Odisha AAR says separate registration must for construction work in state

The ruling is in conflict with position taken by other AARs; industry wants CBIC clarification

The Odisha-based authority for advance ruling (AAR) has held that the Konkan Railway Corporation Limited requires a separate registration in the state for carrying out construction work given by the East Coast Railway. The order is in conflict with earlier ones by other AARs.

The place of service is important for imposition of Goods and Services Tax (GST) by Odisha.

Konkan Railway, registered in Maharashtra’s Thane district, received a letter of acceptance (LoA) earlier this year for executing a Rs 337.18 crore project for constructing bridges and other allied works of a new rail line of East Coast Railway in Budha district of Odisha.

The Odisha AAR held that Konkan Railway is required to be registered under the Odisha Goods and Services Act, 2017 and the Central Goods and Services Act, 2017 for the contract. AAR held that the location of the supplier would be the project site.

Earlier, the Karnataka-based AAR had ruled in the GEW (India) Pvt Ltd case that no separate registration is needed by the company in the state and invoices can be raised from its registered office in Noida in Uttar Pradesh.

Similarly, the Karnataka AAR in RITCO Shopping Complex case had held that the company need not take a separate registration in the state. However, the company is at liberty to take the same if it intends a fixed establishment at the project site in Karnataka, the authority had said.

Saurabh Agarwal, tax partner at EY, said given that the past few advance rulings have held that location of supplier would be the registered place of business and not the project site, industry would look at the Central Board of Indirect Taxes and Customs to issue a clarification on this aspect to avoid disputes.