The applicant received a contract for construction of channels from Irrigation and Flood control Department, Govt. Of Jammu and Kashmir.
The contract would include the construction of canals involving earthwork in excavation and re-excavation of drainage channels.
It filed an application for advance ruling to determine supply of work contract service would attract 5% GST or not. It was submitted that the recipient was the State Government but now it would be the Union territory of Jammu and Kashmir.
The Authority for Advance Ruling noted that the applicant would be engaged in the construction of works contract work involving earthwork in excavation and re-excavation of drainage channels.
The Executive Engineer certified that the total value of the works contract would consist primarily of dredging and earth work excavation and involvement of material would be less than 15% of the total value of the work.
Since, this contract would consist of more than 75% of the value of the contract, it would be taxable at 5% and fall under Entry No. 3(vii) of Notification No. 8/2017-Integrated Tax (Rate), 28-6-2017.
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