Page 161 - GSTL_14th May 2020_Vol 36_Part 2

2020 ] IN RE : NATIONAL DAIRY DEVELOPMENT BOARD 263
or control to carry out any function entrusted to a municipali-
ty under article 243W of the Constitution’.
(ii) … … …..”
13.6 As the appellant has not submitted anything evidencing whether it
has been set up or established to carry out any function entrusted to a Municipal-
ity under Article 243W of the Constitution or to a Panchayat under Article 243G
of the Constitution, it is not possible to decide whether the appellant fulfills the
said condition or otherwise.
13.7 As a result, in absence of sufficient information provided by the
appellant, we are unable to determine whether M/s. NDDB is “Governmental
Authority” as per definition of “Governmental Authority” provided vide clause
(zf) of Para 2 of Notification No. 12/2017-Central Tax (Rate), or otherwise.
14.1 The main question involved in this case is whether exemption un-
der Sr. 4 of Notification No. 12/2017-Central Tax (Rate) is admissible to NDDB
for providing service of renting of immovable property to ‘Anandalaya Educa-
tional Society’. The said Sr. 4 of Notification No. 12/2017-Central Tax (Rate) pro-
vides exemption to services by Governmental authority by way of any activity in
relation to any function entrusted to a municipality under Article 243W of the
Constitution.
14.2 The appellant NDDB has provided service of ‘Renting of Immova-
ble Property” to ‘Anandalaya Educational Society’. The argument of the appel-
lant is that the services of “Renting of Immovable Property” for educational insti-
tute would be covered by item 13 of Twelfth Schedule read with Article 243W of
the Constitution, which covers “promotion of cultural, educational and aesthetic
aspects”. It has been submitted that the appellant established the school by way
of trust in the name of ‘Anandalaya Educational Society’ wherein NDDB Chair-
man would be the Chairman of the trust and has full power to select members of
the Board. It is contended that incorporation of educational institute and provid-
ing of various related services for development is appellant’s statutory function
in line with Article 243W.
14.3 We find that the activity of ‘Renting of Immovable Property’ is not
a function entrusted to a municipality under Article 243W of the Constitution.
Therefore, services by NDDB by way of ‘Renting of Immovable Property” cannot
be said to be service in relation to any function entrusted to a municipality under
Article 243W of the Constitution. The phrase ‘in relation to any function’ refers
not to what activities the recipient of the service is engaged in, but to what ser-
vice the supplier is providing. In order to be covered under Sr. 4 of Notification
No. 12/2017-Central Tax (Rate), the service by a ‘Governmental authority’ itself
should relate to an activity listed under Article 243W read with Twelfth Schedule
of the Constitution. ‘Renting of Immovable Property’ is not covered under Arti-
cle 243W read with Twelfth Schedule of Constitution.
14.4 In view thereof, we hold that the exemption provided vide Sr. 4 of
Notification No. 12/2017-Central Tax (Rate) is not admissible to appellant for
providing service of ‘Renting of Immovable Property’ to ‘Anandalya Educational
Society’.
15. Therefore, we modify the Advance Ruling No. GUJ/GAAR/
RULING/2019/2, dated 22-2-2019 of the Gujarat Authority for Advance Ruling
by holding that -

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