18% GST leviable on supply of services of repair & maintenance of tracks for Indian Railways: AAR

Case Details: Authority for Advance Rulings, Uttar Pradesh India Thermit Corporation Ltd., In re - [2023] 146 taxmann.com 263 (AAR-UTTAR PRADESH)

Judiciary and Counsel Details

• • Vivek Arya & Rajendra Kumar Member
  • Kunal Kapoor, AR for the Applicant.

Facts of the Case

The applicant was engaged in the supply of services to Indian Railways. It received a contract of welding and painting of construction lines and maintenance and renewal of open lines from Indian Railways. It filed an application for advance ruling to determine taxability of services provided by it.

AAR Held

The Authority for Advance Ruling observed that paints and welding material used in repair and maintenance of open line and construction line would not amount to transfer of property in goods. Moreover, the contract for such painting and welding work shall not be covered under definition of ‘original work’ and therefore, the benefit of concessional rate shall not available in absence of a contract for building, construction, fabrication, completion, erection, repair, maintenance, etc. of any immovable property. Thus, it was held that these services supplied to Indian Railways would be taxable at the rate of 18% under GST.