Important Keyword: Notification 17/2018 UTGST, UTGST clarification 2018, Government services GST India, Section 8(3) UTGST, GST on government services, Notification 11/2017 amendment, UTGST public authority definition, GST legal update July 2018,
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[F. No.354/13/2018-TRU]
Government of India
Ministry of Finance
(Department of Revenue)
New Delhi, the 26th July, 2018
Notification No. 17/2018 - Union Territory Tax (Rate): Seeks to insert explanation in an item in notification No. 11/2017-Union Territory Tax (Rate) by exercising powers conferred under section 8(3) of UTGST Act, 2017.
GST: [TO BE PUBLISHED IN THE GAZZETE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]
G.S.R (E).- In exercise of the powers conferred by sub-section (3) of section 8 of the Union Territory Goods and Services Tax Act, 2017 (14 of 2017), the Central Government, on the recommendations of the Council, and on being satisfied that it is necessary so to do for the purpose of clarifying the scope and applicability of the notification of the Government of India, in the Ministry of Finance (Department of Revenue) No.11/2017- Union Territory Tax (Rate), dated the 28thJune, 2017, published in the Gazette of India,
Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 702(E), dated the 28thJune, 2017, hereby inserts following Explanation in the said notification, in the Table, against serial number 3, in column (3), in item (vi), namely:-
“Explanation. - For the purposes of this item, the term ‘business’ shall not include any activity or transaction undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities.”.
2. This notification shall come into force with effect from 27th of July, 2018.
(Gunjan Kumar Verma)
Under Secretary to the
Government of India
Note: -The principal notification No. 11/2017 - Union Territory Tax(Rate) was published in the Gazette of India, Extraordinary, dated the 28th June, 2017, vide number G.S.R. 702 (E), dated the 28th June, 2017 and was last amended by notification No. 1/2018- Union Territory Tax (Rate), dated the 25thJanuary, 2018 vide number G.S.R. 75 (E), dated the 25thJanuary, 2017.
📚 Frequently Asked Questions (FAQs): Notification No. 17/2018 – Union Territory Tax (Rate)
Q1: What is Notification No. 17/2018 - Union Territory Tax (Rate)?
Answer:
It is a GST clarification notification issued on 26 July 2018 inserting explanation regarding “business” under Notification 11/2017 17.
Q2: Under which section was it issued?
Answer:
It was issued under Section 8(3) of the UTGST Act, 2017.
Q3: What does the clarification say about ‘business’?
Answer:
It states that government activities performed as public authorities are not treated as business under that specific GST entry 17.
Q4: From when is this applicable?
Answer:
It is effective from 27 July 2018 17.
Q5: Does this mean government never pays GST?
Answer:
No. Government can still be liable for GST when engaged in commercial activities.
Q6: What is meant by “public authority”?
Answer:
Activities performed under constitutional/statutory powers like issuing certificates, licenses, or regulatory functions.
Q7: Does this affect private contractors working for government?
Answer:
No. Private contractors providing services to government may still be taxable.
Q8: Is renting of government property taxable?
Answer:
If done commercially, yes. If part of sovereign/public authority function, treatment may differ.
Q9: Does this apply in all states?
Answer:
This applies to Union Territories under UTGST. Similar CGST notification applies in states.
Q10: What was amended in Notification 11/2017?
Answer:
An explanation was inserted in Serial No. 3, Item (vi) to clarify scope of “business”.
Q11: Can government departments take GST registration?
Answer:
Yes, if engaged in taxable supplies.
Need GST Registration?
👉 https://finodha.in/online-gst-registration/
Q12: How should GST returns reflect such transactions?
Answer:
Only taxable supplies should be reported in GSTR-1 and GSTR-3B.
👉 File returns correctly: https://finodha.in/gst-return-filing/
Q13: Does this reduce litigation?
Answer:
Yes. It clarifies scope and avoids unnecessary tax demands.
Q14: How does this affect local authorities like Panchayat?
Answer:
Statutory public functions are excluded from “business” definition under that entry.
Q15: Where can I read official notification?
Answer:
Refer to Gazette Notification No. 17/2018-UT Tax (Rate) dated 26 July 2018
Download PDF: Notification No. 17/2018 – Union Territory Tax (Rate)
More Information: https://taxinformation.cbic.gov.in/
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