18% GST Applicable to Services for Municipal Wet Waste processing facility along with Operation & Maintenance to SUDA: AAR [Read Order]

The West Bengal Authority for Advance Rulings (AAR) has held that 18% GST is applicable for the supply to be provided to State Urban Development Agency for Municipal Wet Waste processing facility along with operation & maintenance under Swachh Bharat Mission/Mission Nirmal Bangla.

The appellant, Simoco Telecommunications (South Asia) Limited approached the Authority stating that the State Urban Development Authority has accepted their offer for design, build, finance, operate and transfer of Municipal Wet Waste processing facility based on Composting and/or Bio-methanation Technology, setting up Semi-Automatic Material Recovery Facility for Dry Waste and construction of Sanitary Land fill along with operation & maintenance for 10 years (Renewable) under Swachh Bharat Mission/Mission Nirmal Bangla and accordingly has issued “Letter of Acceptance cum Work Order” to him to carry out the said activities in respect of a number of municipalities in West Bengal.

A coram of Mr Brajesh Kumar Singh, Joint Commissioner, CGST & CX Mr Joyjit Banik, Senior Joint Commissioner, SGST observed that SUDA, being a registered society, is not a Panchayat or a Municipality or any Board or Cantonment as specified in the above-referred definition of local authority.

“Further, no documents have been produced before us wherefrom it can be established that SUDA is an authority who is legally entitled to and entrusted by the Government with the control or management of a local fund. Therefore, SUDA cannot be held as a local authority as defined in clause (69) of section 2 of the GST Act and the supply involved in the instant case thus fails to qualify for exemption vide serial number 3 or 3A of the Exempt Notification,” the AAR said.

“Supply of services to be provided by the applicant to State Urban Development Agency for design, build, finance, operate and transfer of Municipal Wet Waste processing facility based on Composting and/or Bio-methanation Technology, setting up Semi-Automatic Material Recovery Facility for Dry Waste and construction of Sanitary Landfill along with operation & maintenance under Swachh Bharat Mission/Mission Nirmal Bangla is classifiable under SAC 9994 as „sewage and waste collection, treatment and disposal and other environmental protection services‟ and is taxable @ 18%”,” the AAR added.

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates