TMI BlogLevy of service tax on services provided by a Resident Welfare Association (RWA) to its own members – regarding.X X X X Extracts X X X X X X X X Extracts X X X X ..... on services provided by a Resident Welfare Association (RWA) to its own members regarding. Service tax on club or association service which covers Resident Welfare Association (RWA) was introduced with effect from 16.06.2005, vide section 65(105)(zzze) read with section 65(25a) [(25a) was later renumbered as (25aa)]. Under the positive list approach which was followed prior to 1st July 2012, exemption was available under notification No. 8/2007-ST dated 01.03.2007, if the total consideration received from an individual member by the RWA for the services does not exceed three thousand rupees per month. This notification was rescinded vide notification No. 34/2012-ST dated 20th June 2012, with effect from 1st July, 2012. 2. U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s RWAs, to its own members. However, a monetary ceiling has been prescribed for this exemption, calculated in the form of five thousand rupees per month per member contribution to the RWA, for sourcing of goods or services from third person for the common use of its members. If per month per member contribution of any or some members of a RWA exceeds five thousand rupees, the entire contribution of such members whose per month contribution exceeds five thousand rupees would be ineligible for the exemption under the said notification. Service tax would then be leviable on the aggregate amount of monthly contribution of such members. 2. (i) Is threshold exemption under notification No. 33/2012-ST available to RWA? ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on or a consideration by any other name, the RWA is acting as a pure agent and hence exclusion from the value of taxable service would be available. However, in the case of electricity bills issued in the name of RWA, in respect of electricity consumed for common use of lifts, motor pumps for water supply, lights in common area, etc., since there is no agent involved in these transactions, the exclusion from the value of taxable service would not be available. 4. Is CENVAT credit available to RWA for payment of service tax? RWA may avail cenvat credit and use the same for payment of service tax, in accordance with the Cenvat Credit Rules. 3. Trade Notice/ Public Notice to be issued. Hindi version to f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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