The Maharashtra Appellate Authority of Advance Ruling comprises members Asok Kumar Mehta and Rajiv Kumar Mital directed that GST and TDS will be exempted from the renting of the immovable property to the social justice department.
The petitioner, Shital Tukaram Borade, is not enrolled and is engaged in the business of furnishing the services of renting out immovable property located in Nashik, and is under the receipt of the rental income.
The property was given to the social Welfare Department (Samaj Kalyan Vibhag), Nashik Division, Maharashtra Government.
The petitioner seeks the advance ruling on the problems of the services given to the Special Assistance Department towards the residential accommodation of underprivileged girls are exempt from GST.
The next issue is that does the TDS law be applied for the case in which the supply of services is exempted. If the petitioner is not enrolled beneath the GST and furnishes the services to the special assistance Department, the TDS notification is given under section 51 of the CGST Act, 2017 would be applicable for the deduction of TDS stays undefined.
AAR ruled that the services given via petitioner to the social welfare department are not privileged via GST and TDS provision would be subjected to apply.
The petitioner was hurt by the order of AAR and furnished a petition on the basis of GST TDS is not subjected to apply when the payment is provided to the nonregistered individual as mentioned beneath section 51 of the CGST Act, 2017.
The petitioner has submitted the FAQs via the law Committee, GST Council, which has described in the Standard Operating Procedure (SOP) on September 28, 2018, that no TDS is needed to be deducted “where the payment is made to an unregistered dealer”. The petitioner submitted that the GST TDS would not be subject to apply when the payment is made to the nonregistered individual as mentioned beneath section 51 of the CGST Act and thus the TDS on that might not be deducted.
The petitioner has given his property to the Social Justice and Special Assistance Department, Government of Maharashtra, which uses that property to furnish the residential accommodation to the underprivileged girls who come from Scheduled Tribes.
The AAR’s order was also discarded by the AAAR by mentioning of the pure services of immovable properties renting given by the appellant towards the state government will be regarded under the activity-based upon the Panchayat under article 243G of the Constitution, or also the function of a municipality under article 243W of the Constitution which gives it the right to be exempted.
Also as per the AAAR, the transaction once exempted to be held from the applicability of GST, there will be nil questions on the TDS provisional application under Section 51 of the CGST Act, 2017.
