Karnataka HC – The New Indian Express

By Express press service

BENGALURU: The Karnataka High Court has ruled that a building owner is entitled to tax exemption benefits under the Goods and Services (GST) Act if the rented residential premises are used as a hostel for students and professionals.

Quashing an order made by the Karnataka Advance Rulings Appeal Authority, the court considered whether the services provided by the petitioner, Taghar Vasudeva Ambrish of Jayanagar, in renting his residence as a hostel in students and professionals are covered by Entry 13 of the notice dated September 28, 2017, namely “Services by way of rental of residential accommodation for use as a residence” issued under the integrated goods and services tax , 2017.

“The notification does not oblige the lessee to use the premises himself as a dwelling. The benefit of the exemption notification cannot be refused to the applicant on the grounds that the lessee does not use the premises. AAAR Karnataka’s conclusion that the hostel is more akin to “social accommodation” is irrelevant in determining the applicant’s eligibility to claim the benefit under the Exemption Notice.” said judges Alok Aradhe and MI Arun.

Linda G. Ibarra