Activity of providing hostel on rent for amount less than Rs. 1000 per day is exempt from GST: AAR

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  • Last Updated on 4 March, 2022

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Classification of GST Services Hostel services - Heading No. 9963 [Accommodation food and beverage services]

Case Details: Authority for Advance Rulings, Maharashtra Ghodawat Eduserve LLP, In re - [2021] 132 taxmann.com 46 (AAR - MAHARASHTRA)

Judiciary and Counsel Details

    • Rajiv Magoo and T.R. Ramnani, Member

Facts of the Case

The applicant was engaged in services of commercial training and coaching service for students and it was also providing hostel facility to the students on demand basis and charging them additionally. It filed an application for advance ruling to determine whether activity of providing the hostel on the rent to various students by applicant would be exempt.

AAR Held

The Authority for Advance Ruling observed that it was providing residential facilities which included, well-maintained furnished residence, Light, water, etc., and in consideration, it was charging a nominal lump sum fee of Rs. 34,000/- per year per student, which came to Rs. 95/- (Approximately) per day. The hostel was also available for the students of the nearby schools.

As per the exemption under entry No. 14 of Notification No. 12/2012 – Central Tax (Rate), dated 28-6-2017, it was found that the services provided by hostel, for residential and lodging purposes would be covered by the scope of notification entry where the declared tariff of a unit of an accommodation would be below one thousand rupees per day. Thus, the activity of providing the hostel on the rent to various students by applicant would be exempt where hostel fees charged per student per day shall be less than Rs. 1000.

List of Cases Referred to

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