The West Bengal Authority for Advance Rulings (AAR) has ruled that the supply of manpower for Mobile Veterinary Units (MVUs) on a contractual basis does not qualify as a veterinary clinic service and is therefore not eligible for GST exemption.
The applicant had entered into an agreement with the West Bengal Livestock Development Corporation Limited, a Government of West Bengal undertaking, to provide MVU personnel on a contractual basis across different units under the corporation. This agreement was executed following the acceptance of the applicant’s tender.
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The applicant sought an advance ruling under Section 97(1) of the GST Act to determine whether their supply of MVU personnel for the implementation of the “Establishment and Strengthening of Veterinary Hospitals & Dispensaries (ESVHD) – Mobile Veterinary Unit (MVU) under the Livestock Health & Disease Control (LH & DC) Scheme” was eligible for exemption under Notification No. 12/2017-Central Tax (Rate) dated 18.06.2017.
Upon examination, the AAR noted that the Livestock Health & Disease Control Scheme is a flagship program of the Government of India, with the respective state governments responsible for further implementation. The West Bengal Livestock Development Corporation Limited, under the Department of Animal Resources Development, was designated as the project-implementing agency. However, the AAR observed that the applicant was supplying MVU personnel on a contractual basis to the corporation rather than directly to the government.
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The AAR further stated that two separate supplies occurred in this case: one from the applicant to the West Bengal Livestock Development Corporation Limited and another from the corporation to the concerned government department. Since the applicant was not directly providing services to the government, the supply could not be considered an integrated provision of services by a government entity. Consequently, the applicant’s argument that the service qualified for exemption under Sl. No. 5 or 6 of Notification No. 12/2017-Central Tax (Rate) was rejected.
The advance ruling authority examined the eligibility for exemption under Sl. No. 3 of the notification, which requires the service to be a “pure service” provided directly to the government or a local authority and related to functions entrusted to a Panchayat or Municipality under Articles 243G or 243W of the Constitution.
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While the applicant’s services were related to animal husbandry, a function listed under Article 243G, the supply was made to the corporation, which is neither a government body nor a local authority. Thus, the preconditions for exemption under Sl. No. 3 were not met.
The bench of Dr Tanisha Dutta and Joyjit Banik clarified that a veterinary clinic typically refers to an establishment providing medical treatment and care for animals. Since the applicant was merely supplying manpower for MVUs and not operating a veterinary clinic, the service did not qualify for exemption under this category either.
Accordingly, it was ruled that the supply of MVU personnel on a contractual basis for the implementation of the ESVHD-MVU scheme is not eligible for exemption under Sl. No. 3, 3A, 5, 6, or 46 of Notification No. 12/2017-Central Tax (Rate) dated 18.06.2017. As a result, the service remains taxable under GST.
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