority. Though the order is conditional but the analysis of certain work order clearly suggests that if the service recipient i.e. Central Govemment , State Government, Local authority is involved in any functions as per Article 243G or 243W, then the pure services provided to them would be eligible for exemption from payment of tax. That the case of the appellant is squarely covered in the aforesaid ruling.

¶31

(d) The authority has erred irr examining services provided by the appellant to various Government schools. by examining the same within the limited scope of Entry No.66 of the said notification. The appellant had sought exemption under the provisions of Entry No.3 of the said notification. Entry No. 66 is not limited to services provided to Govemment educational institutions, rather it is applicable to services provided to all educational institutions, whether Government or Private. and hence there is restriction in making such exemption applicable only to institutions providing services up to higher secondary school or equivalent. However, there is no such proviso or limitation applicable to exemption sought under the prov tslo

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of Entry No.3 of the Notification. as the same is applicable to Only Government institutions. Article 243G of the Constitution of India and the Eleventh Schedule . to which the Entry No.3 relates, at serial number l7 of the E,leventh Schedule the words used are^'education, including primary and secondary', therefbre the same will cover education even beyond secondary education and shall include i.e. even College and Universities. The appellant has not sought exemption under Entry No. 66, as the appellant is entitled and falls within the exemption granted under Entry No.3 of the Notification as the Institutions are Government Institutions. Therefore the authority has erred in considering the case of the appellant as regards to services provided to Govemment education institutions under Entry No. 66 of the Notification.

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(e) The GAAR has erred in holding that the services provided by the appellant to the Govemment Colleges are not exempted, by wrongly applying Entry No. 66 of the Notillcation. The appellant had specifically sought exemption under Entry No.3 of the Notification, as all the three pre-requisite conditions for applicability of Entry No.3 exemption are met with by the appellant by providing pure services to the Govemment Colleges in relation to any function entrusted to a Municipality /Panchayat under Article 243 G and 243W of the Consitituion of India. Therefore such services are covered under the Exemption granted vide Entry No. 3 of the Notification.

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(0 The GAAR has erred in holding that the services provided by the appellant to Govemment Hospitals including Veterinary Hospitals are not exempted. The appellant had specifically sought exemption under Enty No. 3 of the Notification, as all the three pre-requisite conditions for applicability of Entry No. 3 of exemption are met with by the appellant by providing pure services to the Government Hospitals in relation to any function entrusted to a Municipality / Panchayat under Article 243G and 243 W of the Constitution of lndia. Hospitals are cornmunity assets and therefore even the cleaning, security etc services are even otherwise directly in relation to Serial No. 29 of the Eleventh Schedule i.e. maintenance of communitv assets.

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(g) The GAAR erred in holding that there is no notification exempting services provided tolin Government offices. While it is admitted that there is no Entry exempting such services provided to all Government offices, but Entry No.3 does specifically cover the case of Government offices

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carrying out the functions enumerated in the Eleventh and the Twelfth Schedule of the Constitution of India. Entry no. 3 of the notification is specifically exempting such services and services 'in relation to...'provided to various Govemment offices. They place reliance on the^judgement of Hon'ble Supreme Court of India in the case of T.N.Kalyana Mandapam Assn. Vs. UOI & Ors. reported in2004 5 SC 632.

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(h) In light of the above the appellant submitted that the exemption is not limited to functions mentioned in the Eleventh and Twelfth of the Constitution of lndia, but it extends to every kind of service that results in pertbrmance of such functions either directly or indirectly and includes even the services provided fbr enabling the organisation to perform defined functions.

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(i) The services provided by the appellant to the various State Govemment departments and Govemment authorities/ entities are therefore covered and eligible for exemption in light of the thct that they are in relation to functions entrusted to a Panchayat under Article 243G of the Constitution of India or in relation to any function entrusted to a Municipality under Article 243W of the Constitution of India.

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1. The appellant is therefore providing manpower supply services to several Govemment authorities/ entities which are eligible for exemption in view of the above. The authority be pleased to rule that the appellant is eligible to claim exemption benefit under Sr.No.3 of Notification No. l212017-CT (Rate) dated 28.06.2017 for pure services (supply of manpower, security service) provided to Central Govemment , State Government,^Local authorities. Govemmental authorities, Govemment entities as detailed above subject to the condition that the services^provided to these entities mentioned above are provided by way of any activity in relation to any function entrusted to a Panchayat under Article 243G of the Constitution of India or in relation to any function entrusted to a Municipality under Article 243W of the Constitution oflndia.

¶50

5.1 During the course of virtual personal hearing held on 06.01.2023.^{the authorized} representative for the appellant, Shri Mahavir Gadhavi^{(Advocate)reiteratedthe} submissions made in their appeal. Further also fumished additional written submissions vide which it was submitted as under:

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The 155 work orders issued by difl'erent oflices can be lurther streamlined offices:

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a) Ofllce of the Collector & District Magistrate. Valsad and Chhota Udepur: (Category : State Govemment).

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These offices perform various functions under Article 243G and 243W and the appellant provides various manpower services for the work of peon, driver, data entry operator etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibilities under Article 243G and 243W of the Constitution of India. GAAR had given exemption in similar case to A.B. Enterprise vide their order dated t9.05.2020.

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b) OfIce of the District Social Welfare Officr, Valsad and Chhota Udepur: (Category : State Government).

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These offices perform various flunctions under Article 243 G and 243 W specifically Entries no. 16, 24. 25, 26, 27, 28 of Article 243G and Entries No. 6 and I I of Article no. 243 W, and the appellant provides various manpower services fbr the work ofpeon, driver, data entry operator etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibilities under Article 243G and 243w of the Constitution of India.

¶59

Identical work order is determined to be exempted under Entry at Sr. no. 3 of the notitication no. 12/2017 in case of A.B. Enterprise by the Advance Ruling Authority vide order dated 19.05.2020

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c) District Panchayat, Valsad (including its subordinate offices): (Category: Local Authority)

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These offices perform all the f'unctions under Article 243 G and the appellant provides various manpower seryices for the work of peon, driver, data entry operator, security etc. to help in the fundamental works entrusted upon the concemed olfices in discharge of various responsibilities under Article 243G and 243W of the Constitution of India.

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ldentical work order is determined to be exempted under Entry at Sr. no.3 of the notification no. 12/2017 in case of A.B. Enterprise by the Advance

Page 6 of 20

Ruling Authority in Advance Ruling No. GUJ/GAAR/'R/2020118^videorder dated 19.05.2020.

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d) Water resource development department Damanganga & its offices: (Category: State Government)

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These offices perform various functions under Article 243 G^{and 243 W} specifically Entries no. 3 and 11 of Article 243G^and, Entries^{No. 5} of Article no. 243W. and the appellant^provides various manpower^services for the work of peon, driver. data entry operator etc. to^help in^the fundamental works entrusted upon the concemed offices^{in discharge of} various responsibilities under Article 243G and 243W of the^Constitution of India.

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Identical work order is determined to be exempted under Entry at Sr.^{no. 3} of the notification no. l212017 in case of A.B. Enterprise by the^Advance Ruling Authority in Advance Ruling No. GUJ/GAAR/22020118^{vide order} dated 19.05.2020.

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e) Office of the Vidhyut Nirikshak. Valsad:

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(Category: State Government)

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These offices perform various functions under Article 243 G specifically Entry no. l4 of Article 243G, and the appellant^provides various^manpower services for the work of peon, driver, data entry operator.^{security etc. to} help in the fundamental works entrusted upon the concerned officesⁱⁿ discharge of various responsibilities under Article 243G and 243W^{of the} Constitution of India.

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Identical work order is determined to be exempted under Entry^{at Sr. no. 3} ol the notification no. 12/2017 in case of A.B. Enterprise by^{the Advance} Ruling Authority in Advance Ruling No. GUJ/GAAR/R/2020118 vide order dated 19.05.2020.

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r) Water resource development department^(Chhota Udepur) & its offices: (Category : State Government)

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These offices perform various functions under Article 243 G and 243 W specifically Entries no. 3 and I I of Article 243G and Entries No. 5 Article no. 243W. and the appellant provides various manpow^er

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fbr the work of peon, driver, data entry operator etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibilities under Article 243G and 243W of the Constitution of India.

¶80

Identical work order is determined to be exempted under Entry at Sr. no. 3 of the notification no. 12/2017 in case of A.B. Enterprise by the Advance Ruling Authority in Advance Ruling No. GUJ/GAAR/R/2O2OIlB vide order dated 19.05.2020.

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-q) Oftice ofthe Deputy Conservator ofForest, Chhota Udepur: (Category: State Government)

¶82

These offices perform various functions under Article 243 G and 243 W specifically Entries no. 6,7 ,27 of Article 243G and Entries No. 8 of Article no. 243W. and the appellant provides various manpower services for the work ofpeon, driver, data entry operator etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibilities under Article 243C and,243W ofthe Constitution of lndia.

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h) Office of the District Rural Development Agency, Valsad: (Category: State Government)

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These offices perform various functions under Article 243 G specifically Entries no. 6, 9, 10, 11,16,25 of Article 243G, and the appellant provides various manpower services lbr the work ofpeon, driver, data entry operator etc. to help in the lundamental works entrusted upon the concemed offices in discharge of various responsibilities under Article 243G of the Constitution of India.

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Identical work order is determined to be exempted under Entry at Sr. no.3 of the notification no. 12/2017 in case of A.B. Enrerprise by the Advance

L
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Ruling Authority in Advance Ruling No. GUJ/GAAR/R/2020118^{vide order} dated 19.05.2020.

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i) Centre of Excellence for Floriculture^andMango:

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(Category : Government Authority)

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These offices perlorm various functions^{under Article243 G and 243 W} specifically Entries no.^I of Article^{243C and Entries No. 5 of Articleno'} 243W. and the appellant provides various^{manpower servicesfor the work} of peon. driver. data entry operator^{etc. to help in the fundamental works} entrusted upon the concerned offices in discharge^{ofvariousresponsibilities} under Article 243G and 243W of the Constitution^oflndia.

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Identical work order is determined^{to be exempted underEntry at Sr. no. 3} of the notification no. 1212017 in^{caseof A.B.Enterpriseby the Advance} Ruling Authority in Advance Ruling^{No. GUJ/GAAR/R/2020/18 vide order} dated 19.05.2020.

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Office of the Deputy Director - Agriculture,^{(Valsad& Chhota Udepur) &}

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i) its offices:

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(Category: State Government)

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These offices perform various^{functionsunderArlicle 243 G and 243 W} specifically Entries no. I and^{29 of Article243Gand EntriesNo. 8 and 17} of Article no. 243W, and the appellant^{providesvarious manpowerservices} for the work of peon, driver,^{dataentry operator etc. to help in the} fundamental works entrusted^{uponthe concemed offices in discharge of} various responsibilities under^{Article 243Gand243W of the Constitution} of India.

¶99

Identical work order is determined^{to be exempted under Entry at Sr' no.3} of the notification no. l2l20l7 in^{case of A.B. Enterpriseby the Advance} Ruling Authority in Advance Ruling^{No. GUJ/GAAR/R/2020118vide order} dated 19.05.2020.

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k) Govemment General Hospital.^{Chhota Udepur:}

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(Category : State Covernment)

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These offices perfbrm various functions under Article 243 G and 243 W specifically Entries no.23 of Article 243G and Entries No.6 of Article no. 243W, and the appellant provides various manpower seryices fbr the work of peon, driver, housekeeping, security etc. to help in the fundamental works entrusted upon the concerned offices in discharge of various responsibilities undsr Article 243G and 243w of the constitution of India.

¶106

Identical work order is determined to be exempted under Entry at Sr. no.3 of the notillcation no. l2l20l7 in case of A.B. Enterprise by the Advance Ruling Authority in Advance Ruling No. GUJ/GAARiR/2O20/l g vide order dated 19.05.2020.

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l) Office of the District Education officer, (Valsad & Chhota Udepur). (Category: State Govemment)

¶108

These offices perfonn various functions under Articre 243 G and 243 w specifically Entries no. 17 and 25 of Articre 243G and Entries No. 13 of Article no. 243 w, and the appelrant provides various manpower services tbr the work ol peon. driver, data entry operator etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibilities under Article 243G and 243w of the constitution of India.

