AAR Rules 18% GST on Supply of Manpower services to Zila Panchayat [Read Order]

The Karnataka Authority of Advance Ruling (AAR Karnataka) in the matter of M/S. MANISH MANPOWER AGENCY has held that 18% GST will apply to the Supply of Manpower services to Zila Panchayat.

The applicant is a Partnership firm, registered under the provision of the Central Goods and Services Tax Act, 2017, as well as the Karnataka Goods and Services Tax Act, 2017 (hereinafter referred to as the CGST Act and KGST / SGST Act respectively. The applicant is engaged in supplying manpower services to Zilla Panchayat, Taluk Panchayat, Forest Department, KPTCL, Railway Department etc.

The Question and Ruling are as follows:

1. Whether the supply of manpower services to Zilla Panchayat (Social Welfare Department) and Taluka Panchayat are exempted from GST under Sl. No.3 of Notification No.12/2017-Central Tax (Rate) as Pure Services?

RULING

Supply of manpower services like cleaning staff, cook, assistant cook, staff nurse, teachers and watchmen to hostels and residential schools/ colleges run by the Social welfare department is exempted since the manpower services provided are by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution.

Supply of Manpower services like Data Entry Operator, Drivers, “D” Group staff, FDA, SDA, Typists to Zilla Panchayat/ Taluk Panchayat/ Social welfare department/ Backward Classes Welfare Department are not by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution and hence attracts GST at the rate of 18% (CGST@ 9% and KGST@ 9%).

For Official Ruling Download PDF Given Below: