GST Series-1

GST Series-1

Happy GST Series-1 Whether Services provided by housing society amount to supply under GST?

Apsara Co-operative Housing Society Limited (GST AAR Maharashtra) GST-ARA- 21/2019-20/B-34 Mumbai, dt. 17/03/2020 In the above stated Advance ruling two question were asked:

Question 1):- Whether the activities carried out by the applicant for its members qualify as “supply” under the definition of Section 7 of the CGST Act, 2017.

Reply: 1. The activities of Applicant i.e. obtaining conveyance from the promoter (Builder), managing, maintaining and administering the property of the society, raising fund for achieving the objects of the society, undertaking and providing any social, cultural or recreation activities can clearly be considered as rendering of “supply” of service being provided to its members. 2. Term Supply is inclusive definition and not an exhaustive one and therefore it has very wide connotations.

3. The word “person” mentioned in Section 7 (1) (a) is defined in Section 2(84)

(i) of the CGST Act, 2017 and amongst others, specifically includes ‘a co-operative society registered under any law relating to co-operative societies’

4. Further the term “consideration” as per Section 2(31) of the CGST Act, 2017, it can be construed that membership fees collected by the Applicant from its members is also meant for meeting expenses for activities undertaken by the applicant to achieve the various objects of the society as mentioned in By-laws of the Society. Thus, membership fee collected by Applicant from its members will be treated as “consideration” paid for supply of services. 5.

As per Section 2(17) (e), the activities undertaken by applicant would come under the scope of business.

6. Thus it is supply and liable to GST. Further non applicability of the provision on grounds of “principle of mutuality” was not tenable in law. Various judgment as quoted was not found relevant. The first Question was answered in affirmative

Question 2):- If the activities of the applicant are treated as “supply” under CGST Act, 2017 then whether the applicant has correctly discharged the GST as per the illustrative copy of the invoice generated by the Applicant?

Reply: This question was not answered. As the same was not a matter for obtaining advance ruling under Section 97(2) of the CGST Act, 2017 Our Comment: Advance ruling cannot be obtained on invoicing. Applicant wanted to check the authencity of the documents issued by him which was not covered in Sec. 97(2).

 

BY: Admin Tax4wealth

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