The Authority for Advance Ruling ( AAR ), Goa has held that the activity of issuance of Pollution Under Control Certificate for vehicles issued by the Authorised Service Centre is not covered under SAC 9991 and is covered under Residual Entry and hence, should be taxed @ 18% GST.
The present application has been filed under section 97 of the Goa Good and Services Tax Act, 2017 and the Central Goods and Services Tax.
The appellant is the Authorised Service Centre appointed by Government of Goa, Directorate of Transport to carry out the services of Pollution Testing of Commercial and Non-Commercial Vehicles. The appellant carries out the Pollution testing and issues Pollution Under Control Certificate, which is a mandatory certificate as per section 190(2) of the Motor Vehicle Act, on payment of prescribed fees fixed by the Government.
The certificates are issued only if the emission of the vehicle is in alignments with standard pollution norms and are not harmful to the environment.
The applicant purchases blank leaflets books from Directorate of Transport on payment of prescribed rate per leaf and issues same leaflets to the customers after testing Pollution Control Test at the higher rate which is also prescribed by Directorate of Transport. The difference between the cost of procurement of the leaflets and issuing the same to the vehicle owners is the consideration charged for services rendered by him in issuing Pollution Control Certificate to the Vehicle Owners. They contended that the services rendered by the applicant is not covered under Schedule III appended to the Central Goods and Service Tax Act, 2017 as well as Goa Goods and Service Tax Act, 2017.
The authority noted that the services provided by the applicant are also not fully covered under SAC 9991.
“As SAC 9991 covers services provided by the Central Government, State Government, Union Territory or Local Authorities directly. It is not a pure service provided by the Central Government, State Government, Union Territory or. Local Authorities or by a Government Authority by way of any activity in relation to any function entrusted to a Panchayat under Article 243G of the Constitution or relation to any function entrusted to the Municipality under the Article 243W of the Constitution. The Government has authorized the applicant to issue Pollution Control Certificate on payments. It is the service provided by the applicant to the customers on payment of service charges. Since the services of testing of Pollution are provided on payment of service charge, GST is payable at the applicable rate,” the authority said.
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