GST Applicability to Residential Accommodation Services for Underprivileged Girls

The ruling determined that services provided for residential accommodation of underprivileged girls to a State Government department are not exempt from GST as they do not directly relate to functions entrusted under specific constitutional articles. Consequently, TDS provisions apply, including the TDS notification under section 51, even for unregistered GST suppliers. The ruling did not address the entitlement to a refund if TDS is deducted, as it falls outside the scope of Section 97 of the CGST Act, 2017.

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Issues Involved:
1. GST exemption on services provided for residential accommodation of underprivileged girls.
2. Applicability of TDS provisions on exempt services.
3. Applicability of TDS notification under section 51 for unregistered GST suppliers.
4. Entitlement to refund if TDS is deducted.

Issue-wise Detailed Analysis:

1. GST Exemption on Services Provided for Residential Accommodation of Underprivileged Girls:

The applicant, a co-owner of immovable property, leases the property to the Samaj Kalyan Vibhag (Social Welfare Department) of the State Government of Maharashtra for housing underprivileged girls. The applicant contends that these services are exempt from GST under Notification No. 12/2017- C.T. (R) dated 28.06.2017, which exempts "pure services" provided to the government in relation to functions entrusted to Panchayats or Municipalities under Articles 243G and 243W of the Constitution.

Upon examination, it was found that the applicant's services qualify as "pure services" and are provided to a State Government department. However, the applicant failed to provide sufficient evidence to demonstrate that these services are directly related to functions entrusted under Articles 243G or 243W. Consequently, the services do not qualify for the GST exemption under the cited notification.

2. Applicability of TDS Provisions on Exempt Services:

The applicant queried whether TDS provisions apply if the services provided are exempt from GST. Since the ruling determined that the services are not exempt from GST, the TDS provisions under section 51 of the GST Act are applicable.

3. Applicability of TDS Notification Under Section 51 for Unregistered GST Suppliers:

The applicant, not registered under GST, questioned the applicability of TDS notifications under section 51. The ruling confirmed that TDS notifications under section 51 are applicable, even if the supplier is unregistered, as the services provided are taxable.

4. Entitlement to Refund if TDS is Deducted:

The applicant sought clarity on whether they would be entitled to a refund if TDS is deducted. The ruling refrained from answering this question, as it pertains to entitlement of refund, which is not covered under Section 97 of the CGST Act, 2017.

Order:

1. The services provided to the Samaj Kalyan Department for residential accommodation of underprivileged girls are not exempt from GST.
2. TDS provisions will be applicable in the case where the supply of services is not exempt.
3. TDS notification under section 51 is applicable for deduction of TDS.
4. The question regarding entitlement to a refund of deducted TDS was not answered.

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