In re Mody Education Foundation (GST AAR Rajasthan)
In the instant case, we find that the exemption to accommodation service is applicable in respect of a unit of accommodation where tariff is below Rs. 1000/- per day. Notification No. 11/2017-CT(Rate) as discussed above provides applicable GST rate as per declared tariff of a unit of accommodation. Further, accommodation having declared tariff of a unit of accommodation of one thousand rupees and above but less than two thousand five hundred rupees per unit per day or equivalent, the GST rate will be charged 12%, further accommodation having declared tariff of a unit of accommodation of two thousand five hundred rupees and above but less than seven thousand five hundred rupees per unit per day or equivalent, the GST Rate will be charged 18%, further accommodation having declared tariff of a unit of accommodation of seven thousand five hundred rupees & above per unit per day or equivalent, the GST Rate wall be charged 28%. The applicant has stated in their application that they will charge below Rs. 1000/-per student per day, but it has not been declared by the applicant that how many Student will stay in a room, if more than one students wall stay in a room then GST rate will be chargeable, since the applicant did not make clear that how many students wall stay in a room/unit, hence considering non-clarity of tariff of a unit of accommodation, the GST rate as per notification no. 11/2017-Central Tax (Rate), dated 28.06.2017 will be applicable to the applicant.
Further, the applicant is providing service of serving of food to students in hostel. The said service is classifiable under HSN 9963 as provided under notification no. 11/2017-Central Tax (Rate), dated 28.06.2017 and GST rate will be applicable as per the above notification as discussed in para no. 8.
In view of the above, we find that the services supplied by the applicant is a Mixed Supply and highest rate of GST will be applicable amongst services provided by the applicant to students in hostel.
Read AAAR Order:- Unit of Accommodation is ‘Hostel Seat’ not Hostel Room – AAAR
FULL TEXT OF THE ORDER OF AUTHORITY OF ADVANCE RULING, RAJASTHAN
Note: Under Section 100 of the CGST/RGST Act, 2017, an appeal against this ruling lies before the Appellate Authority for Advance Ruling constituted under section 99 of CGST/RGST Act, 2017, within a period of 30 days from the date of service of this order.
At the outset, we would like to make it clear that the provisions of both the CGST Act and the RGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the RGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act / RGST Act would be mentioned as being under the “GST Act”.
The issue raised by M/s Mody Education Foundation, Lakshmangarh, Sikar, Rajasthan (hereinafter the applicant) is fit to pronounce advance ruling as it fans under the ambit of the Section 97(2) (a), (b), (c) & (e) given as under: –
(a) Classification of any goods or services or both;
(b) App ability of a notification issued under the provisions of this act,
(c) Determination of time and value of supply of goods or services or both.
(e) Determination of liability to pay tax on any goods or services or both,
> Further, the applicant being a registered person (GSTIN is 08AABTM0215E1Z5 as per the declaration given by him in Form ARA-01) the issue raised by the applicant is neither pending for proceedings nor proceedings were passed by any authority. Based on the above observations, the applicant is admitted to pronounce advance ruling.
1. SUBMISSION AND INTERPRETATION OF THE APPLICANT:
1. Mody Education Foundation, having its registered office at Kanchanjungha (7th Floor), 18- Barakhambha Road, New Delhi- 110001 (herein after referred as MEF) is Society registered under Societies Registration Act, 1860 with Registration No. S-10560/1986 (date of Registration – 27-02-1986).
2. The Mody Education Foundation was established with following objective-
i. to provide for instruction and training in such branches of learning as it may deem fit.
ii. to provide for research and for the advancement of and dissemination of knowledge.
iii. to undertake extra moral studies, extension programmers and field outreach activities to contribute to the development of society.
iv. to enter into any agreement or arrangement for or to take over, run and maintain one or more schools, college, institutions or centers at any place in India, and to impart and promote education in Arts, Science and Commerce etc.
v. to organize, run, manage, schools, colleges, and institutions.
vi. to establish and manage boarding house, museums, laboratories exhibitions, libraries, lecture-halls, practical classes and other educations facilities.
vii. to grant stipends, scholarship, studentships and other allowances, concessions and gratuities to deserving student and candidates.
viii. to hold examinations and grant certificates of proficiency or other academic distinctions or titles to persons who have complied with the conditions laid down in the regulations of the society.
ix. to acquire by concession, grant, purchase, barter, lease, license, bequest, gift or otherwise either absolutely or conditionally and either alone or jointly with others the agricultural lands, anywhere in India and to earnout all agricultural activities, including Plantation, Afforestation, Agro forestry, Horticulture, raising of crops, growing medicinal and aromatics plants, grass, garden products, dairy farming, breeding of livestock, grazing and all allied activities etc. incidental to agriculture.
x. to establish, create and develop sanctuaries for the protection and development of wild life.
xi. to work and create awareness for protection and development of ecology, environment, soil and water conservation and carry on all activities relating to this
xii. to do all such other acts and things as may be necessary or desirable to further the objects of the society.
3. MEF is running a CBSE affiliated School from class 3rd to 12th at NH-11, Laxmangarh, Distt. Sikar-332311. MEF is registered under GST law having GSTIN 08AABTM0215E1Z5. MEF is also the Sponsoring body of Mody University of Science & Technology.
4. Mody University of Science & Technology (herein after referred as MUST) is a University established u/s 2(f) of the UGC Act, 1956 and providing educational services to its Students (Girls Students Only). MUST is also registered under GST law having GSTIN- 08AAAJM1982F1Z4.
5. MEF has surplus infrastructure facilities after utilization thereof for its activities including running of school. This surplus infrastructure has been let out to MUST for use. The Infrastructure given to MUST for use includes Academic Buildings, certain Hostel Buildings, Office Buildings, Villas, and Dining hall.
6. MEF has been charging Rent from MUST for all above buildings and paying GST @ 18% on the same.
7. MUST is collecting Hostel fees from its students, which includes Lodging and Boarding in the Campus and GST is not charged being exempt under Sr. No. 66 of notification no. 12/2017 CTR Dated 28-06-2017 as amended.
8. University’s Management is considering a proposal to discontinue use of Dining Hall facility and hostel building taken on rent as it is finding it difficult to maintain and operate them. Hence both the facilities shall be returned back to MEF.
9. Other Infrastructure facility such as University Academic Buildings and Villas where the faculties are residing etc. will continue to be used by MUST and It will pay rental charges to MEF and GST @ 18% on the same will be paid accordingly.
10. Hostel facility to the Students of MUST shall be provided by MEF. Hostel Facility shall include Lodging and boarding facility wherein food shall be served in Dining hall.
11. MEF will charge directly from the students for the hostel facilities enjoyed by MUST Students. Charges for Hostel facility comes out less than 1000/- per day. Although charges are collected on yearly basis from the students.
12. MEF is of the opinion that the Hostel facility charges recovered from the students of MUST are not chargeable to GST. The basis of the opinion is exemption notification no. 12/2017 CTR Dated 28-06-2017 as amended time to time. The relevant entry of the exemption notification (Sr. No. 14) is produced below-
Services by a hotel, inn, guest house, club or campsite, by whatever name called, for residential or lodging purposes, having value of supply of a unit of accommodation below or equal to one thousand rupees per day or equivalent.
13. The issue has been clarified by the CBIC through its Circular No. 32/06/2018-GST, dated 12-2-2018. Relevant extract is as under-
