2019 (7) TMI 1106 - AAR - GST

Maintainability of Advance Ruling application - Levy of GST - Individuals who own flat/s in a society but have opted not to become the member of the society - eligibility for GST exemption of ₹ 7500/- - whether members of the society will be at par with the other individual flat owners who are not members. HELD THAT - Section 97(2), which encompasses the questions, for the ruling by the AAR does not cover the question raised by the applicant. It is therefore felt that this authority does not have jurisdiction to pass any ruling on such matters/questions. The impugned application is not maintainable - No proceeding of Advance Ruling under the GST Act lies in the instant case

Summary

Issues:
Individuals owning flats in a society but not becoming society members - GST exemption eligibility.

Analysis:
1. Facts and Contention - As per the Applicant:
The applicant sought an advance ruling on whether individuals owning flats in a society but not becoming society members would be treated as outsiders for GST liability or be eligible for GST exemption of ?7500. The applicant argued that only society members are eligible for the exemption as per Notification no. 11/2017-State Tax (Rate). They highlighted that co-op societies fall under GST based on the definition of "Person" and "Business" under the GST Act. The applicant emphasized that non-members are not entitled to the basic exemption of ?7500 and must pay GST without exemption.

2. Contention - As per the Concerned Officer:
The officer classified flat owners as members or non-members of the society. Referring to the Maharashtra GST Act and relevant notifications, it was argued that only members are exempted from GST. Non-members, receiving services from the society, were deemed liable for GST. The officer relied on the definition of a member under the Maharashtra Co-operative Societies Act to support the distinction between members and non-members for GST applicability.

3. Observations:
After reviewing submissions, the authority noted that the society provided both taxable and exempted services to its members. They acknowledged the applicant's understanding of GST laws and the applicable notifications. However, the authority pointed out that the question raised did not fall under the categories specified in Section 97(2) of the CGST Act, which outlines the scope of advance rulings. Therefore, the authority concluded that they lacked jurisdiction to rule on the matter as it did not pertain to the specified areas for advance rulings under the GST Act.

4. Order:
The authority rejected the application for advance ruling, deeming it non-maintainable due to the question falling outside the scope of issues eligible for advance rulings under the GST Act. The ruling emphasized that the authority did not have jurisdiction to provide a ruling on the eligibility of individuals owning flats in a society but not becoming members for GST exemption.