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2021 (11) TMI 267 - AAR - GSTExemption from GST or not - services provided to Samaj Kalyan Department, State Government of Maharashtra (Social Welfare Department) for residential accommodation of underprivileged girls - requirement of registration under GST - section 97 (b) of CGST Act, 2017 - Requirement of deduction of TDS u/s 51 - refund entitlement, if TDS is deducted - HELD THAT - The applicant has submitted that the total amount received by her along with Mr. Sagar Borade, co-ownor in the property, per annum is ₹ 31.13 lakhs to be distributed between both of them in the ratio 50 50. Thus, the amount received by the applicant is below the threshold amount above which liability to pay GST accrues. It is seen from the submissions that there is an overlapping of Plot Numbers in respect of five co-owners for example applicant has mentioned that Plot nos. 2 3, belongs to her along with Mr. Sagar Borade. However, it is seen that the said Plot No. 3 belong to other co-owners also. The applicant has not made any detailed submissions stating the actual percentage of the owner/co-owners in the said property. Said submissions made by the applicant is not addressed, in support of being below threshold GST turnover limit due to non-submission of details. Admissibility of entry no. (3) of Notification No. 12/2017-CTR - HELD THAT - Schedule II of the CGST Act, 2017 sets out the activities which are to be treated as supply of goods or supply of service wherein renting of immovable property is treated as supply of service - in the instant case, the supply of leasing of immovable properties by the applicant is a supply of services - Though the applicant as per her submission is supplying Pure Services, in light of insufficient material on record, it is not possible to find whether the said services are supplied by the applicant by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution. The renting of immovable property services by the applicant is not liable for exemption under the provisions of Entry No. (3) Of Notification No. 12/2017-CT(R) dated 28.06.2017. Whether TDS provisions will be applicable in case where the supply of services is exempt? - HELD THAT - The impugned services supplied by the applicant are liable to tax and therefore not exempt. Thus the TDS provisions under the relevant section 51 of the GST Act are applicable in the subject case. As the Applicant is not registered under GST and provide services to Social Welfare Department (Samaj Kalyan Department), a Department of State Government, then whether TDS notification issued under section 51 would be applicable for deduction of TDS? - HELD THAT - TDS notification issued under section 51 would be applicable for deduction of TDS in the subject case. In case TDS is deducted, whether applicant would be entitled for refund of the same? - HELD THAT - The said question pertains to entitlement of refund and is not covered under Section 97 of the CGST Act, 2017 and therefore this question is not answered.
Issues Involved:
1. GST exemption on services provided to the Social Welfare Department for residential accommodation of underprivileged girls. 2. Applicability of TDS provisions on exempt services. 3. Applicability of TDS notification under section 51 for unregistered suppliers providing services to the Social Welfare Department. 4. Entitlement to refund of TDS deducted. Issue-Wise Analysis: 1. GST Exemption on Services Provided to Social Welfare Department: The applicant sought clarification on whether the services provided to the Samaj Kalyan Department, State Government of Maharashtra, for residential accommodation of underprivileged girls are exempt from GST. The applicant contended that the services fall under the provisions of Notification No. 12/2017-C.T. (R) dated 28.06.2017, which exempts pure services provided to the government in relation to functions entrusted under articles 243G and 243W of the Constitution. However, the ruling observed that the applicant did not provide sufficient evidence to demonstrate that the services were in relation to functions entrusted to a Panchayat or Municipality under the specified articles. Therefore, the services were not exempt from GST. 2. Applicability of TDS Provisions on Exempt Services: The applicant questioned whether TDS provisions would apply if the services were exempt. Since the ruling determined that the services were not exempt from GST, it concluded that TDS provisions under section 51 of the GST Act are applicable to the applicant's services. 3. Applicability of TDS Notification Under Section 51 for Unregistered Suppliers: The applicant, being unregistered under GST, sought clarification on the applicability of TDS provisions. The ruling confirmed that TDS notification under section 51 would be applicable for deduction of TDS in the case of the applicant, despite the applicant’s unregistered status. 4. Entitlement to Refund of TDS Deducted: The applicant inquired about entitlement to a refund of TDS if deducted. The ruling refrained from answering this question, stating that it does not fall under the purview of Section 97 of the CGST Act, 2017. Conclusion: The ruling concluded that the services provided by the applicant to the Social Welfare Department are not exempt from GST. Consequently, TDS provisions are applicable, and the TDS notification under section 51 is valid for the applicant. The question regarding the refund of TDS was not addressed.
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