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2019 (7) TMI 1281 - AAR - GSTLevy of GST - consideration paid as subscription or contribution towards recurring or capital expenses or reimbursement to National Institute of Bank Management (NIBM) - Whether consideration paid as subscription or contribution towards recurring or capital expenses or reimbursement or by whatever name called to National Institute of Bank Management (NIBM); a society registered under Societies Registration Act, 1860 by its members (being Banks) for its recurring and non-recurring expenses is leviable to GST? HELD THAT:- In the subject case, the applicant receives certain amount of contribution from public sector banks and RBI to cover certain recurring and non-recurring expenses incurred by them. As per Memorandum of Association, the expenses are incurred for promotion and conducting of research in matters pertaining to the improvement of banking operations, pertaining to the maximum augmentation and effective deployment of banks’ resources including analytical and perspective studies of various sectors of the economy with a view to promoting national development, to assist banking and financial institutions in matters such as designing measurement tests for employee selection, appraisal programs, conducting morale, productivity studies, streamlining organizational structure and to review, from time to time, the impact of educational, training and research activities and offer suggestions for filling the gaps in the banking and financial systems and to maintain liaison with banking and financial institutions. There is a supply of taxable services by the applicant which are performed for consideration (in this case contributions received for performing activities mentioned in the MOA) received in furtherance of their business. As per Section 2 (17) (e) ‘business’ includes provision by a club, association, society, or any such body (for a subscription or any other consideration) of the facilities or benefits to its members. Here, the applicant is a society formed by the RBI and various Public Sector Bank/s and are providing services mentioned in para 5.6 above to their member banks. Therefore it can safely be said that they are receiving consideration (contribution) for supply of taxable services rendered in furtherance of their business. Principal of Mutuality - HELD THAT:- We do not agree with the applicant’s contention that their activity would be covered under the ‘Principal of Mutuality’ i.e. “No man can trade with himself; he cannot make, in what is its true sense or meaning, taxable profit by dealing with himself’. This assumption is made by the applicant considering that they and the various Public Sector banks and RBI are one and the same - we are firmly of the opinion that the contributions received by the applicant from the RBI and other Public Sector Banks is nothing but consideration for the entire gamut of services supplied by them as mentioned in para 5.6 supra and GST is payable on such contributions received.
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