Renting of Residential Property to Govt for Backward Class Girl’s Hostel Exempt from GST: AAR [Read Order]
The Authority held that renting of residential property to the Social Justice and Special Assistance Department of Maharashtra Government for running a hostel for backward class girls qualifies as pure services exempt under Entry 3 of Notification No. 12/2017-CT (Rate).
![Renting of Residential Property to Govt for Backward Class Girl’s Hostel Exempt from GST: AAR [Read Order]](https://images.taxscan.in/h-upload/2025/08/02/2072365-renting-residential-property-govt-backward-class-girls-hostel-gst-aar-taxscan.webp "Renting of Residential Property to Govt for Backward Class Girl’s Hostel Exempt from GST: AAR [Read Order]")
The Maharashtra Authority for Advance Ruling (AAR) ruled that the supply of renting services provided to the Social Justice and Special Assistance Department of Maharashtra Government for operating a girl's hostel for backward classes is exempt from GST as pure services under Entry 3 of Notification No. 12/2017-CT (Rate).Ravindra Navnath Satpute (Dewoo Engineers) (applicant), a...
The Maharashtra Authority for Advance Ruling (AAR) ruled that the supply of renting services provided to the Social Justice and Special Assistance Department of Maharashtra Government for operating a girl's hostel for backward classes is exempt from GST as pure services under Entry 3 of Notification No. 12/2017-CT (Rate).
Ravindra Navnath Satpute (Dewoo Engineers) (applicant), a GST-registered entity, filed an application for advance ruling under Section 97 of the CGST/MGST Act, 2017, seeking clarification on the taxability of renting a jointly owned residential property to the Sant Sakubai Government Girls Hostel.
The property, situated at C.S. No. 690/5, Plot No. 24, Balkashram Road, Ahmednagar, is jointly owned by the applicant (GSTIN: 27CUG55735J1Z1) and his brother, Devendra Navnath Satpute (GSTIN: 27ZJIS0532L1Z1).
It was rented to the hostel, run by the Department of Social Justice and Special Assistance, Maharashtra Government, for 36 months from December 31, 2022, to December 31, 2025, at a monthly rent of Rs. 2,14,283 (excluding taxes). The rent is deposited in a joint account, and the property is used as a residential hostel for backward class and scheduled caste girl students.
The applicant contended that the service qualifies for exemption under Entry 12 of Notification No. 12/2017-CT (Rate), as it involves renting a residential dwelling for use as residence.
Alternatively, it falls under Entry 3 as pure services provided to a State Government in relation to functions under Articles 243G (welfare of weaker sections, women and child development) and 243W (safeguarding weaker sections) of the Constitution, as per the Eleventh and Twelfth Schedules.
In additional submissions, the applicant emphasized the welfare aspect for underprivileged girls and requested clarification on GST TDS applicability under Section 51.
The two-member bench, comprising D.P. Gojare (Joint Commissioner, State Tax) and P. Vinitha Sekhar (Additional Commissioner, Central Tax), observed that the renting service is pure and provided to the State Government for girl's hostel accommodation, aligning with social justice schemes for backward classes under Articles 243G and 243W.
The bench noted that Entries 25-27 of the Eleventh Schedule (women and child development, social welfare, welfare of weaker sections) and Entries 3 and 9 of the Twelfth Schedule (economic and social development, safeguarding weaker sections) cover such activities.
The bench held the service exempt under Entry 3 relying on precedents like the Maharashtra AAAR in Sitali Tukaram Patil, AAR Karnataka in Sri Puttabalingaiah G.H., and AAR West Bengal in Rimita Mukherjee. The AAR allowed the application in part.
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