The Tamil Nadu Authority for Advance Ruling ( AAR ) has held that works contract service for construction of residential quarters to employees of Kudankulam Nuclear Power Project (KKNPP) attracts 18% GST
The applicant, SOM VCL (JV), engaged in execution of civil engineering and other general construction contracts for various Government departments and organizations. The parties SOM Projects Pvt. Ltd. and M/s Varindera Constructions Ltd. have entered into joint venture under the name SOM VCL (JV) solely for carrying out the works contract service for Kudankulam Nuclear Power Corporation of India Ltd (NPCIL).
The applicant submitted they are awarded the project of constructing 360 numbers of residential quarters for usage of employees at Anuvijay Township, Kudankulam. It has been submitted by the applicant that this work order has been received directly from M/s Nuclear Power Corporation of India Ltd., which is a government entity and there is no intermediary involved in the whole scheme of transactions. Hence the applicant submitted that works contracts service rendered by them is covered under Sl. No. vi of Notification No. 11/2017 attracting 12% GST.
The Authority observed that the work entrusted to NPCIL is to implement atomic power projects for the generation of electricity. Thus the works contract service rendered by the applicant in construction of residential quarters fails to satisfy the condition stipulated in Sl. No. vi of Notification No. 11/2017. Thus it is clear that the service rendered by the applicant is not covered under the above said notification.
The Coram of Sri T.G.Venkatesh, I.R.S. and Smt. K. Latha has ruled that “the execution of works contract service for the construction of residential quarters to the employees of Kudankulam Nuclear Power Project is note covered under Sl. No. vi of Notification No. 11/2017and the applicable rate is 18% GST”.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan AdFree. Follow us on Telegram for quick updates.
