Reimbursment

[Bharat Cholleti]

Dear sir,

For housing societies reimbursement of electricity bill will attract GST. please advise.

[KASTURI SETHI]

Pl. elaborate query. However, every kind of reimbursement is not taxable under GST.

[Shilpi Jain]

If the conditions of pure agent are satisfied as laid down in rule 33 then no gst will apply. There are some advance rulings in favour and some against, in this regard.

[KASTURI SETHI]

I support the views of Madam Shilpi Jain but I would like to add that exemption is available only if the transaction is out of the definition /scope of 'supply' and 'consideration'.

AI Summary

Pure agent exemption: reimbursements may be outside GST if pure agent conditions and absence of supply are satisfied. Reimbursement of electricity bills by housing societies is GST-exempt only if the payment falls outside the definition of consideration for a supply or meets the pure agent criteria; otherwise it is taxable, and advance rulings on this issue are inconsistent.