Case Law Details
In re Aluri Krishna Prasad (GST AAAR Andhra Pradesh)
In this case The agreement between the appellant and the lessee is on built up area basis and not on the basis of unit cost of accommodation and hence, it cannot be treated as given for residential dwelling. The appellant is not extending accommodation to the students but to the lessee to whom the building is given on rent is providing accommodation to the students.
AAR ruled that unless the twin conditions of ‘renting of residential dwelling’ for ‘use as residence,’ being inter-twined and inseparable, are not met, the exemption is not available. As per settled law, in taxation laws, especially when exemptions or concessions or benefits are to be availed, the interpretation is to be literally and strictly construed and not in liberal terms.
If there is a conditional exemption in GST based on end-use, the end-use has to be determined with respect to facts and for the recipient of the services only from the supplier directly and it is not for the department to see how the services are finally put to use by the recipient in turn and so on. In the instant case there is no evidence to show that either the building was a residential dwelling or it is going to be put to use as residence for himself by the lessee as discussed in detail above. The lower authority has considered all the facts and details of the case and examined them in the light of the relevant provisions of the APGST Act and Rules 2017 along with relevant notifications while deciding the case.
In the instant case, it is evident from the above reading, that the property under question is not a home or residence being used by a family or group of a members maintaining a regular house hold, but used for commercial purposes of accommodating students in bulk numbers. A temporary stay of the students will not merely qualify the purpose “for use as residence” and hence it is not qualified to be listed under heading 9963 or 9972.
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