Classification of service— In the instant case, the applicant raised following question—

Q1. 1. The rate applicable for the works contract service provided to the Telangana State Industrial Infrastructure Corporation Limited (TSIICL) which is wholly owned by the Government of Telangana State by way of construction of building on their land. Whether it is 12% as the for Telangana State Industrial Infrastructure Corporation Limited (TSIICL) is wholly owned by the Government of Telangana or 18% as the for Telangana State Industrial Infrastructure Corporation Limited is a business entity and collecting rent for letting our Godown/Building from its customers.

The applicant entered into agreements with Telangana State Industrial Infrastructure Corporation Limited (TSIICL) for execution of contracts of buildings, warehouses, godowns since 2020. The TSIICL inturn letting out the godowns for its customers on rent. This amounts to use of the constructed premises for the purpose of business.

The contract is for "construction of ware house & cold storage at primary processing centre in Jillela Village, Tangalapally Mandal of Rajanna Sircilla District. Further, the applicant has also averred that these godowns will be given on rent by TSIICL. Therefore, the concessional rate of tax is not applicable to this transaction and tax payable will be 9% CGST & SGST each. Further, this entry was amended in Nov' 2021 vide Notification No. 15/2021 dt. 18.11.2021 and the phrases 'Government Entity' & 'Governmental Authority' were deleted from the Entry at S.No. 3(vi) of Notification No. 11/2017 with effect from 01.01.2022. Thus the works executed even for the 'Governmental Entity or 'Government Authority' will be taxable @9% CGST & SGST each.

Held that— The applicant is executing contract of construction of ware houses & cold storages godowns for TSIICL who intum are letting out these facilities on rent. Therefore, the rate of tax applicable on these contracts is 9% CGST & SGST each