The Bangalore Bench of Authority for Advance Ruling (AAR) has ruled that the supply of work contract services to Indian railway including construction of railway and tunnels would be eligible for Goods and Service Tax at 18%.
The applicant SKS Swamy and Company was engaged in executing works contract to Indian Railways such as construction of Rail under bridge works, construction of tunnels and supplying and stacking of ballast, earth work and also sub contract of all the mentioned works. They had submitted contract agreement where in the Applicant entered into a contract with Konkan Railway Corporation Limited for supplying and stacking of ballast at Thakur ballast depot, loading into KRCL hoppers etc.
The applicant had sought advance ruling in respect of what percentage of GST output tax should be charged for our nature of works contract executed to Indian Railways on certain works.
BK Srinivas appeared for the applicant.
The Karnataka Bench of Income Tax Authority of M.P Ravi Prasad (State Member) and Kiran Reddy T(Central Member) held that works contract services like construction of Railway under Bridge and Tunnels executed to Indian Railways by the applicant would be exigible to GST at 18% and works contract services involving predominantly earth work executed to Indian Railways (Central Government) by the Applicant would be exigible to GST at 12% if the Applicant was providing the services either as a main contractor or as a subcontractor to main contractor. The bench further held that the supply of ballast to railways would be eligible for GST at 5%.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
