The society has been allowed to deposit tax only on the amount in excess of ₹7,500 per month per flat

Madras HC stays GST ruling on flat maintenance charges

The society has been allowed to deposit tax only on the amount in excess of Rs 7,500 per month per flat

TVH Lumbini Square Owners Assn. had appealed AAR order

The Madras High Court has stayed an order of the Tamil Nadu Authority for Advance Ruling (AAR) that 18% GST is applicable on the entire amount of the maintenance charges collected from residential welfare association if they exceed Rs 7,500 per month per flat.

In July, AAR had passed an order in respnse to a clarification sought by TVH Lumbini Square Owners Association, Purasawalkam.

The association said it was registered under the Societies Act and Goods and Services Tax Act. The society consists of 9 residential blocks and there are 448 flats, it said.

Post the AAR ruling, the Finance Ministry also clarified that the GST would be applicable on the entire maintenance amount if it exceeds ₹7,500 per month per person and only if the turnover of such residential association exceeds Rs 20 lakh.

TVH Lumbini Square Owners Association moved the Madras High Court against the AAR ruling.

In its petition, the Association said the notification used the word “up to” Rs 7,500 and argued that only the amount in excess of this is liable for the tax and not the whole amount.

The court sought a response from the Centre on the issue. It also allowed TVH Lumbini Square Owners Association to pay GST only on the maintenance amount over and above the sum of Rs 7,500, until further orders.

Leave a Reply

Your email address will not be published.