LEFT IN LURCH - RESIDENTS OF DIVINE MEADOWS PAYING 18% GST ON MAINTENANCE AND ELECTRICITY
Residents of DIVINE MEADOWS a project of Divine India Infrastructure in SECTOR 108
NOIDA are being charged 18% GST on their maintenance and electricity bills. They
have approached the builder on numerous occasions after a notification which says that GST is exempt
for maintenance bills less than 5000 but their requests have gone into the deaf ears. The
builder has clearly said that he would continue to charge 18% GST. Hence the
residents are feeling helpless and are forced to pay the GST in order to get
the uninterrupted services. The monthly maintenance charges in Divine Meadows
range from Rs 1500 to 3000 rupees a month.
As per the Goods and Services
Tax law, maintenance charges upto Rs 5000 a month are exempt from GST. Although
the Finance Ministry has issued a clarification, this arbitrary
calculation of GST done by the builder has left home owners of Divine Meadows
confused.
The
residents are worried as they have no clue where to go and to whom they should raise this issue.
They wanted clear guidelines regarding GST on maintenance bills but are
confused whom to approach
According to Divine India if a builder or its appointed company
is taking care of the maintenance of the project then they have to charge GST
irrespective of the amount
The
notification has the following language
As per guidelines on maintenance
charges upto Rs. 5000/- no GST is applicable. Maintenance charges means only
maintenance or collection of all charges
This is applicable to only the
reimbursements of charges or share of up to an amount of five thousand rupees
per month per member for sourcing of goods or services from a third person for
the common use of its members. Here, charges mean the indivisual contributions
made by members of the society to avail services or goods by the society from a
third party for common use. [*Entry 77(c) of notification no 12/2017 Central
Tax (Rate) dated 28.6.2017 refers]
Monthly maintenance (all above
charges) are below Rs.5000/-but yearly total collection exceeds Rs. 20 lakhs
limit whether GST is applicable
Reimbursement of charges or share of
contribution up to an amount of Rs. 5000/- per month per member for sourcing of
goods or services from a third person for the common use is not liable to GST.
However, if the Cooperative society/ RWAs provide specific services of its own
to its members or to any third party (e.g. use of community hall for social
function by a non-member) cumulatively exceeds the threshold limit as per GST,
then GST is leviable on such supply of services.
“We need clarity from the GST Council or
Ministry of Finance regarding GST ON MAINTENANCE” said a resident
“The builder is also charging GST on
electricity bills and as per our understanding he is only supposed to charge
GST on power backup but we have no clarity as yet” said
another resident of same society
There are other societies in
NOIDA and Greater Noida where the residents have raised the same issue of GST
on maintenance and electricity bills but everyone is confused and there are no
proper guidelines from the government. The confusion regarding GST rates remains
unresolved.
When we explored the official GST websites the following email IDs were found where we can raise the issues
When we wrote to them the following automated message was received. The residents can try raising webtickets and see if they get any help
Thank you for writing to us at CBEC Mitra Helpdesk.
We received your support request, and we understand that you want to know the steps for reporting any instance of tax evasion or fraud to the concerned authority.
To go to the specific information webpage, please follow the steps listed below:
1. Go to the CBEC-GST website at www.cbec-gst.gov.in.
2. On the homepage, click Raise a Webticket at the bottom of the screen.
3. On the left pane, select Report Tax Fraud / Avoidance.
4. Fill all fields on this form, and then click Submit.
Note: To report any tax evasion or fraudulent activity, you can also click the link: https://www.cbec-gst.gov.in/report-tax-fraud.html.
If you have any information regarding Central Excise fraud or evasion, you can also call on 011-26174191 or email to add-dgcei@nic.in.
Thanks and Regards,
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