Aggregate Turnover

[Prem Gomathy]

Dear Sir,

Charitable trust registered u/s 12A of the IT Act, receives donations. Due to donations, the total of the Income and Expenditure a/c exceeds 5cr.

Other than the donations, the (taxable supply + exempt supply) comes only to ₹ 30L.

In such case is filing GSTR-9/9C mandatory by taking donations as part of aggregate turnover? As donations are just in the nature of gift or financial transaction, cant they be excluded from the ambit of Aggregate turnover?

[ABHISHEK TRIPATHI]

Dear Prem Sir,

Donation doesn’t fall under the definition of aggregate turnover. It's not taxable supply or falling under other ingredients as mentioned under section 2(6).

Relevant provision as under:

S. 2 (6) ―aggregate turnover means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess;

[KASTURI SETHI]

No hope. Cannot be excluded.

[ABHISHEK TRIPATHI]

Excluded ? @KS Sir

[Prem Gomathy]

Money is excluded from the definition of goods or service. So does it fit in as such?

[ABHISHEK TRIPATHI]

All the ingredient for AT is more or less related to supply. Receiving donation is not at all a supply.

Yes Sir, your money point also holds good. As donation in your context is not goods or services.

[Prem Gomathy]

Correct Abhishek Sir,

It is not received for any particular purpose. Like you said it doesnt fit into any supply. As such there is no consideration, nor quid pro quo.

Also in other cases that are exempt like interest received, we put money in the bank and for that we earn interest. Atleast there is furtherance of business or benefit for one party. But for donation the benefit is received by a third party.

[KASTURI SETHI]

SH. ABHISHEK TRIPATHI Ji,

Re-examined on being pointed out by you. I agree with you. You are absolutely right, Sir. I correct my reply as per your interpretation, analysis and conclusion.

Thanks a lot for enrichment of my knowledge.

AI Summary

Donations excluded from aggregate turnover under GST as not supplies, affecting assessment of annual return thresholds. Donations are not supplies and thus do not fall within the statutory definition of aggregate turnover under section 2(6); they are monetary gifts outside the listed components (taxable supplies, exempt supplies, exports, inter State supplies) and therefore are excluded when computing the turnover threshold for annual return and reconciliation obligations.