9911796707
TMI Blog2021 (3) TMI 895X X X X Extracts X X X X X X X X Extracts X X X X ..... 1ZE, have filed an application for Advance Ruling under Section 97 of CGST Act, 2017 & KGST Act, 2017 read with Rule 104 of CGST Rules 2017 & KGST Rules 2017, in form GST ARA-01 discharging the fee of Rs. 5,000/- each under the CGST Act and the KGST Act. 2. The Applicant is a non-profit making residents welfare Association formed by individual apartment/flat owners for the purpose of maintaining and managing the common areas and facilities in the condominium and the Applicant is duly registered under the provisions of the Karnataka Apartment Ownership Act, 1972 ('KAOA Act'). The applicant is also registered under GST Act. The applicant submits that in addition to the regular maintenance, they also required to undertake periodic up-keep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ties in accordance with its registered Bye-laws and also as per the KAOA Act. 4.2 The Applicant, having about 208 members, is engaged in providing maintenance and repairs of common areas such as the corridors, garden, play area, pathway, clubhouse, swimming pool, gymnasium, electric equipment etc., and payment of electricity and other outgoings by collecting monthly maintenance charges from its members based on the area of occupancy. 4.3 The applicant also collects certain amounts towards sinking fund, in addition to regular maintenance amounts, to meet the expenditure of planned / unplanned outlay in future, under its bye-laws. 5. Applicant's Interpretation of Law: 5.1 The Applicant submitted that they perform the duties in accorda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... received by the Applicant Association is in the nature of deposit for future planned/unplanned event and not for the purpose of supplying any goods or services in discharge of any contractual obligation. Hence, the amount received by the Applicant for setting up Sinking Fund would not be liable to tax under the Act. PERSONAL HEARING PROCEEDINGS HELD ON 28/01/2021 6. Sri K.S.Harish, Vice President, Advocate & Authorized Representative of the applicant appeared for personal hearing proceedings held on 28/01/2021 and reiterated the facts narrated in their application. FINDINGS & DISCUSSION 7. We have considered the submissions made by the applicant in their application for advance ruling. We also considered the issues involved, on which a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ided by them. In this regard we invite reference to Section 2(31) of the CGST Act, 2017, which defines the term "consideration" and the same is as under: "(31) consideration in relation to the supply of goods or services or both includes- (a) any payment made or to be made, whether in money or otherwise, in respect of, in response to, or for the inducement of, the supply of goods or services or both, whether by the recipient or by any other person but shall not include any subsidy given by the Central Government or a State Government; (b) the monetary value of any act or forbearance, in respect of, in response to, or for the inducement of, the supply of goods or services or both, whether by the recipient or by any other person but sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scribed under Section 31 of the CGST Act 2017 or the receipt of payment, whichever is earlier. In the instant case the applicant receives the payment earlier and hence the time of supply is the date of receipt of amount towards the sinking fund. Therefore the said amounts are liable to GST as they are advances towards future supply of services but not the deposits. 13. Now we proceed to decide the classification of the service to be provided by the applicant as the taxability of the amounts collected towards sinking fund has already been decided at para 12 supra. SAC 9995 covers the services provided / to be provided by the applicant to its members under "Services of Membership Association". The said services are taxable to GST @ 18% in te ..... X X X X Extracts X X X X X X X X Extracts X X X X
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