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September 1, 2022

No GST on lawn cleaning and sweeping services provided to the horticulture department

by CA Shivam Jaiswal in GST, Legal Court Judgement

No GST on lawn cleaning and sweeping services provided to the horticulture department

Facts and Issue of the Case

The Applicant is a Proprietorship concern registered under the provisions of Central Goods and Services Tax Act, 2017 as well as Karnataka Goods and Services Tax Act, 2017. The Applicant is engaged in providing manpower services. They are proposing to submit a bid in response to the tender floated by the Department of Horticulture, Government of Karnataka for certain services.

The applicant has sought advance ruling in respect of the following questions:

i. Whether the services proposed to be provided by it to the Department of Horticulture for cleaning and sweeping of lawns and garden path areas and segregation and transport of the garbage are liable for GST, and if yes, then at what rate?

Whether the services proposed to be provided by it to the Department of Horticulture for supply of manpower for garden maintenance on outsource basis to the Department of Horticulture are liable for GST, and if yes, then at what rate?

The applicant states that their proposed activities that is, cleaning and sweeping of lawns and garden path areas, segregation and transport of the garbage and supply of manpower for garden maintenance are intended to be provided to the Government Department of the State of Karnataka i.e., the Department of Horticulture. The applicant states that Horticulture is the art and science of growing plants and includes landscaping, soil management, designing, construction and maintenance of gardens. The purpose of the work undertaken by the Horticulture Department is to ensure that the gardens are aesthetically beautiful, provide excellent ambience and provide an authentic environment for visitors and public.

The applicant states that the Department of Horticulture would fall within the definition of “Government” for the purposes of GST and as such, pure service received by it would be exempt from OT in accordance with the following provisions / notifications.

The applicant states that the services in question, to be provided to the Department of Horticulture, involve essentially the services of sweeping and segregating collected garbage; and supply of manpower for garden maintenance. In the case of services of sweeping, and collection of garbage, the requirements stipulated as per the tender documents include workers, auto tippers and garbage compactor. There is no transfer of property in goods involved in this contract. Invitation for tenders for the performance of this work is issued by the Office of the Deputy Director of Horticulture, Sri Chamarajendra (Cubbon) Park, Bangalore. In the case of supply of manpower for maintenance also, the requirement is only to deploy a certain number of contract personnel for the work. Invitation for tenders for the performance of this work is issued by the Office of the Assistant Director of Horticulture, Karnataka Siri Horticulture Garden, Ooty. The applicant states that there is no supply of or transfer of property in goods involved whatsoever in both cases. That being the case, the supply is comprised purely of services and therefore would be a “pure service”. The applicant states that the Department of Horticulture, is a Government Department of the State of Karnataka, and therefore falls within the definition of “government” as per Section 2(53) of the Karnataka Goods and Services Tax Act, 2017.

The services provided are in relation to the maintenance of parks, which falls within the ambit of “provision of urban amenities and facilities such as parks, gardens, playgrounds”, which is an activity covered under the Twelfth Schedule, falling within the purview of Article 243W of the Constitution of India.

Observation by the court

At the outset the court would like to make it clear that the provisions of CGST Act, 2017 and the KGST Act, 2017 are in pari-materia and have the same provisions in like matter and differ from each other only on a few specific provisions. Therefore, unless a mention is particularly made to such dissimilar provisions, a reference to the CGST Act would also mean reference to the corresponding similar provisions in the KGST Act.

The court  had  considered the submissions made by the applicant in their application for advance ruling. The court  have also considered the issues involved on which advance ruling is sought by the applicant and the relevant facts along with the arguments made by the authorized representative and also their submissions made during the time of hearing. The Applicant wishes to know the GST liability on the activities proposed to be undertaken by him, which is, cleaning and sweeping of lawns and garden path areas, segregation and transport of the garbage and supply of manpower for garden maintenance. The tenders for the proposed activities are floated by the Department of horticulture, Government of Karnataka.

The applicant states that the proposed services involve sweeping arid segregating collected garbage; and supply of manpower for garden maintenance. In the case of services of sweeping, and collection of garbage, the requirements stipulated as per the tender documents include workers, auto tippers and garbage compactor. The Applicant also states that there is no transfer of property in goods involved in this contract. This proposed service is to be provided in Cubbon park, Bangalore, as per the letter of invitation for Tenders. The applicant states that the proposed services also involve supply of manpower for maintenance of garden and this involves only deployment of certain number of personnel for work. This proposed service is to be provided in Karnataka Siri Horticulture Garden, Ooty, Tamilnadu, as per the letter of invitation for Tenders.

The applicant is providing manpower services for cleaning and sweeping of lawns and garden path areas, segregation and transport of the garbage in Cubbon Park and for maintenance of garden in Sin Horticulture Garden, Ooty, Tamilnadu. This is in relation to function entrusted to a municipality under article 243W of the constitution which is covered by 12th entry of twelfth schedule which says ‘Provision of urban amenities and facilities such as parks, gardens, playgrounds’. This manpower services are provided to Horticulture Department, Government of Karnataka. The Applicant is providing services to the state government which is covered by 12th entry of twelfth schedule of the constitution which says Provision of urban amenities and facilities such as parks, gardens, playgrounds’.

Conclusion

The services proposed to be provided by the Applicant to the Department of Horticulture for cleaning and sweeping of lawns and garden path areas and segregation and transport of the garbage are liable for GST .

The services proposed to be provided by the Applicant to the Department of Horticulture for supply of manpower for garden maintenance on outsource basis to the Department of Horticulture are liable for GST .

In-re-Indian-Security-And-Personnel-Arrangements-GST-AAR-Karnataka

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