GST is payable on full billing amount including employer contribution EPF and ESIC â€“ West Bengal AAR.
Ex-servicemen Resettlement Society Vs West Bengal AAR
[Order no. 09/WBAAR/2021-22 dated 30/09/2021]
Fact of Case;
The Applicant is a registered society providing security services and scavenging services (Karma Bandhus) to different Medical Colleges & Hospitals.
As per west Bengal Labour law they are charging EPF and ESIC at specified rate in bill and charges GST @ 18% on gross bill amount in every month for providing said services to the Government Hospitals.
The Audit Authority of west Bengal in course of audit of Bankura Sammilani Medical College and Hospitals had raised the objection that GST should be charged on management fees only.
The Applicant has sought the advance ruling on;
- Whether GST to be payable on Management Fee/Administrative charges only or otherwise complete billing amount?
- Whether employer portion of EPF & ESl amount of the bill are exempted for paying GST?
In matter of Ex-servicemen Resettlement Society, West Bengal Authority for Advance Ruling held that;
EPF and ESIC contribution made by employer does not fall in exclusion under sub section (3) of Section 15, hence there is no room left to deduct any amount from bill like management fees or employer portion of EPF and ESI for the purpose of determination of value of supply under Section 15 of the CGST Act.
Meaning thereby any labour contractor raises a bill including Employer portion of Employee Provident Fund or Employee State Insurance, they have to charge GST on entire billing amount including EPF & ESIC.