ACTIVITIES OR TRANSACTIONS OF SOCIETIES OR ASSOCIATIONS TO THE MEMBERS AND BY THE MEMBERS TO THE SOCIETY OR ASSOCIATION WILL COME UNDER THE PURVIEW OF GST SUPPLY.
The Goods and Services Tax Act,
2017 came into force with effect from 1.7.2017 in
The Central Government has amended Section 7 of the Central Goods and Services Tax Act, 2017 through the Finance Act, 2021 (13 of 2021) and implemented the same as per Notification No.39/2021-Central Tax dated 21.12.2021 with Gazette publication and notified that the activities or transactions, by a person, other than an individual, to the members or constituents or vice-versa, for cash, deferred payment or other valuable consideration with the following explanation:
Explanation: For the purposes of this clause, it is hereby clarified that, notwithstanding anything contained in any other law for the time being in force or any judgement, decree or order of any Court, Tribunal or authority, the person and its members or constituents shall be deemed to be two separate persons and the supply of activities or transactions inter-se shall be deemed to take place from one such person to another”.
According to the above amendment, the supply of Goods or Services or both by the Society or Association to its members and by the members to the Society or Association will come under the purview of GST Act, 2017 and hence the Associations or Societies will have to get GSTIN if the supply of Goods or Services or both exceeds rupees twenty lakhs. (Registration limit increased to 40 Lakhs only for Goods and for Services the registration limit of Rs.20 lakhs remains without any change).
It is clearly explained that the person and its members or constituents shall be deemed to be two separate persons and the supply of activities or transactions inter-se shall be deemed to take place from one such person to another.
This amendment comes into force with effect from 1.1.2022 according to CGST Notification No.39/2021-Central Tax, dated 21.12.2021 vide Gazette Publication dated 21.12.2021.
According to the above amendment Rotary Clubs, Lions Clubs and Welfare Associations etc., will have to get GSTIN and furnish GST Returns if it is necessary according to the Goods and Services Tax Act and Rules.
The amendment comes into force with effect from 1.1.2022.
The relevant Notification is given below for ready reference:
