Order Date - 29 September 2023

Facts -

• The Applicant, M/s. NCC URBAN ONE APARTMENT OWNERS MUTUALLY AIDED CO-OP SOCIETY LIMITED (NCCLIOMACS), is a non-profit entity, collects monthly maintenance charges from its members to meet the society's maintenance costs. That the monthly collection charges also include common area electricity charges.
• In addition to the monthly maintenance charges NCCUOMACS presently has some rental incomes from commercial establishments in the society. The applicable GST is collected on the rent and is deposited with the department on a regular basis.

Issue -

• Whether the maintenance charges and common area electricity charges are chargeable to GST?

Order -

• The AAR observed that a combined reading of the Notification No. 02/2017 dated: 28.06.2017 and rule 33 of the CGST rules reveals that the cost of electrical energy supplied by the applicant to its members as a pure agent is not taxable at the hands of the applicant. So by this notification the electrical energy as such remains exempt from taxation and cannot be combined with others supplies being made by the applicant as a composite supply because a composite supply by definition should consist of two or more taxable supplies.
• Notification no. 66/2017 – Central Tax dated 15th November, 2017, specific exemption from the payment of GST on advance receipt has been granted to the supplier of goods. However the time of supply would arise only at the time of issuance of the invoice and the tax liability needs to be discharged only at that time. Thus advances received towards the supply of a service have to be reported in the GSTR-1 / GSTR-3B for the relevant tax period and the liability needs to be discharged in GSTR-3B.
• Further, where the aggregate turnover of a Residents Welfare Association (RWA) exceeds Rs.20 lakhs in a financial year and the amount collected for maintenance per member exceeds Rs.7500/- then the entire amount is chargeable to GST at the rate of 18%. Therefore they are taxable if the total amount collected by the RWA equal or exceeds Rs.7500/-.