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TMI Blog2023 (1) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... el / Guest House / Inn etc.'. The Place of residence, in common understanding is premises rented out / leased out to a person, where that person resides, cooks food, consumes it and 'LIVES'. Generally 'No provision for supply of Food' is existing with reference to a 'Place of Residence'. Therefore, in the instant case, the premises is put into use which is more akin to a 'Hotel / Guest House / Inn etc.' and definitely different from a 'Place of Residence' in common understanding. The exemption on services by way of renting of residential dwelling for use as residence envisaged under the said notification is conditional and restricted only the recipient of the services and NOT beyond. In other words, supply is the fulcrum of GST, the transaction of supply (with regard to appellant) ends with the recipient of services only, in so far as the GST is concerned. Now, from the lease document, it is clearly known that the lessee is not going to use the rented property as 'residence' by himself but only going to sub-lease or rent out to others like students of educational institutions, etc., for their use. Unless the twin condition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n to students 1s liable to GST though the said buildings were used for residence, denying exemption provided under Notification No. 12/2017-CT (Rate) dt:20.06.2017 as amended against the settled legal position. The appellant owns certain residential buildings at Vijayawada and he leased them to certain educational institutions/ societies for the purpose of accommodation of their students. Copies of the lease agreements were submitted. As per the agreements entered with clients, the appellant receives monthly rental amounts from the lessees. The buildings given on rent are constructed with small rooms to suit for accommodation of students. The building which the appellant had given on rent are used only for hostel accommodation by the students for the purposes of residence and the amount collected by the lessees from the students is less than Rs. 1000/- per month. Notification no. 12/2017-CT (Rate) dt:20.06.017 as amended exempts services by way of renting of residential dwelling for use as residence by any person from GST. Relevant entry of the notification is as follows: SI.No Chapter, Section, Heading, Group or service Code (Tarif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Taghar Vasudeva Ambrish Appellate Authority for Advance Ruling dealt with GST exemption granted vide Notification No. 09/2017-IGST (Rate) dt:28.06.2017 and held that hostel is a residential dwelling and since it is used for residence, the assesse is eligible for the exemption notification. The relevant part of the decision is extracted below for ready reference: 15 ... Firstly, the residential dwelling is being rented, as the hostel to the students and working women fall within the purview of residential dwelling as the same is used by the students as well as the working women for the purpose of residence. Secondly, the residential dwelling is used for the purpose of residence. Thus, the aforesaid questions are required to be answered is favour of the petitioner... In the said case of TagharVasudevaAmbrish also, the owner of the building had given leased out the building to a company by name M/s D Twelve Spaces Pvt Ltd who in turn provides accommodation to students and working professionals. The Revenue had taken the same view that is taken in the case of the present appellant that since the lessees himself is not using the accommodation', GST exemption ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sl.No. 18 in the Notification No.25/2012- ST dt:20.06.2012, is wide enough to bring in is ambit the word Hotel as commonly understood. In view of this we do pot see any reason for denying the benefit of the exemption under this entry . Reliance is also placed in the case of the Hon'ble Tribunal decision in the case of Major Kalshi Classes Pvt. Ltd Vs CCE, Allahabad (2020 (2) TMI 759- Cestat Allahabad) It is pertinent to submit that the wordings in the Notification and the negative list are same and further the Hon'ble Court relied on the clarification issued by the Board during service tax regime as held in the case of Torrent Power Ltd Vs Union of India (2019 (1) TMI 1092- Gujarat High Court). Therefore, the Court's order is squarely applicable to the facts of the case. The issue had been dealt with many orders and Advance Ruling Authorities and the Rulings passed by them are cited in the application by the appellant but none of them was discussed by the lower authority in the impugned order. The appellant cites the following decisions in this regard:- a) Advance