In re Close North Apartment Owner’s Association (GST AAR Haryana)
Question 1. Whether GST is applicable on the Common Area Electricity charges collected, on actual basis, by the Applicant from the residents of the apartment complex, or not?
Yes at the rate of 18% (SGST 9%+CGST 9%)
Question 2. Whether GST is applicable on the Common Area Electricity charges collected, with a margin, by the Applicant from the residents of the apartment complex, or not?
Yes
Question 3. What should he the basis of allocation of Common Area Electricity Charges to the units in the apartment complex?
Not Applicable. Question asked by the applicant is not covered under section 97(2) of the CGST/HGST Act, 2017 as amended.
FULL TEXT OF THE ORDER OF AUTHORITY FOR ADVANCE RULING, HARYANA
1. APPLICANT’S ELIGIBILITY FOR SEEKING AN ADVANCE RULING:
1.1 To file an application before the Authority of Advance Ruling, the applicant must satisfy the conditions prescribed under the Central Goods and Services Tax Act, 2017 (hereinafter referred to as CGST Act, 2017) and Haryana Goods and Services Tax Act, 2017 (hereinafter referred to as HGST Act, 2017). Since the provisions of both the Acts arc parimateria, any reference to provisions of CGS’I’ Act, 2017 in this order should be construed as a reference to corresponding provisions in CGST Act, 2017 as well.
1.2 Sections 97(2) (a)(h)& (c) read with Section 95 of the CGST Act, 2017 prescribes that Advance Ruling may be sought inter alia on the question of (a) Classification of goods and/or services or both. (b) Applicability of a notification issue under the provisions of this Act. (e) Determination of the liability to pay tax on any goods or services or both. (g) Whether particular thing done by the applicant with respect to any goods and or services or both amounts to or results in a supply of goods and/or services or both, within the meaning of that term.
1.3 There is no bar on an applicant from seeking an Advance Ruling in terms of Section 98(2) of CGST Act, 2017 in as much as the questions raised by the applicant, the same are neither pending nor decided in any proceedings in the ease of the applicant under the proceedings in
electricity within the WIN shall 1w owned and managed by the GIIS/ Developer/ RWA.”
2.5 The Electricity Regulations, 2013 have been amended to Single Point Supply to Employers’ Colonies Group Housing Societies, Residential Colonies, Office cum Residential complexes and Commercial Complexes of Developers, and Industrial Estates/IT park/SEZ Regulations, 2020 (“hereinafter referred to as the Electricity Regulations, 2020) vide notification dated 22 April 2020 issued by the Haryana Electricity Regulatory Commission. The relevant extract has been reproduced hereunder for easy reference:
“4. Supply of electricity by the distribution licensee to the Group Housing Societies (G IISs)
4.2 the distribution licensee, on an application from the GUS, as per clause (a) shall give Single point Supply to the GUS at 11 kV or higher voltage, depending upon the feasibility, for making electricity available to the residents/members residing in the Colony and for common services/ non-domestic loads. Provided the distribution of electricity within the GHS shall be owned and managed by the GHS.”
He has also referred to the para 6.6 of the EA, 2020 which is as following:-
“a) The Employer/GHS/Users Associations will not charge the Residents/Individual Consumer Common Services and other category loads in the Colony/GHS/ Complex for electricity supplied, at a rate higher than the tariff for Domestic Supply (DS)/other relevant category, approved by the Commission from time to time.”
2.6 The applicant stated that electricity supplied by the State Electricity Board and there is a Single Point 13ulk connection or a common electricity meter for the entire complex which is in the name of the Applicant. The Applicant has, in turn, installed the sub-meters in the premises of the individual flat owners for measuring the electricity consumption of each such unit and also a separate sub-meter is installed for units consumed towards common area electricity. This is done because the distribution of electricity within the apartment complex is to be owned and managed by the Applicant as required under para 4.1.2 of the Electricity Regulations 2013 and subsequently para 4.2 of the Electricity Regulations 2020.
2.7 The electricity bill issued by the State Electricity Board is received in the name of the Applicant. Thereafter, the Applicant raises invoice/ bills in the name of individual flat owners based on the electricity consumed by the individual unit under the following heads:
