TaxTMI 
TaxTMI 
2024 (8) TMI 294
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.... mention is specifically made to any dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, the expression 'GST Act' would mean CGST Act and MGST Act. 1. FACTS AND CONTENTION - AS PER THE APPLICANT: 1.1 The Applicant, Maharashtra Jain Education Society, (hereinafter referred as 'the Applicant' for brevity) is registered with the Charity Commissioner, Pune Division, Pune, under the registration No F-1993 dated 21st November 1978. 1.2 The Applicant is also registered as a Charitable Trust under Section 12AA of the Income Tax Act, 1961 vide the order of registration in Form No 10AC dated 23rd September 2021. 1.3 The Applicant is inter-alia engaged in providing accommodation services in the hostels run by the Society. Such services are provided only to the students studying in 11th standard up to the students pursuing graduation, for the academic year from 1st July to 30th April and in the School / College vacation period, from 1st May to 30 June. These services are provided as per the needs of the student either for examination or fo....
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....r the students who do not wish to stay further will be given as per the rules and regulations; 1.6 The fees for hostel accommodation services charged from the students is Rs. 1,10,000, for the academic year from 1st July to 30th April. Further, a refundable Security Deposit of Rs. 10,000 is taken from the students of the hostel. A concession in fees is provided to the students in need based on various factors. A sample copy of the receipt of the hostel fees for the academic year from the student is submitted on record. 1.7 The fees for hostel accommodation services charged from the student is Rs. 10,000 per month for the vacation period from 1st May to 30th June as per the needs of the students either for examination or for undergoing educational courses. In this case also, a refundable Security Deposit of Rs. 10,000 is taken from the students. A sample copy of the receipt of hostel fees for the vacation period from the student is submitted on record. 1.8 The estimated fees collection for the hotel accommodation during the financial year 2022-23 will be as under: Sr.No. Particulars Amount Period of Stay 1 Term Fees for the academic year from 294 students ....
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....Notification and no GST would be leviable on the provision of such services. Basis the grounds below, the Applicant wishes to substantiate how the hostel accommodation services provided are covered under the above-mentioned entry of the Exemption Notification. 2.2 The hostel accommodation services provided by the Applicant is a renting service: 2.2.1 The applicant is mainly providing hostel accommodation services to the students. However, to provide such services, the following services are also jointly being provided to the students:- • Mess/Canteen: The students are provided meals in the mess/canteen; • Facilities provided in the room: The students are provided bunk beds, steel cupboards, study tables, chairs, clothes drying stands, fixtures and fittings; • Solar water heaters: The hostel has solar water heaters which ensures hot water facility to the students; • Other facilities: The hostel consists of a dormitory section, a community hall, modern mess equipments, and utensils, computers for the students, parking spaces, play area, auditorium, study area with internet connection. 2.2.2 The applicant wishes to submit th....
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....o stay in a hostel, it is important to provide all these supplies along with the accommodation services. All these supplies are thus provided together as a package with the hostel accommodation services in the ordinary course of business. • Further, a single receipt is provided to the students in relation to all these supplies These supplies are thus naturally bundled in the ordinary course of business. • The supply of hostel accommodation is the main supply and the other supplies are provided in order to provide the main supply of hostel accommodation. Thus, hostel accommodation service is the principal supply and the other supplies are merely ancillary to it. • Thus, the provision of hostel accommodation services along with the other services would qualify as a composite supply. • Being a composite supply, it would be leviable to tax at the GST rate applicable to the principal supply of hostel accommodation service. 2.2.7 In light of the above, we wish to bring your attention towards the Dictionary meaning of the term 'renting'. The same means 'allowing someone to use something in return for payment'. The Applicant wishes to ....
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.... is any residential accommodation, but does not include hotel, motel, inn, guest house, campsite, lodge, house boat, or like places meant for temporary stay." 2.3.5 The above guide provides that a residential dwelling means a residential accommodation, but it does not include temporary stays in hotel, motel, inn, guest house, campsite, lodge, house boat or similar places. Thus, it can be inferred that any residential accommodation used for long term stays can be considered as residential dwelling. 2.3.6 Basis the above guide, the Applicant wishes to substantiate that the hostel accommodation services provided by the Applicant would qualify as a residential dwelling based on the below submissions: A. Stay in hostels do not qualify as a temporary stay: The term 'temporary stay' is not defined anywhere in the CGST Act, 2017 or under the Finance Act, 1994. Reference is thus drawn to the definition of the term 'temporary residence' as per the Law Insider Dictionary. The same has been reproduced below for your ease of reference: "temporary residence means a place where the person abides, lodges, or resides, including, but not limited to, vacation, business, or person....
