Case Law Details
In re Prinsep Association Of Apartment Owners (GST AAR West Bengal)
The order of the Authority for Advance Ruling (AAR) in the case of Prinsep Association of Apartment Owners in West Bengal addresses three key questions related to Goods and Services Tax (GST) implications on the maintenance charges and other collections by an Association of Persons (AOP) registered under the West Bengal Act XVI of 1972:
Question 1: Where monthly contribution charged to a member exceeds INR 7500 per month, whether the applicant can avail the benefit of Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017 (Sl. No. 77) read with Notification No. 02/2018 dated 25.01.2018, which provides for exempting from tax, the value of supply up to an amount of Rs. 7,500/- per month per member? In other words, whether tax would be charged over and above INR 7500 or the total amount collected from members.
Answer: The AAR ruled that the exemption is not available when the maintenance charges exceed Rs. 7,500/- per month per member. In such cases, where the charges exceed Rs. 7500/- per month per member, the entire amount is taxable.
Question 2: Whether the applicant is liable to pay CGST/SGST on amounts which it collects from its members for setting up a corpus fund for future contingencies/ major CAPEX. Whether such fund from members will come under the definition of supply and liable to be taxed?
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