Chennai: Pointing out that leases appeal to GST provided that the rented constructing is used for industrial functions, Madras excessive courtroom has quashed GST demand on hostels for working women and women.
Justice Krishnan Ramaswamy, setting apart the GST demand discover, mentioned: “While adverting to the imposition of GST on hostel accommodation, it has to be looked into as to whether the inmates of the hostel rooms are using the premises as their residential dwelling or commercial purpose since renting of residential unit attracts GST only when it is rented for commercial purpose.” Since the end-use of the property is for residential functions, it might not appeal to GST, he dominated.
“So, in order to claim exemption of GST, the nature of the end-use should be residential and it cannot be decided by the nature of the property or the nature of the business of the service provider, but by the purpose for which it is used,” Justice Krishnan Ramaswamy added.
Therefore, this courtroom is of the thought of view that the difficulty of levy of GST on residential lodging must be considered from the attitude of the recipient of service and not from the attitude of service supplier, who gives the premises on rental foundation, the choose mentioned.
The courtroom handed the order whereas permitting a batch of pleas moved by managements of personal hostels for working women and women difficult an order handed by TN State Appellate Authority for Advance Ruling dated Aug 31, 2023, imposing 18% GST on such hostels. “In the present case, the imposition of GST on the hostel accommodation should be viewed from the perspective of the recipient of service and not from the perspective of service provider,” the courtroom mentioned.
Justice Krishnan Ramaswamy, setting apart the GST demand discover, mentioned: “While adverting to the imposition of GST on hostel accommodation, it has to be looked into as to whether the inmates of the hostel rooms are using the premises as their residential dwelling or commercial purpose since renting of residential unit attracts GST only when it is rented for commercial purpose.” Since the end-use of the property is for residential functions, it might not appeal to GST, he dominated.
“So, in order to claim exemption of GST, the nature of the end-use should be residential and it cannot be decided by the nature of the property or the nature of the business of the service provider, but by the purpose for which it is used,” Justice Krishnan Ramaswamy added.
Therefore, this courtroom is of the thought of view that the difficulty of levy of GST on residential lodging must be considered from the attitude of the recipient of service and not from the attitude of service supplier, who gives the premises on rental foundation, the choose mentioned.
The courtroom handed the order whereas permitting a batch of pleas moved by managements of personal hostels for working women and women difficult an order handed by TN State Appellate Authority for Advance Ruling dated Aug 31, 2023, imposing 18% GST on such hostels. “In the present case, the imposition of GST on the hostel accommodation should be viewed from the perspective of the recipient of service and not from the perspective of service provider,” the courtroom mentioned.
