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2019 (8) TMI 819 - AAR - GSTNature of activity - supply or not - classification of supply - supply of goods or supply of services - contributions from the members in the Administration Account, 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 - Principles of Mutuality - taxable person or not - person responsible under GST, as office bearers - collection of funds under common pool and spending back on the same said contributors, whether supply or not. HELD THAT:- As per the definition of "person" under the GST Act, 2017, there are two persons namely, the applicant and the other person being the "member" of the applicant. Hence the club/organization and member are distinct entities. The GST law has given very wide connotation for services, which will cover any activity other than which involves goods, money and securities. Therefore the activity of the applicant in as much as they are striving to set high ethical standards in business and profession, recognition of worthiness of all useful occupations, dignifying each Rotarian's occupation as an opportunity to serve society, application of the ideal of service in each Rotarian's personal, business and community life, exclusively for their members can clearly be considered as service being provided by the respondents to its members. From the inclusive definition of the term 'consideration' it can decisively be construed that the membership fee collected by the club from members is not only meant for meeting administrative expenses, but is also towards setting high ethical standards in business and profession, recognition of worthiness of all useful occupations, dignifying each Rotarian's occupation as an opportunity to serve society, application of the ideal of service in each Rotarian's personal, business and community life, exclusively for their members. Thus, any membership fee collected by the applicant from its members will definitely be understood as 'consideration' as the same has been paid for supply of services”. Applicant has fulfilled both the conditions prescribed by Section 7 of the CGST Act; firstly that such supply is made by them in lieu of consideration and secondly, such supply has been made in the course or furtherance of business since the term business includes provision by club, association, society, or any such body (for a subscription or any other consideration) of the facilities or benefits to its members - both the conditions stipulated for 'supply' under the GST Laws having been adequately fulfilled leads to the conclusion that transaction between the applicant & its members are nothing but supply, and accordingly will attract GST. Under the GST Law, the intent or objective of any club or association is immaterial in so far as the leviability of GST is concerned. The amount collected as membership subscription and admission fees from members is liable to GST as supply of services.
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