GST applies to pooled lease rentals for business use; residential dwelling exemption fails where the premises are not truly used as a residence.

Renting or leasing of immovable property under a single contract for business use was treated as a taxable supply of services under GST, as the pooling of multiple lessors did not change the character of the transaction and individual invoicing was not determinative. The exemption for renting of a residential dwelling applied only where both the premises and their actual use satisfied the statutory requirement of use as residence. Because the accommodation was found to be hotel-like rather than a residential dwelling, the exemption was unavailable and GST was payable on the lease services.

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Issues: (i) Whether the lease services supplied by the group of lessors to the company constituted a taxable supply of services under the GST law. (ii) Whether the lease services were covered by entry 13 of Notification No. 9/2017-Integrated Tax (Rate) as services by way of renting of residential dwelling for use as residence.

Issue (i): Whether the lease services supplied by the group of lessors to the company constituted a taxable supply of services under the GST law.

Analysis: The agreement showed that the property had been pooled by multiple lessors and let out under a single contract for consideration. The transaction was treated as leasing or renting of immovable property for business purposes. Such a transaction fell within the scope of supply under Section 7(1) of the Central Goods and Services Tax Act, 2017 and, by virtue of Section 7(1-A) read with Entry 2(b) of the Second Schedule, was a supply of services. The ruling also noted that the applicant was not acting in an individual capacity but as part of a group of lessors, and therefore the question of individual invoicing to the company did not alter the taxable character of the supply.

Conclusion: The lease transaction was a taxable supply of services and GST was payable by the lessors as an entity.

Issue (ii): Whether the lease services were covered by entry 13 of Notification No. 9/2017-Integrated Tax (Rate) as services by way of renting of residential dwelling for use as residence.

Analysis: Entry 13 exempted only services by way of renting of a residential dwelling for use as residence. The premises described in the lease consisted of multiple rooms with attached toilets and was found to be more akin to hotel-type accommodation than a residential dwelling. The arrangement was also not established as use as residence in the sense required by the exemption. The ruling distinguished such accommodation from the exemption entry and held that the nature of the premises did not satisfy the statutory description.

Conclusion: The exemption under entry 13 was not available and the lease services did not qualify as renting of residential dwelling for use as residence.

Final Conclusion: The applicant's claim to GST exemption failed, and the lessors were held liable to charge GST on the lease services.

Ratio Decidendi: Renting or leasing of immovable property for business-related use is a taxable supply of services, and exemption provisions for residential dwelling apply only where the premises and their use strictly satisfy the statutory description.

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