Charitable trust liable to pay GST in Maharashtra, rules AAR

Goods and services provided by charitable trusts for a consideration would classify as supply, making it liable for GST, the authority of advanced ruling (AAR) for GST in Maharashtra has ruled.

Goods and services provided by charitable trusts for a consideration would classify as supply, making it liable for GST, the authority of advanced ruling (AAR) for GST in Maharashtra has ruled. The ruling further states that trusts would need to register under GST if its annual turnover was above the threshold of Rs 20 lakh.

The trust in its application argued that since its main activity was that of a charitable trust engaged in spreading religious knowledge by organising camps (satsang, shibirs), its ancillary activity of selling religious material in the forms of books, CDs, DVDs, pamphlets and statues shouldn’t be considered as business.

AAR rejected the trust’s contention saying that some of its activities — providing accommodation for participants in camps and sale of merchandise — weren’t free and hence attracted GST.

“As such arranging residential or non-residential satsang/shibir/yoga camps by accepting/charging some amount from participants will not be covered under ‘charitable activities,” the order stated. It further said that there is no exemption granted to charitable trusts in case of supply of goods which are taxable and are not specifically exempt or nil rated.