2026-VIL-63-AAR
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SGST Advance Ruling Authority

GST – Karnataka AAR - Taxability of Corpus Fund Contribution by Apartment Owners Association - The applicant, an Apartment Owners' Association/Resident Welfare Association, collects a corpus fund from its members in addition to regular monthly maintenance charges - The corpus fund is intended to be used for future capital expenditures such as building repairs, replacements, and refurbishment - Whether the collection of the corpus fund amounts to a "supply" under Section 7 of the CGST Act, 2017, and if so, whether the applicant is entitled to the exemption provided under Entry No. 77 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 - HELD - The collection of the corpus fund from members constitutes a "supply" under Section 7(1)(aa) of the CGST Act, 2017, as the applicant, being an association of persons, is performing an activity for its members for consideration. The corpus fund is in the nature of an advance towards future supply of services and not a deposit, and therefore, GST is payable at the time of collection of the corpus fund under Section 13(2)(a) of the CGST Act, 2017 - The exemption of Rs.7,500 per member per month provided under Entry No. 77 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 is not applicable to the corpus fund, as it is distinct from the monthly maintenance charges and cannot be clubbed together for the purpose of the exemption. The corpus fund is collected for specific capital expenditures, while the monthly charges are for regular, recurring expenses, and therefore, the two cannot be treated as a single supply for the purpose of the exemption – Ordered accordingly
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