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....ined under the CGST Act, 2017. Thus, the Appellant wishes to refer to the decision given by the Hon'ble Supreme Court in the case of Jeewanti Pandey Vs Kishan Chandra Pandey (MANU/SC/0312/1981; (1982) 1 SCR 1003) wherein the Apex Court observed that: "In ordinary sense 'residence' is more or less of a permanent character. The expression 'resides' means to make an abode for a considerable time; to dwell permanently or for a length of time to have a fixed home or abode. Where there is such fixed home or such home at one place, his legal and actual residence is the same and cannot be said to reside at any other place where he had gone on a casual or temporary visit. But if he has not established home, his actual and physical habitation is the place where he actually or personally resides." 2.4.2 Based on the above, it can be inferred that 'residence' is of a permanent nature i.e. when a person resides at a place for a considerable period of time, it is considered as 'residence'. A place where someone casually or temporarily visits cannot be termed as residence. 2.4.3 Drawing inference from the above definition, a considerable period of time could be understood as a plac....
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.... students and working professionals is covered under Entry 13 of IGST Notification No.9/2017 dated 28.09.2017 namely 'Services by way of renting of residential dwelling for use as residence In view of the above submissions, the Applicant contends that Serial Number 12 of the Exemption Notification is applicable to hostel accommodation Services provided by the Applicant and thus, GST is not applicable on such services. 3. Submission of the jurisdictional officer; - Officer made submission dated 31-05-2024 and 12-06-2024. He stated that benefits of Exemption notification are not available to the Applicant. Submissions are reproduced and dealt wherever applicable and necessary 4. HEARING Preliminary hearing in the matter was held on 09.05.2024. Mr. Nitin Shah, Advocate appeared and requested for admission of the application. Jurisdictional Officer Mr. M.A. Bhagat, Deputy Commissioner of State Tax Also appeared. The application was admitted and called for final hearing on 26.06.2024. Mr. Nitin Shah, Advocate, Authorized Representative of the applicant, appeared made oral and written submissions. Jurisdictional Officer Mr. M.A. Bhagat, Deputy Commissioner of State Tax ....
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....nations and such 3 reframed questions are answered. In support of this application the applicant has relied on judgment of two non-jurisdictional High Courts namely (i) Hon' High Court of Karnataka, in case of TAGHAR VASU DEVA AMBRISH versus Appellate Authority for Advance Ruling, Karnataka and others in W.P. No. 14891 of 2020 (T-RES) decided on 7th February 2022 and (ii) Hon' High Court of Judicature at Madras in case of Thai Mookambikaa Ladies Hostel versus Union of India and others in W.P. No. 28486 of 2023 decided on 22-C3-2024. 5.7 Supply of hostel accommodation services to students with mandatory supply of meals and other necessary amenities, for duration of stay of 10 months- 5.7.1 Submission of the Applicant-The facts of this and those facts of the case and questions raised before Hon'ble Madras High court in in Case of Thai Mookambikaa Ladies Hostel (Supra) are similar. a. In that case the Petitioner had filed an application for Advance Ruling before the Advance Ruling Authority, Tamil Nadu under provisions of the Tamil Nadu Goods and services Act, 2017. Facts stated in the decision of the Authority in brief are as under, "6.3. ....
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....nt of the hostel accommodation being an exempt activity, whether the incidental activity of supply of in-house food to the inmates of the hostel would also be exempt being in the nature of a composite exempt supply? Answer: The activity of supply of inhouse food to the inmates of the hostel amounts to providing services in a composite manner and the hostel accommodation services provided by the Applicant, being the principal supply, which is taxable @18%, is the tax rate for the composite supply provided by them. Aggrieved by the decision of the Authority, the applicant filed Writ Petition before the Madras High Court vide Writ Petition No. 28486 of 2023, which is decided by Hon'ble Court on 22-03-2024 as under, Paragraph No. 57-Sub-Paragraph 13 has quoted with approval judgment of the Hon'ble Division Bench Karnataka High Court in case of Taghar Vasudeva Ambrish (Supra) has observed as under: "13. It is noteworthy that the accommodation which is used for the purposes of the hostel of students and working women is classified in residential category in the Revised Master Plan 2015 of Bangalore City. The Supreme Court in KISHORE CHANDRA SINGH VS BA....
