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2021 (12) TMI 608 - AAR - GSTNature of activity - business or not - activity of the applicant i.e. collecting contributions and spending towards meeting and administrative expenditures only - contributions from the members, recovered for expending the same for the weekly and other meetings and other petty administrative expenses incurred including the expenses for the location and light refreshments - supply or not - doctrine of mutuality - HELD THAT:- In view of the amended Section 7 of the CGST Act, 2017, we find that the applicant society and its members are distinct persons and the contribution received by the applicant, from its members is nothing but consideration received for supply of goods/services as a separate entity. The principles of mutuality, which has been cited by the applicant to support its contention that GST is not leviable on the contribution collected from its members, is not applicable in view of the amended Section 7 of the CGST Act, 2017 and therefore, the applicant has to pay GST on the said amounts received from its members. According to applicant, there is no commercial consideration involved in the process, just that the funds are collected in a common pool for meeting the expenses for the weekly meetings and other petty expenses incurred in meeting the common objective of betterment of society. According to applicant, the amount being collected from the members is reimbursement of expenses or share of contribution - The common pool is being spent back on the members only. According to applicant, in the absence of two distinct persons and also in absence of consideration, as defined under the Act, contributions received from the members in the Administration Account does not qualify as a Supply within the meaning of the term, as defined under the Act. The amendment to Section 7 (mentioned above) clearly treats the applicant and its member as two different persons where there is a supply of services from the applicant to its members and thus as per the applicant’s own submission that two different persons have been envisaged in the law to tax a transaction as a supply made for a consideration, in the instant case there is a supply by the applicant to its members and consideration is received in the form of “fees”.
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