¶109

Identical work order is determined to be exempted under Entry at Sr. no. 3 of the notification no. r2/20r7 in case of A.B. Enterprise by the Advance Ruling Authority in Advance Ruling No. GUJ/GAAR/R/2o20llg vide order dated 19.05.2020.

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m) Office of the Prayojana vahivatdar, Valsad & Chhota Udepur: (Category: State Government)

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These offices perform various functions under Article 243 c specifically Entries no. 16, I 7 and 27 of Article 243G, and the appellant provides various manpower services for the work ofpeon, driver, data entry operator etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibilities under Article 243G of the Constitution of India.

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¶114

Identical work order is determined to be exempted under Entry at Sr. no. 3 of the notification no. l2l20l7 in case of A.B. Enterprise by the Advance Ruling Authority in Advance Ruling No. GUJ/GAAR/R/2020118 vide order dated 19.05.2020.

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n) Office of the Matsya Udhyog Adhikshak:

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(Category: State Government)

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These offices perform various functions under Article 243 G specifically Entries no. 5, 7, and 8 of Article 243G, and the appellant^{provides various} manpower services for the work of peon, driver, data entry operator etc.^to help in the fundamental works entrusted upon the concemed^{offices in} discharge of various responsibilities under Article^{243Gof the Constitution} of India.

¶118

Identical work order is determined to be exempted under^{Entry at Sr. no' 3} of the notiflcation no. l2l20l7 in case of A.B.^{Enterpriseby the Advance} Ruling Authority in Advance Ruling No.^{GUJ/GAAR/R/2020/18 vide order} dated 19.05.2020.

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o) Agricultural Technology Management Agency:

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(Category : Government Authority)

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These offices perform various functions under^{Arlicle 243 G specifically} Entries no. 1,7, 27 of Article 243G. and the^{appellantprovides various} manpower services for the work of^peon. driver,^{dataentry operatoretc. to} help in the fundamental works entrusted upon^{the concerned offices in} discharge ofvarious responsibilities under^{Article243Gof the Constitution} of India.

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p) Office of the Deputy Director of Animal Husbandry^Valsad: (Category : State Government)

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These offices perform various functions under^{Article 243 G specifically} Entries no. 4 of Article 243G, and the appellant^{providesvarious manpower} services for the work ofpeon, driver, data entry operator,^{sweeper' security} etc. to help in the fundamental^works entrusted^{upon the concemedoffices} in discharge of various responsibilities under Article 243G ol the Constitution of India. r'l/--

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ldentical work order is determined to be exempted under Entry at Sr. no. 3 of the notification no. 1212017 in case of A.B. Enterprise by the Advance Ruling Authority in Advance Ruling No. GUJ/GAAR/R/2020/18 vide order dated 19.05.2020.

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q) District Udhyog Centre. Valsad: (Category : State Government)

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These oftices perform various functions under Article 243 G specifically Entries no. 8 & 9 of Article 243G, and the appellant provides various manpower services for the work of peon. driver, data entry operator, security, housekeeping etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibilities under Article 243G of the Constitution of India.

¶131

Identical work order is determined to be exempted under Entry at Sr. no. 3 of the notificationno. 12/2017 in case of A.B. Enterprise by the Advance Ruling Authority in Advance Ruling No. GUJ/GAAR/R/2020118 vide order dated 19.05.2020.

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r) Gujarat Landless Labour & Agriculturalist Housing Board: (Category : Covernment Authority)

¶133

These offices perform various functions under Article 243 G specifically Entries no. 10, 16, 26, 27 of Article 243G, and the appellant provides various manpower services for the work ofpeon, driver, data entry operator etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibilities under Article 243G of the Constitution of India.

¶134

Identical rvork order is determined to be exempted under Entry at Sr. no. 3 of the notiflcation no. 12/2017 in case of A.B. Enterprise by the Advance Ruling Authority in Advance Ruling No. GUJ/CAAR/R/2020/lB vide order dated 19.05.2020.

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s) District Institute of Training & Education, Valsad:

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(Category : Government Authority)

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These offices perform various functions under Article 243 G and 243 W specifically Entries no. l8 & 19 of Article 243G and Entries No.9 & 13 of Article no. 243W, and the appellant provides various manpower services for the work of peon, driver, data entry operator etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibilities under Article 243G and 243W of the Constitution of India.

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l) GIRLS LITERACY RESIDENTIAL SCHOOL, KARCHOND (GSTES): (Category: Govemment Authority)

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These offices perform various functions under Article 243 G and 243 W specifically Entries no. 17 & 27 of Article 243G and Entries No. 9 & I 3 of Article no. 243W, and the appellant provides various manpower services for the work of peon. driver, data entry operator etc. to help in the fundarnental works entrusted upon the concerned offices in discharge of various responsibilities under Article 243G and 243W of the Constitution of India.

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u) Govemment Science College, Pardi (Valsad):

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(Category: Government Authority)

¶147

These offices perform various functions under Article 243 G and 243 W specifically Entries no. 17, 18 & 19 of Article 243G and Entries No.13 of Article no. 243W. and the appellant provides various manpower seryices for the work of peon, driver, data entry operator etc. to help in the fundamental works entrusted upon the concerned offices in discharge of

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various responsibilities under Article 243G and 243W of the Constitution of India.

¶152

Identical work order is determined to be exempted under Entry at Sr. no. 3 of the notitlcation no. 1212017 in case of A.B. Enterprise by the Advance Ruling Authority in Advance Ruling No. CUJ/GAAR/R/2020/18 vide order dated 19.05.2020.

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v) Shri C.H. Bhil Govt. Arts & Commerce College, Naswadi: (Category: Govemment Authority)

¶154

These offices perform various functions under Article 243 G and 243 W specifically Entries no. 17,18 & 19 of Article 243G and Entries No.13 of Article no. 243W. and the appellant provides various manpower services for the work of peon, driver, data entry operator etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibitities under Article 243G and 243W of the Constitution of lndia.

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Office of the Assistant Director of Libraries:

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(Category: Govemment Authority)

¶159

These offices perform various functions under Article 243 G and 243 W specifically Entries no. 20 of Article 243G and Entries No.l2, 13. and l7 of Article no. 243W. and the appellant provides various manpower services for the work of peon, driver, data entry operator etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibilities under Article 243G and 243W of the Constitution of India.

¶160

Identical work order is determined to be exempted under Entry at Sr. no. 3 of the notification no. l2l20l7 in case of A.B. Enterprise by the Advance

Page 14 of 20

Ruling Authority in Advance Ruling No. GUJ/GAAR/'R/2020/18 vide order dated 19.05.2020.

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x) Model School. Naswadi:

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(Category: State Government)

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No submissions as exemption already granted by the advance ruling authority.

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v) National Highway Authority of India:

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(Category: Government Authority)

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These offices perfonn various functions under Article 243 G specifically Entries no. 13 of Article 243G. and the appellant provides various manpower services for the work of peon, driver, data entry operator. security etc. to help in the fundamental works entrusted upon the concemed offices in discharge of various responsibil ities under Article 243G of the Constitution of India.

¶171

Identical work order is determined to be exempted under Entry at Sr. no. 3 of the notification no. 1212017 in case of A.B. Enterprise by the Advance Ruling Authority in Advance Ruling No. GUJ/GAAzuR/2020118 vide order dated 19.05.2020.

¶172

5.2 In pursuance to transfer of Member (SGST), the appellant was informed regarding the same for fresh personal hearing in the matter. The appellant vide his letter/mail dated 14.03.2023 requested to decide the appeal on the basis of material submitted physically as well as on mail and material alreadv on record.

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Discussions & Findings:

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We have gone through the f'acts of the case as submitted in the Appeal papers. the Ruling of the GAAR, documents on record and oral as well as all the written submissions made by the appellant.

