Cooperative socities

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RAVI SONI (Querist)
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24 March 2012 A cooperative society is charging monthly maintenance charges from the flat owners whether the cooperative society is liable to charge Service Tax from the flat owners ?

If there is any circular or notification please provide the no.

What is the category of such service ?

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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25 March 2012 Generally in case of housing co-operative society is nothing but the contract of mutuality and in this case no income tax, Service Tax etc is chargeable.. The notification is as follows:-

F.No.137/68/2007-CX.4
Government of India
Ministry of Finance
Department of Revenue
Tax Research Unit
*****
New Delhi, the 8th May, 2007.
Subject: Exemption to resident welfare association vide notification No.8/2007-Service Tax, dated 01.03.2007 – Regarding.

A number of representations have been received from Co-operative Group Housing Societies who are providing taxable services under section 65(105)(zzze) seeking whether a resident welfare association registered as a co-operative society with the Registrar of Co-operative Societies is entitled for the benefit of service tax exemption under notification No.8/2007-Service Tax, dated 01.03.2007 or not.

2. A resident welfare association, even if it is registered as a co-operative society with Registrar of Co-operative Societies, is eligible to avail exemption from levy of service tax vide notification No.8/2007-Service Tax, dated 01.03.2007 provided the following conditions are satisfied, namely:-

(1) The exemption is available for the services specified under section 65(105)(zzze) of the Finance Act, 1994 and provided or to be provided by the association to its members.
(2) The sole criterion for membership of the resident welfare association is the residential status of a person in a residential complex or locality i.e., membership of the association is restricted only to the residents of the complex or locality.
(3) The value of total consideration received from an individual member by the association for providing the services should not exceed Rs.3,000/- per month.

3. This issues with the approval of Member (Budget).

Yours faithfully,
(G.G. Pai)
Under Secretary to the Government of India

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