The West Bengal Authority for Advance Ruling (AAR) has recently ruled that “sewage and waste collection, treatment and disposal and other environmental protection services‟ are taxable at 18% Integrated Goods and Services Tax, IGST (9% CGST + 9% SGST).
The applicant submitted that the State Urban Development Authority (SUDA, for short) has accepted his 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 Landfill 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.
The applicant, Simoco Telecommunications (South Asia) Limited has made this application under sub-section (1) of Section 97 of the Goods and Services Tax Act, 2017 (GST Act) and the rules made there under raising following questions vide Serial Number 14 of the application in FORM GST ARA-01, seeking advance ruling on classification of the goods/services as per the work order and the applicable GST.
The revenue submitted that, the supply is classifiable as a composite supply attracting tax as applicable on Heading 9994, which is 9% CGST and 9% SGST as the applicant is probably going to make a supply of a composite service as in Section 2(30) of the CGST Act 2017.
Perusing the serial number 32 of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 and West Bengal State Notification No. 1135 F.T. dated 28.06.2017, it was observed by the authority bench of Brajesh Kumar Singh and Joyjit Banik that, the supply agreed to be provided by the applicant as it appears from the documents produced before us is in the nature of waste management services. We find that “waste collection services‟ and “waste treatment and disposal services‟ fall under SAC 9994 having Group 99942 and 99943 respectively. Further, sewage and waste collection, treatment and disposal and other environmental protection services‟ is taxable at 18% IGST.
It was thus ruled that, sewage and waste collection, treatment and disposal and other environmental protection services are taxable at 18% GST (9% CGST + 9% SGST).
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