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7.1 We find that the appellant is engaged in the business of providing manpower supply fbr housekeeping. cleaning. security. data entry operator etc. The appellant has sought ruling on the fbllowing:

ilri9ilt

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" Whether the appellant is liable to pay GST on man power services provided to the Central Goyernment, State Government, Local authorities, Governmental authorities and Government entities?^"

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7.2 The appellant has relied upon Entry No.3 to Notification No.l212017-Central Tax (Rate) dated 28.06.2017 lbr claiming exemption on supply of manpower services provided to the Central Govemment, State Govemment, Local authorities, Governmental authorities and Government entities. The extracts of the said entry No. 3 to Notification No.l2l2Ol7-Central Tax (Rate) dated 28.06.2017 as amended, relied upon by the

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appellant for claiming exemption is reproduced below:

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SI No	Chapter, Section, Heading, Groupor Service Code (Tariff)	OescriptionofServaces	Rale (per cent.)	Condation
(1)	(2)	(3)	(4)	(5)
3	Chapter99	Pureservices (excludingworks conlractserviceorother compositesuppliesinvolvingsupplyofany^goods) provided to theCentralGovernment, State Government or Union territoryorlocalauthoratyby wayofanyactivityin relationtoanyfunction entrustedtoaPanchayatunder article 243GoftheConstitutionorinrelationtoany function entrustedtoaMunicipality under article 243W of the Constitution.	Nit	Nit

¶184

7.3 The following three conditions need to be fulfilled for availing exemption under the above referred entry:

¶185

i) There should be supply ofpure services; ii) The recipient of services should be Central Government. State Govemment or Union territory or local authority;

¶186

iii) The services provided should 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.

¶187

7.4 We find that the words "or a Govemmental authority or a Govemment Entity'r in the heading Description of services against above referred Entry No.3 has been omitted vide Notification No. l612021-Central Tax (Rate) dated l8.l 1.2021.

l-cisr

Page 16 of 20

7.5 We find that GAAR in their findings stated that they have examined 155 contracts/ work orders presented by the appellant before the advance ruling authority. They categorized the service recipients into broadly four categories as under:

¶193

i) Govemment Schools ii) Govemment Colleges iii) Govemment Offices iv) Government Hospitals

¶194

The CAAR extended the benefit of exemption to Govemment Schools not under Entry Sl.No.3 but under Entry Sl. No. 66 to Notification No. l212017-CT (Rate) dated 28.06.2017 as amended. They denied the benefit of exemption to Government Colleges under the said Entry Sl. No.66 and denied the beneflt of exemption to Government Hospitals under Entry Sl. No. 46 and 74 of notification ibid. They further denied the benefit of exemption to Government offices under Entry Sl. No. 3 of Notification No. l2l20l7 -CT (rate) dated 2E.06.20 l7 .

¶195

7.6 The GAAR, on examination of all the contracts of the appellant, has not given any adverse findings with regard to supply of pure services and the recipient of services as required under Entry No.3 of Notification No. l212017-CT (Rate) dared 28.06.2017 as amended. They have examined the requirement of condition mentioned at Sr.(iii) of para 7.3 above and denied the benefit of exemption notification to the appellant on nonfulfillment of the said condition only.

¶196

7 .7 The main contention of the appellant is that their supply of manporver services against 155 work orders are eligible for exemption under Entry No.3 of Notification No.l212017-CT (Rate) dated 28.06.2017 as amended.

¶197

The GAAR has given the benefit of exemption to manpower supply by the appellant to the recipient of service viz. Girls Literacy Residential School, Karchond (GSTES) & Model School, Naswadi. The benefit of exemption was given under Entry No. 66(b) to Notification No.l212017-CT (Rate) dated 28.06.2017. The exrracr of same is as follows:

