Page 159 - GSTL_16th July 2020_Vol. 38_Part 3

2020 ] IN RE : SHREE HARI ENGINEERS & CONTRACTORS 397
Territory, a local authority, a Government Authority or a Government Entity; and (iv)
The civil structure or original works must be predominantly meant for use other than for
commerce, industry, or any other business or profession. [paras 14, 14.1, 14.2, 14.3, 14.4,
15, 16, 18]
Government Authority - Work entrusted to Railtel Corporation of
India Ltd. not covered not function entrusted by Central Government, State
Government, Union Territory or a local authority - Said Corporation not Gov-
ernment Authority - Articles 243G and 243W of Constitution of India. [para
14.3]
Ruling in favour of department
REPRESENTED BY : Shri Karan Thacker, CA, for the Assessee.
[Order]. - Brief Facts : The applicant vide their application for Advance
Ruling has submitted that they are engaged in the business of providing works
contract services. They have been awarded a Tender by M/s. Railtel Corporation
of India Limited (A Government of India Undertaking, Ministry of Railways).
The work to be performed is that of excavation of trenches and laying of OFC
(Optical Fiber Cable) through ducts, testing, commissioning of OFC.
2. The applicant submitted that the said work is an Original work, that
the end use of the Optical Fibre Cable is for the purpose of connecting with the
Gram Panchayat for socio-economic development hence it is not for the purpose
of Commerce, Industry or any other business or profession. They have also sub-
mitted that M/s. Railtel Corporation of India Ltd. by whom they have been
awarded the tender has 100% share holding by Union Government and is a Gov-
ernment of India Enterprise.
3. The applicant has also submitted photocopies of (i) Tripartite Memo-
randum of Understanding (MOU) between Department of Telecommunications
of Government of India, Government of Gujarat and Broadband Network Ltd.
dated 12-4-2013. (ii) Letter of acceptance dated 26-10-2017 issued by M/s. Railtel
Corporation of India Ltd. to M/s. Shree Hari Engineers and Contractors, Bhuj-
Kachchh containing the schedule of work to be carried out by the applicant
alongwith the rates. (iii) Agreement/Contract between M/s. Railtel Corporation
of India Ltd. and M/s. Shree Hari Engineers and Contractors, Bhuj-Kachchh dat-
ed 9-2-2018 for Rs. 1,69,75,575/- (iv) GST Notification No. 24/2017-CT, dated
21-9-2017. (v) Few R.A. bills issued by the applicant to M/s. Railtel Corporation
India Ltd.
4. The applicant has put the following question for advance ruling in
their application :-
“Whether the Contract with Railtel Corporation of India Ltd. will fall under
the Notification No. 24/2017-Central Tax (Rate) Sr. No. 3(iv)-Construction
Service or Original Work to Government Authority, and the rate of tax ap-
plicable be 12%?”
5. The applicant vide their submission dated 19-3-2020 have submitted
that M/s. Broadband Network Limited is a corporate body incorporated under
the category of ‘Union Government Company’ under Companies Act, that M/s.
Bharat Broadband Network Ltd. has entered into a MOU with the Government
of India, Government of Gujarat and itself for laying for Optical Fiber Cable, that
the scope of the work includes : (a) connecting the gram panchayats of India on
Optical fiber using the fibers of other PSUs/TSPs and/or laying incremental fiber
network for providing broadband connectivity. (b) setting up of suitable telecom
GST LAW TIMES  16th July 2020  159