Classification of service— In the instant case, the applicant on being awarded a sub-contract from M/s Patil Rail Infrastructure Pvt. Ltd., undertakes the work of conversion of Short Welded Rails (“SWR”) to Long Welded Rails (“LWR”) by Flash Butt Welding process on the tracks running from Furkating (FKG)-Jorhat (JTTN)-Mariani (MXN), in the state of Assam. The work also includes supply of all assistance of labour for welding of rail joints.

The applicant has made this application and raised following question—

a. Whether the services provided by the applicant is that of a works contractor, falling under any of the entries under Heading 9954?

b. If the answer to (a) is yes, then the Sr. No under which it should be classified.

c. Whether the services provided by the applicant is that of a Job Worker, falling under Heading 9988 [(Manufacturing services on physical inputs (goods) owned by others) Sr. No26 (id) i.e Services by way of job work other than 78b[(i), (ia), (ib), (ic) and (ica)] above; having tariff rate of 12% under Notification No. 11/2017-Central Tax (Rate) as amended.

d. If the services do not fall under any of the above categories, what should be the HSN code and GST rate?

Held that— The work being undertaken by the applicant as a sub-contractor for conversion of Short Welded Rails (“SWR”) to Long Welded Rails (“LWR”) by Flash Butt Welding process on the railway tracks along with supply of labour services shall be treated as composite supply of services falling under Tariff 995429 and shall be taxable @ 18% vide serial number 3(xii) of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017, as amended from time to time [corresponding West Bengal State Notification No.1135 F.T. dated 28.06.2017].