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....ot from the perspective of service provider, who offers the premises on rental basis. "64. In the light of the above discussion, it is clear that the renting out the hostel rooms to the girl students and working women by the petitioners is exclusively for residential purpose, this Court is of the considered view that the condition prescribed in the Notification in order to claim exemption, viz., 'residential dwelling for use as residence' has been fulfilled by the petitioners and thus the said services are covered under Entry Nos. 12 and 14 of the Notification No. 12/2017-Central Tax (Rate) dated June 28, 2017, the petitioners are entitled to be exempted from levy of GST." (Emphasis supplied) 5.7.2 Submission of the Jurisdictional Officer is as under, The applicant, Maharashtra Jain Education Society Pune is providing hostel facility to students of 11th standard up to degree level. The society is not running any educational Institute. It has 82 rooms housing 298 Students. The rooms are 2seated, 4 seated, 8 seated, 40 seated and hostel is ground +2 story building. The applicant is registered under GST Act having GSTIN 27AAATM1635P2Z8 with effect from 18/06/20....
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....d answered are also same except question of liability to get registered. b. We have gone through the aforesaid judgments and provisions of law, and are of the opinion that the ratio laid down the judgment that the Hostel accommodation with compulsory supply of meals with hostel amenities as described is composite supply and eligible is in fact is renting of residential dwelling for residential purpose, and eligible for exemption, are correct and applicable to this case. There are Orders of Advance Ruling Authority of Rajasthan in case of M/s Mody Education Foundation, in ADVANCE RULING NO. RAJ/AAR/2022-23/04 dated 19-05-2022, which are based on its earlier Order of Appellate Authority of Advance Ruling, Rajasthan in case of M/s Kalani Infrastructure Private Limited, in APPEAL No Raj/AAAR/APP 05/2019-20 decided on 12-05-2020 vide Order No RAJ/AAAR/7/2019-20 dated 12-05-2020. In these Orders it is decided that such supplies are of Hostel Accommodation with supply of Food are mixed supplies and not eligible to benefits of Entry at Sr No 12 of the Exemption Notification. c. Now coming the decision of High Courts relied upon by petitioners and its binding precedent on ....
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.... this Court, and, as we have already stated, it has been generally followed by this Court, barring certain exceptions like where inadvertently the decision was not brought to its notice or where in the decision of the other Courts some relevant provision of law had been omitted to be considered. The decision of the Gujarat High Court is a very elaborate one, considering all the relevant provisions of law. This is, therefore, not a case in which we should depart from the aforesaid policy of this Court. The answer, therefore, will have to be against the Revenue." (Emphasis supplied) e. During the arguments Jurisdictional Officer did not bring to notice any contrary binding decision of either Bombay High Court or Supreme Court on this issue, nor any infirmity in this judgment. We as authority are satisfied that the decision is in depth and well-reasoned and no provision of law or binding judgment of Supreme Court is overlooked by those Courts. 5.7.4 Decision:-Considering the aforesaid decisions, and not having knowledge of any binding judgment of Bombay High Court or Supreme Court, we have no hesitation in following the decision of Hon'ble Madras High court in cas....
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....stel for sleeping, eating and for the purpose of studies for a period ranging between 3 months to 12 months. In the hostels, the duration of stay is more as compared to hotel in guest house, club etc." (Emphasis supplied) b. Another guidance is available in the same judgement in paragraph 56 which is as under: "56. Ultimately, the Authorities have to lock into the aspect as to whether the particular place is a dwelling unit or not. When such being the case, since the hostellers are staying in the room for months together, it cannot be construed as non-residential unit and certainly it is a residential dwelling as provided in the Entry No. 12 of Exemption Notification No. 12 of 2017.---------" (Emphasis supplied) Use of words "when such being the case since the hostelers are stayed in the room for months together" it cannot be construed as non-residential unit. Hence inference is drawn from this aforesaid observation of the hon'ble Court that only period for tenure of 3 months and above is to be treated as residential purpose and any period having tenure of 1 of 2 months that is not for months together cannot be treated as residence purpo....