¶198

SI	Chapter,	Rate
	Section,	(per cent.)
No	Heading,
	Groupor Service

5l ^Fr^G

Page 17 of 20

	Code (TarifO
(1)	(2)	(3)	(4)	(5)
66	Heading 9992or Heading 9963	Services^provided- (a)byan educationalinstitutiontoits students,facultyand staff; (aa) byaneducational institutionby wayofconductof entrance examination againstconsaderationin the form of entrancefee, (b)toaneducationalinstitution,byway of,- (i)transportationof students, faculty andstaff; (ii)catering,includinganymid-daymealsscheme sponsored by the Central Government, State Government orUnion territoryl (iii)securityorcleaningorhouse-keepingservices performedinsuch educational institution; (iv)services relatingtoadmissionto, examinationby, such institution; orconductof (v) supply of online educational^journalsorperiodicals: Providedthatnothingcontainedinsub-items^{(i), (ii)}and⁽ⁱⁱⁱ⁾ ofitem(b)shallapplytoaneducational^{institution other} thananinstatution^providingservicesby^{wayofpre-school} education and educationuptohighersecondary school^or equivalent. Provided furtherthatnothing containedinsub-item^(v)of item(b)shall applytoaninstitution^providingservices^by wayof,- (i)pre-school educationandeducationuptohigher secondaryschool or equivalent:or (ii)educationasapartofanapprovedvocational education course.	Nit	Nit

¶203

With regard to other service recipients the contention of the appellant,^{for claiming} benefit of exemption, is that the term^'in relation to' used^{in the exemption provided at} Entry No.3 of Notification No. l2l2017-CT^(Rate) dated^{28.06.2017, as amended,is} very much wide enough to cover every kind of services that^{results in pertbrmanceof the} functions as mentioned in Article 243W and 243G of the Constitution^{of Indiaeither} directly or indirectly. Therefore their supply of^{manpower services ior housekeeping.} cleaning. security, data entry operator etc. to the ret-erred^{service recipients are eligible} for exemption under the above said entry.

c05

Page 18 of 20

7.7.1 We do not find any basis in the above contention of the appellant. Firstly if the intention of the legislature was to exempt all the services provided to Central Government, State Government or Union Territory or Local authority then there^wasno need to speci$ 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. Even though the appellant^{is providingservices to the} Govemment offices concerned, but they are in no way related to the function^entrustedto a Panchayat under article 243G of the Constitution or lunction entrusted to^a Municipality under article 243 W of the Constitution. rvhich is carried out by the Government concerned.

¶209

7.8 The appellant in their appeal has admitted that there is no Entry exempting such services provided to Govemment offices. The appellant is however mistaken to assume that the Entry No.3 specifically exempts all the services provided to Govemment offices carrying out the functions enumerated under article 243G of the Constitution or article 243W of the Constitution. The manpower services provided by the appellant like housekeeping, cleaning, security, data entry operators etc are consumed within the premises of concemed Govemment offices enumerated above. These services were not related to any activity in relation to any function carried out by these service recipients^as entrusted under article 243G or 243W ofthe Constitution of India.

¶210

7.9 The^judgments relied upon by the appellant are not relevant as the same^are delivered in dilierent facts of the case. Further in the case of M/s. A. B. Enterprise,^relied upon by the appellant. the GAAR held that the exemption is subject to the condition that the services provided are services provided by way of any activity in relation to any function entrusted to a Panchayat under Article 243G of the Constitution of^{India or in} relation to any function entrusted to a Municipality under Article 243W of the Constitution of India. The aforesaid order is not relevant as in the^{present caseit is bcing} held that the services in question are not related to any activity in relation to any function carried out by the service recipients as entrusted under article 243G or 243W of the Constitution of lndia. Further we are of the view that as per Section 103 of the CGST Act, any Advance Ruling is binding only on the appellant who has sought it and^{on the} concemed officer or the^{jurisdictional} officer in respect ofthe appellant.

r^Ur toR/

PaBe 19 of 20

In view of the foregoing we find that the manpower supply by the appellant for housekeeping, cleaning. security, data entry operators etc. to various Govemment departments. mentioned in their application. is not eligible lbr exemption against Entry No. 3 to Notification No. l212017-Central Tax (Rate) dated 28.06.2017 as amended.

¶215

In view ofthe above findings. we reject the appeal filed by appellant M/s Sankalp Facilities and Management Services Pvt. Ltd., against Advance Ruling No. GUJ/GAAR/R/S1/2021 dated 06.09.2021 of the Gujarat Authority for Advance Ruling.

¶216

l- /L -a ( samlr Vakil ) Member (SGST)

¶217

Place: Ahmedabad Date: ofi .8.2023

¶218

tff
ST

¶219

(Vivek an) Member (CGST)

¶220

Page 20 of 20

M/s. Sankalp Facilities and Management Services Pvt. Ltd.

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