2021 (3) TMI 577 - AAR - GST

Maintainability of Advance ruling application - application not filed in proper format - Levy of GST - Supply of services or not - amount collected as membership subscription and admission fees from members - levy of GST on transactions between the Applicant and its members, on account of Principles of mutuality - classification of goods - rate of tax - input tax credit on on Catering services for holding members meetings and various events - HELD THAT - On a combined reading of the provisions of the Section 97 and Rule 104 of both the aforementioned Acts and Rules, we find that the application for obtaining an Advance Ruling under sub-section (1) of Section 97 is to be submitted in FORM-GST ARA-01 and shall be accompanied by a fee of Ten thousand rupees (Five thousand rupees as per Rule 104 of the CGST Rules, 2017 Five thousand rupees as per Rule 104 of the GGST Rules, 2017). Although the applicant has filed the application in the prescribed format of GST-ARA-01, they have not paid the required fees of ₹ 10,000/- as required under the provisions of aforementioned Sections and Rules. Therefore, the instant application is liable for rejection under Section 98(2) of the CGST Act, 2017 for not paying the total fees of ₹ 10,000/- i.e. ₹ 5,000/- under each head CGST GGST as required under the provisions of CGST Act and Rules and respective GGST Act Rules. Instant application filed by M/s. The maharaja Pratapsinh Coronation Gymkhana (Trade Name Polo Club), Vadodara is hereby rejected under Section 98(2) of the CGST/GGST Act, 2017 being non-maintainable.

Summary

Issues:
1. Liability of GST on membership subscription and admission fees
2. Applicability of GST on transactions between the club and its members
3. SAC code and services description for taxable activities
4. Input Tax Credit eligibility for catering services
5. Exemption eligibility for the club

Analysis:
1. The applicant, a registered Association of Persons, sought an advance ruling on the GST liability of membership subscription and admission fees collected from members. The club argued that these fees were for covering day-to-day expenses and not for providing additional goods or services. They contended that no GST should be charged on these fees.

2. The club also raised the issue of the applicability of GST on transactions between the club and its members based on the principle of mutuality. Citing the case of State v/s. Calcutta Club Ltd., they argued that no GST should be levied on transactions between a members club and its members.

3. The club inquired about the relevant SAC code and services description for taxable activities if GST was applicable to their transactions. They sought clarity on the specific classification for their services under the GST regime.

4. Additionally, the club questioned the eligibility to claim Input Tax Credit on the tax paid for catering services used for holding member meetings and events. They sought clarification on the extent of input tax credit they could claim.

5. Finally, the club sought clarification on their eligibility for exemption from GST if their activities were deemed non-taxable. They inquired about the criteria for exemption under the GST laws.

The Authority for Advance Ruling noted that the applicant failed to pay the total prescribed fee of ?10,000 as required by the relevant provisions of the CGST Act, 2017 and the GGST Act, 2017. As per Section 98(2) of the CGST Act, 2017, the application was liable for rejection due to non-compliance with the fee payment requirement.

In conclusion, the application by the club for an advance ruling was rejected under Section 98(2) of the CGST/GGST Act, 2017 for being non-maintainable. The ruling was based on the club's failure to fulfill the statutory fee payment obligations, rendering their application invalid for an advance ruling.