Collection of funds by a co-operative society from its members in order to fulfil the objectives and purposes mentioned in bye laws would constitute as to Supply.
Facts: In the instant matter, Apsara Co-operative Housing Society Ltd., the applicant, is a cooperative housing society, and raises funds from its members in order to fulfil the objectives and purposes mentioned in bye laws. Such collections are accompanied with invoices and utilized for purposes mentioned in the bye-laws.
Issue: Whether the said transaction amounted to supply and whether it is liable to GST.
Held: On perusal of the definition of “business” under section 2(17)(e) and of “Consideration” under section 2(31) the applicant is doing business and “society charges” are consideration for the services provided. Thus, the activity is construed to be supply under section 7(1)(a). Further as per clause (c) of SI. 77 of the Notification No. 12/2017-C.T. (Rate), dated 28-6-2017 as amended by the Notification No. 2/2018-C.T. (Rate), dated 25-1-2018 services provided by housing society to its member is exempt, subject to limit to amount of 7500 per month per member.
To conclude the advance ruling under section 97(2)(g) was dismissed stating that the activity conducted by the applicant results into supply, however the taxability of supply will depend upon the amount of society charges collected per person per month (taxable if more than 7500) and the annual turnover (taxable if it exceeds Rs 20lakhs).