Page 176 - GSTL_23rd July 2020_Vol 38_Part 4

542 GST LAW TIMES [ Vol. 38
12/2017-C.T. (Rate), dated 28-6-2017, and accordingly will attract Nil rate of GST,
as the said services are being provided by the Appellant to their employees, who
are certainly non-business entities.
58. Now, we will examine question 1(e) asked by the Appellant as to
whether Community hall provided on rental basis to employees of the factory
will attract GST or otherwise. In this regard, the Appellant has submitted as
under :
There is a community hall within the factory estate that is let to be used
by the factory to its employees for their personal purposes like family
gatherings, marriages, other social functions etc. Charges in terms of
monetary consideration are recovered by the factory from its employees
in lieu of such use. As per clause (zz) of the definitions contained in Noti-
fication No. 12/2017-Central Tax (Rate), “Renting in relation to immova-
ble property” means allowing, permitting or granting access, entry, oc-
cupation, use or any such facility, wholly or partly, in an immovable
property, with or without the transfer of possession or control of the said
immovable property and includes letting, teasing, licensing or other sim-
ilar arrangements in respect of immovable property. Thus, the service
provided by the factory to its employees for letting them use cultural hall
for their personal purposes falls within the definition of “Renting in rela-
tion to immovable property”. However, keeping in view the above dis-
cussed Sr. No. 6 of the exemption list on supply of services as per Notifi-
cation No. 12/2017-Central Tax (Rate), such services provided by Ord-
nance Factory Bhandara attract ‘NIL’ rate of tax since the provider of
service (Ordnance Factory Bhandara) is “Central Government” and the
recipient of services (factory employees) are non-business entities. The
AAR, Maharashtra had ruled that the said exemption is not applicable to
Ordnance Factory Bhandara since it is not “Government”.
59. As regards the above question raised by the Appellant, we refer to
the observations made in the above para 56 and conclude that the Appellant, be-
ing ‘the Central Government’ is providing services of renting of immovable
property to its employees, which are non-business entities, hence such services
rendered by the Appellant will not be subject to GST in accordance with the pro-
visions of Sr. No. 6 of the Notification No. 12/2017-C.T. (Rate), dated 28-6-2017.
60. Now, we will examine question 1(f) asked by the Appellant as to
whether School bus facility provided to the children of the employees will be
subject to GST or not. In this regard, the Appellant’s submissions are as under :
Ordnance Factory Bhandara provides the service of pick and drop of the
children of its employees from school located outside the factory via bus
owned by the factory. Charges in terms of monetary consideration are
recovered by the factory from its employees in lieu of such service pro-
vided to them. So, keeping in view the above discussed Sr. No. 6 of the
exemption list on supply of services as per Notification No. 12/2017-
Central Tax (Rate), such services provided by Ordnance Factory Bhanda-
ra attract ‘NIL’ rate of tax since the provider of service (Ordnance Facto-
ry Bhandara) is “Central Government” and the recipient of services (fac-
tory employees) are non-business entities. The AAR, Maharashtra had
ruled that the said exemption is not applicable to Ordnance Factory
Bhandara since it is not “Government”.

GST LAW TIMES  23rd July 2020  176