{"id":240943,"date":"2020-12-19T12:05:52","date_gmt":"2020-12-19T06:35:52","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=240943"},"modified":"2021-01-08T12:59:17","modified_gmt":"2021-01-08T07:29:17","slug":"wb-aar-whether-composite-supply-of-crushed-food-grains-to-state-government-shall-be-exempted-from-gst-ambit-of-gst-in-regard-to-govt-functions-for-public-welfare-explained","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2020\/12\/19\/wb-aar-whether-composite-supply-of-crushed-food-grains-to-state-government-shall-be-exempted-from-gst-ambit-of-gst-in-regard-to-govt-functions-for-public-welfare-explained\/","title":{"rendered":"WB AAR | Whether composite supply of crushed food grains to State Government shall be exempted from GST? Ambit of GST in regard to Govt. functions for public welfare [Explained]"},"content":{"rendered":"

West Bengal Authority for Advance Ruling, Goods and Services Tax:\u00a0<\/strong>The Bench of Susmita Bhattacharya (Joint Commissioner, CGST & CX) and Parthasarathi Dey (Senior Joint Commissioner, SGST), held that no GST will be applicable on composite supply of crushing the food grains belonging to the State Government and delivery of the crushed grains will be exempted as provided the proportion of the packing materials in the composite supply in value terms does not exceed 25%.
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The applicant intends to supply to the State Government the service of crushing food grains. The processed food grain will be used for distribution through the Public Distribution System.\u00a0<\/span><\/p>\n

Applicant sought a ruling whether the above-stated activity would be exempted under Sl No. 3 or 3A of Notification No 1212017 CT (Rate) dated 28-06-2017 (corresponding State Notification No. 1136 – FT dated 28-O6-2017), as amended (hereinafter collectively called the Exemption Notification).<\/span><\/p>\n

Applicant was unregistered under the GST Act.<\/p>\n

Observations & Findings\u00a0<\/span><\/h3>\n
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ln Circular No. 5112512018-GST dated 31-07-2018 the Central Government clarified that the service tax exemption under Sl No. 25(a) of Notification No. 2512012 dated 20-06-2012 has been substantially<\/em>, although not in the same form, continued under GST vide Sl No. 3 and 34 of the Exemption Notification. Sl No. 25(a) of the ST notification under the Service Tax exempts “services provided to the Government, a local authority or a governmental authority by way of water supply, public health, sanitation, conservancy, solid waste management or slum improvement and up-gradation.”<\/em><\/span><\/p>\n

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“…under the GST the ambit has been broadened to include any such functions that are performed by a Panchayat or a Municipality under specific provisions of the Constitution. These functions are in the nature of public welfare service that the governments on their own, and sometimes through governmental authorities\/entities, do provide to the citizens. When the activity is in relation to any such function, the supply to the governments or governmental authorities\/entities or local authorities is exempt from paying GST.”<\/p>\n<\/blockquote>\n

Hence, in view of the above, applicant’s eligibility under the above-stated SI No. 3 or 3A will have to be examined under three aspects:<\/p>\n

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