Ruling Kolkata's order dt.27.06.2019 in the case of Borbeta Estate Pvt Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... remises ), for a monthly rent of Rs.9,99,746/- for the built-up area of the said premises. The Lessor has agreed to allow the Lessee to use and occupy the said premises on lease basis for the purpose of running its students hostel as per the applicable norms and as per the terms and conditions hereinafter contained. In the instant case the Entry under this heading specifically mentions that Residential Dwelling for use as residence is exempted from tax. Residential Dwelling in the context of exemption Notification is indicative of the intention to make the premises as the abode or habitat to live as a normal living person with all amenities of cooking, etc., and not merely to reside in connection with employment or education. On examination of the plan submitted by the Appellant, the property was constructed as hostel building. The Commissioner, Andhra Pradesh Capital Region Development Authority vide Rc.No.C8-2275/2014, dt: 10.03.2015 has given approval for construction of G+4 Building for Hostel in the site of Sri Aluri Krishna Prasad. The approval was given for construction of hostel building. The project description in the sanctioned plan indicates that the plan is for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of Andhra Pradesh. In no way a 'students' hostel' can be equated to a 'residential dwelling' and it is therefore not eligible for exemption under SI.No.12 (Heading 9963) of Notification No.12/2017- Central Tax (Rate) dated 28.06.2017 as amended upto 25.01.2018. The appellant claimed exemption based on Thagar Vasudeva Ambrish Vs Appellate Authority for Advance Ruling (Hon'ble High Court of Karnataka) judgment. In the case of Thagar Vasudeva Ambrish Vs Appellate Authority for Advance Ruling (Hon'ble High Court of Karnataka) judgment, wherein the 5 individuals (Sri T.A. Vasudev, Smt M.C. Nagarathna, Sri T.V. Ambrish, Sri T.V. Nagaraj and Sri T.V. Nagaraj owners of the building have jointly executed a lease deed with M/s D Tweleve Spaces Pvt., Ltd., (referred to as lessee) whereby the Lessors have agreed to lease their portion of the building to the Lessee for the purpose of sub-lease /sub- licence to individuals (including students) for long-term accommodation. The facts in the above said case are different from the instant case. The appellant right from the construction of the building has categorized it as Hostel Building. Further, para 11.8 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r furtherance of business. Further, to corroborate the argument that the premises in question, Hostel in the instant case, is definitely different from a place of residence, enquiries were made and the following are observed. The lessee M/s. Nspira Management Services Private Limited has sub-leased the said premises to M/s. Narayana Educational Society to accommodate their students. Further, the said Narayana Educational Society are running / maintaining a 'MESS' to cater to the needs of their 'inmates' in a building adjacent to the said hostel building. Thus, it is clear that, the sub-lessee i.e. M/s. Narayana Educational Society is providing a 'bundled service' i.e. a bundle of 'Renting of accommodation' and 'supplying food and beverages service' to their 'inmates I students / clients'. In 'Guest House / Hotel / Inn etc.' the same services are provided. This is the basic difference between a 'place of Residence' and a 'Hotel / Guest House / Inn etc.'. The Place of residence, in common understanding is premises rented out / leased out to a person, where that person resides, cooks food, consumes it and &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the judgment passed by The Hon'ble Supreme Court of India in the case of M /s. Rohit Pulp and Paper Mills Ltd. Vs. Collector of Central Excise [1990 (47) ELT - 491 (SC)], as reproduced herewith: in interpreting the scope of any notification, the Court has first to keep in mind the object and purpose of the Notification. All parts of it should be read harmoniously in aid of, and not in derogation of that purpose . Therefore, in order to implement the notification, it is necessary to keep in mind the purpose and the objective of notification. The relevant portion of Notification No.12/2017 CT (R) Dated 28.06.2017 is reproduced herewith: Serial No. Chapter, Section, Heading, Group or Service Code (Tariff) Description of Services Rate (Per. Cent) condition 12 Heading 9963 Or Heading 9972 Services by way of renting of residential dwelling for use as residence NIL NIL From the above, it is clear that the purpose and objective of the notification is nothing but to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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