The Kerala Authority for Advance Ruling (AAR), ruled that Works Contract Services for construction provided to Malabar Cancer Centre attracts 18% GST.
M/s. Uralungal Labour Contract Co-operative Society Ltd (ULCCS), the applicant is registered under the Kerala Co-operative Societies Act, 1969. The applicant is primarily engaged in the construction of roads, bridges and other public infrastructure for the Government and other institutions and is an accredited agency for the Government of Kerala.
The applicant submitted that they have entered into an agreement with the Director, Malabar Cancer Centre (MCC), Kannur established as a charitable society registered under the Societies Registration Act for the construction and extension of site and building. MCC is an autonomous institution under Health and Family Welfare Department, Government of Kerala, started with an aim to establish a comprehensive cancer centre, providing the much-required oncology care to the general public. Patients are categorized according to their economic status, and accordingly it is expected that 20% of patients will be provided free services and about 60% on concessional rates.
The Division Bench consisting of Dr S.L. Sreeparvathy, IRS and Shy Abraham Renn S, IRS held that “We conclude that the services rendered by the applicant to Malabar Cancer Centre as detailed in the application are eligible for the concessional rate of tax of 12% prescribed in the entry at SI No. 3(vi) of Notification No. 11/2017 Central Tax (Rate) as Malabar Cancer Centre is a governmental authority as per definition of governmental authority.”
“However, consequent to the issue of Notification No. 22/2021 Central Tax (Rate) dated 31.12.2021 amending the entry at SI No. 3 (vi) of the Notification No. 11/2017 Central Tax (Rate) dated 28.06.2017 with effect from 01.01.2022 the concessional rate in terms of the said entry at SI No. 3 (vi) shall be applicable only till 31.12.2021 and thereafter from 01.01.2022, the applicant shall be liable to pay GST at the rate of 18% as per entry at SI No. 3 (xii) of the Notification No. 11/2017 Central Tax (Rate) dated 28.06.2017”
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
