Bangalore Metro Denied GST Exemption: BMRCL Not Government Authority under Notification 12/2017

The present advance ruling (No. KAR ADRG 30/2025) dated July 28, 2025, has been filed by a company named Bangalore Metro Rail Corporation Limited (Applicant) under Section 97 of the CGST Act and Section 97 of the KGST Act, 2017, in form GST ARA-01, discharging the fee of Rs. 5,000 each under the CGST Act and the KGST Act, having a registered address at 3rd Floor, BMTC Complex, K H Road, Shanthinagar, Bengaluru Urban-560027, with GSTIN or User ID: 29AAACB4881D1ZQ.

The applicant is a company formed under the Companies Act, 1956. It is a joint venture between the Government of India and the Government of Karnataka, with both holding 50% of the shares. This company was specially created to carry out and manage the Bangalore Metro Rail Project.

The applicant further mentioned that the metro project includes a north-south corridor that is 17 km long, with a total estimated cost of INR 4,202 crores. The applicant owns the entire metro network, including the tracks, metro stations, and all related structures within Bangalore City. The applicant has invited private companies to partly finance the costs to raise additional funds for the project. One among those private companies, Embassy Property Developments Private Limited, agreed to invest a certain amount for building the Kadubeesanahalli Metro Station on the Outer Ring Road. In return for this investment, the applicant will offer certain benefits or concessions to EPDPL.

Questions Asked by Appellant:

The appellant, Bangalore Metro Rail Corporation Limited, has asked the following question, seeking the Karnataka Advance Ruling No. KAR ADRG 30/2025, dated July 28, 2025:

“Question 1. Whether the Applicant is a “Government Authority” vide Paragraph-2(zf) of Notification No. 12/2017-CT (Rate) dated 28.06.2017 as amended from time to time, and would fall within the scope of Sl. No.4 of the said exemption notification?

Question 2. Whether the activity of grant of concession in terms of the MOU dated 04.06.2018 to the “Concessionaire” is eligible for exemption from payment of GST vide Sl. No.4 of the exemption notification no.12/2017-CT (Rate) dated 28.06.2017. Consequently, does no GST need to be discharged by the Applicant on such activity?”

What Did the Ruling Say?

In accordance with the Authority for Advance Ruling in Karnatakа Goods and Services Tax Vanijya Therige Karyalaya, Kalidasa Road, Gandhinagar, Bengaluru – 560 009, the following answer has been given to the above question:

Answer 1: For the first question, the advance ruling ruled that the applicant does not fall under “Government Authority” in terms of Paragraph-2 (zf) of Notification No. 12/2017-CT (Rate) dated 28.06.2017, as amended, hence does not fall within the scope of Sl. No.4 of the said exemption notification.

Answer 2: For the second question, the advance ruling ruled that the activity of grant of concession in terms of the MOU dated 04.06.2018 to the “Concessionaire” is not eligible for exemption from payment of GST vide Sl. No.4 of exemption notification no.12/2017-CT (Rate) dated 28.06.2017. The authority gave the reason that the company does not qualify to be a “Government Authority”.