GST Exemption for Bio-mining Services to Governmental Authorities
Bio-mining and waste remediation services provided to a Governmental Authority are exempt from GST under Notification No. 12/2017.
- Ruling
- Advance Ruling No. 19/ARA/2026, dated 04.03.2026
- Dated
- 04 Mar 2026
- Authority
- Authority for Advance Ruling
This page was written by Patron Accounting’s AI from the official release and reviewed before publishing. It explains the document in plain language. It is not the document itself. Where this page and the original differ, the original governs.
The short version
- Gorantla Geosynthetics Ltd. asked if bio-mining services are GST exempt.
- The authority ruled these are 'pure services' for a Governmental Authority.
- Services related to municipal solid waste management qualify for the exemption.
In short
The company asked the Authority for Advance Ruling (AAR) whether its waste remediation work for the Goa Waste Management Corporation qualifies for a GST exemption. The core issue was whether these bio-mining activities count as 'pure services' provided to a Governmental Authority under Notification No. 12/2017.
What has changed
How it worked before
Businesses were often uncertain if specialized waste management contracts involving machinery and labor qualified as 'pure services' or if they were taxable as works contracts.
What has changed
The authority confirmed that bio-mining and legacy waste disposal are exempt from GST when performed for a Governmental Authority. This means contractors in this sector do not need to charge GST on these specific municipal projects, provided they meet the criteria of supplying pure services.
Who this affects
Waste management contractors and environmental service providers working for state-run municipal corporations.
An example
A private firm in Karnataka wins a contract to clear a landfill for a local municipal body. They wonder if they should charge 18% GST on their invoices. Based on this ruling, if their work is purely service-based and the client is a Governmental Authority, they may be eligible for the same exemption.
What you should do
If you perform similar work, review your contract to ensure it qualifies as a 'pure service' and verify that your client meets the definition of a Governmental Authority. Remember, an advance ruling only binds the company that asked and its specific tax officer; it is not a universal law for all businesses.
If you do nothing
If you assume this ruling applies to you and stop charging GST without a formal assessment, you risk a tax demand, interest, and penalties if your local officer disagrees. An advance ruling is not a blanket exemption for the entire industry. Always consult your tax advisor to confirm your specific contract qualifies before changing your billing practices.
The terms explained
- Bio-mining
- A scientific process used to excavate and treat legacy waste from dump sites to recover materials like fuel and compost.
- Pure services
- Services provided without the supply of any goods or materials by the service provider.
- Governmental Authority
- An authority, board, or body set up by an Act of Parliament or State Legislature to carry out specific functions.
The ruling in detail
Authority for Advance Ruling
M/s. GORANTLA GEOSYNTHETICS LTD.
Advance Ruling No. 19/ARA/2026, dated 04.03.2026 · Tamil Nadu
Questions before the authority
- Classification of the services provided by the applicant
- Whether services provided by the applicant are exempted under Sl.No.3 of Notification No.12/2017 dated 28.06.2017 as amended?
- Whether the service recipient, i.e., M/s. Goa Waste Management Corporation is a "Governmental Authority" as per the definition of Notification No.12/2017, Central Tax, dated 28.06.2017.
Facts
The applicant is a service provider engaged in the remediation of waste dump sites through bio-mining processes for the Goa Waste Management Corporation. The work involves the excavation, screening, and scientific disposal of legacy waste, including the segregation of materials into Refuse Derived Fuel, compost, and inert fractions. The applicant sought an advance ruling to determine the classification and taxability of these services.
Ruling
| Question | What the authority ruled |
|---|---|
| Classification of services | SAC 9994, attracting GST at 18% (9% CGST + 9% SGST, or 18% IGST) Covers remediation of waste dump sites |
| Exemption under Sl. No. 3 of Notification No. 12/2017 | Exempted As pure services provided to a Governmental Authority |
| Status of service recipient | Not covered under Section 97(2) Authority refrained from giving a ruling |
The authority ruled that the services provided by the applicant are classified under SAC 9994 and are subject to 18% GST. However, it further held that these services are exempt from GST under Sl. No. 3 of Notification No. 12/2017-Central Tax (Rate) as they constitute pure services provided to a Governmental Authority in relation to functions entrusted to a municipality. The authority declined to rule on the third question regarding the status of the service recipient, stating it was not a matter for which an advance ruling could be sought.
Reasoning
The authority determined that the applicant's activities constitute 'pure services' as there is no supply of goods involved. It found that the Goa Waste Management Corporation qualifies as a 'Governmental Authority' under the relevant notification because it was established by an Act of the State Legislature. Furthermore, the services provided fall under the functions entrusted to a municipality under the 12th Schedule to Article 243W of the Constitution, specifically relating to public health and solid waste management. Consequently, the services satisfy the conditions for exemption under **Sl. No. 3 of Notification No. 12/2017**.
Provisions relied on
- Section 97(2)(a) of the CGST Act, 2017
- Section 97(2)(b) of the CGST Act, 2017
- Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017
- Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017
- Article 243W of the Constitution of India
For the practitioner
This ruling confirms that bio-mining and remediation services provided to a Governmental Authority qualify for **GST exemption** as pure services under Notification No. 12/2017. It provides a useful precedent for contractors engaged in municipal solid waste management projects. Practitioners should note that the authority will not entertain questions regarding the status of a third-party service recipient if that question is not directly related to the applicant's own tax liability.
Source
This is a summary prepared from the published order, which is a scanned document. It is a reading aid and not the authority: where the two differ, the order governs. Verify every provision against the original before relying on it.
Original order: https://www.gstcouncil.gov.in/sites/default/files/AAR/4-gorantla_goa_aar_order.pdf
Legibility of the scan, as read: high.
Prepared 12-10-2026.
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