The Government of West Bengal on July 08, 2024, issued Clarification on the time of supply with respect to the supply of services of construction of road and maintenance thereof of National Highway Projects of National Highways Authority of India (NHAI)in Hybrid Annuity Mode (HAM) model.
The following has been stated: -
•It is clarified that the tax liability on the concessionaire under the HAM contract, including on the construction portion, would arise at the time of issuance of invoice, or receipt of payments, whichever is earlier, if the invoice is issued on or before the specified date or the date of completion of the event specified in the contract, as applicable. Suppose invoices are not issued on or before the specified date or the date of completion of the event specified in the contract. In that case, tax liability will arise on the date of provision of the said service (i.e., the due date of payment as per the contract), or the date of receipt of the payment, whichever is earlier.
•It is also clarified that as the installments/annuity payable by NHAI to the concessionaire also includes some interest component, the amount of such interest shall also be includible in the taxable value for payment of tax on the annuity/installment given the provisions of section 15(2)(d) of the WBGST Act.
[Trade Circular No.15/2024]
