Gujarat Appellate Authority for Advance Ruling (GAAAR) ruled that there is no GST exemption to the supplier of the manpower services to the Central, State or local government.
The bench determined that the workers provided by the appellant to various government departments for security, housekeeping, cleaning, data input operators, etc. is ineligible for an exemption under input No. 3 of Notification No. 12/2017-Central Tax (Rate), dated 28.06.2017 as amended.
The appellant, M/s. Sankalp Facilities and Management Services Pvt. Ltd., provides manpower supply services to several Government authorities.
The appellant has relied upon Entry No.3 to Notification No.12/2017-Central Tax (Rate) dated 28.06.2017 for claiming exemption on supply of manpower services provided to the Central Government, State Government, Local authorities, Governmental authorities and Government entities.
The authority observed that the words “or a Governmental authority or a Government Entity” in the heading Description of services against the referred Entry No.3 to Notification No.12/2017-Central Tax (Rate) has been omitted vide Notification No. l6/2021-Central Tax (Rate) dated 18.11.2021.
Further the bench of Samir Vakil and Vivek Ranjan observed that the appellant in their appeal has admitted that there is no entry exempting such services provided to Government offices.
The appellant made a mistake of assuming that entry No. 3 specifically exempts all services provided to government offices performing the duties listed in either article 243G or article 243W of the Indian Constitution.
The authority observed that the manpower services provided were not related to any activity in relation to any function carried out by these service recipients as entrusted under articles 243G or 243W of the Constitution of India.
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