The Uttar Pradesh Authority for Advance Ruling (AAR) has held that the services provided to State Urban Development Agency (SUDA) and for Project Management Consultancy (PMAY) in relation to functions entrusted under Article 243w and 243G of the constitution would be qualified as pure services.
Applicant- KDS services (P) ltd had sought advance ruling as to whether the project development services provided by the applicant under the contract from state urban development agency (SUDA) and Project Management Consultancy contract would qualify as an activity under article 243M and 243G and pure service.
Pankaj Sukla, who appeared for the applicant submitted that the services provided by the applicant under the contract were related to the functions entrusted to municipalities and panchayats under article 243M and 243G of the constitution of India. He also contented that the such services would be treated as pure services and would be eligible to be excepted from Central Goods and Service Tax (CGST).
The two member bench of Rajendra Kumar (Additional Commissioner CGST) and Vivek Arya (Joint Commissioner SGST) observed that the State Urban Development Agency (SUDA) and PMAY which had been established as the state level nodal agency under urban employment and poverty alleviation program could be treated as an activity under Article 243M and 243G of the constitution. The bench also held that the services could be treated as the pure services as it had been provided to the governmental agencies.
The bench further ruled that such services being pure services would be exempted from tax.
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