The Telangana Authority of Advance Ruling (AAR) ruled that no GST payable for renting of space for stalls with the objective of advancement of religion for the Rent not above Rs.10,000.
The applicant, M/s. Acharya Shree Mahashraman Chaturmas Vyvastha Samiti is a charitable religious institution which is providing space for rent on temporary basis during chaturmas. As they are not truly doing this activity with a profit motive they are desirous of clarification regarding exigibility of their supplies to tax.
The applicant has sought the advance ruling on the issue whether Applicant is liable to pay tax on renting of temporary residential rooms for consideration to the devotees and renting of space for shops and stalls for the purpose of religious programmers where the predominant object is not to do business but for advancement of religion.
The applicant is a religious institution and is temporarily renting residential rooms for consideration and similarly they are also renting space for stalls for consideration. The understanding of the applicant is based on the pronouncement of Hon’ble Apex Court of India in the case of Commissioner of sales tax Vs Sai publication fund (2002) Appeal (civil) 9445 of 1996 [2002]126 STC 288 (SC) wherein it was held that, where the main activity is not business, then any incidental or ancillary transaction, unless established by the revenue department to be an independent business transaction, will also be considered as charitable only and not business. Further it was also held that, where the main and dominant activity of the assessee trust in that case was to spread the message of Sai baba, then bringing out publications and sale thereof by the assessee trust to its devotees at cost price did not amount to business.
The coram of Raghu Kiran and S.V. Kasi Visweswara Rao ruled that the applicant is liable to tax only if the room rent per day is Rs.1,000/- or more as per Entry 13 of Notification 12/2017.
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