The Haryana Authority for Advance Ruing (AAR), ruled that GST is leviable on welfare activities done by Residents Society for its resident members. The applicant in the present matter is M/s Valley Residents Welfare Society, which is a welfare society.
Section 9 of Haryana Goods & Services Tax Act, 2017 provides for levy of GST on supply of Goods & Services. In view of Section 2 (84), Person includes both individual & Co-operative society under the GST law. Broadly seen the services provided by the society to its members seem taxable under the GST law unless these are specifically exempt.
The RWA has employed workers for the services to be provided to its members. Under the GST law services by employees to its employer has been specifically kept outside the levy of GST (entry I to the schedule iii).
However, the RWA is paying GST on the services being obtained from the Third Person with reference to the security services. The RWA is getting Services from Nova Security Pvt Ltd. The Society has been paying GST on the amount disbursed to this Company for Security Services.
The applicant has sought advance ruling in the matter of whether the welfare activities done by the society for its resident members fall within the ambit of Goods & Services Tax Act, 2017?
Monthly contribution collected from the members by the society is used for the purpose of making payments to the third parties in respect of commonly use services or goods which includes facilities like lift, water pump, health and fitness centre, swimming pool, payment of electricity bill for common area, maintenance of parking spaces, maintenance of parks, disposal of garbage and cleanliness etc.
The Coram comprising of Sunder Lal, Member CGST and Kumud Singh, Member SGST observed that “GST can be levied on welfare activities done by Residents Society for its resident members.”
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