Summary of Clarification regarding applicability of GST on certain services through Circular No 228-22-2024
Circular No 228/22/2024 provides Clarification regarding applicability of GST on certain services. It is based on the recommendations of 53rd GST Council Meeting which was held on 22-06-2024. This circular mainly consist of following:
Keypoints of the Circular No 228-22-2024
1. Outward supplies made by Ministry of Railways are exempt from GST.
2. Certain transaction between Special purpose vehicles and Ministry of Railways are exempt from GST.
3. Any statutory collection made by RERA in accordance with Real Estate Act,2016 are not liable for GST.
4. GST on Incentive amount shared by bank with other stakeholders for the promotion of BHIM-UPI Transaction.
5. GST liability on the reinsurance of specified general and life insurance schemes.
6. GST liability on the reinsurance of insurance schemes for which total premium is paid by the government.
7. GST Applicability on retrocession services.
8. GST liability on Certain accomdation service.
1. Outward supplies made by Ministry of Railways are exempt from GST.
The GST Council recommended exemption for certain services by Indian Railways to general Public. The services is related to the:-
- Sale of Platform Tickets
- Retiring rooms and waiting rooms
- Cloak room services
- Battery operated car services
In Addition to the above, service provided between different zones or divisions of indian railways are also exempt from GST.
GST Issues related to the period from 20-10-2023 to 14-07-2024 will be resolved without further penalties or charges as it will regularised on as is where is basis.
2. Certain transaction between Special purpose vehicles and Ministry of Railways are exempt from GST
Services where Special purpose vehicle allows the Railways to use infrastructure built by SPVs during concession period as well as maintainance services provided by the Railways to SPVs are exempt from GST.
Any GST issues or dues during the period from 01-07-2017 to 14-07-2024 will be resolved without additional penalties or changes.
3. Any statutory collection made by RERA in accordance with Real Estate Act,2016 are not liable for GST.
4. GST on Incentive amount shared by bank with other stakeholders for the promotion of BHIM-UPI Transaction.
Incentives paid by MeitY to bank for promoting Rupay Debit cards and low value BHIM-UPI transactions are subsidies hence it is not subject to GST.
It is still remains as subsidies in case where this incentives are shared by bank with other stakeholders in the payment system as decided by NPCI.
5. GST liability on the reinsurance of specified general and life insurance schemes
Reinsurance of certain general and life insurance schemes are exempt from GST from 25-01-2018. Any issues or dues related to this for the period from 01-07-2017 to 24-01-2018 will be resolved without further penalties or changes.
6. GST liability on the reinsurance of insurance schemes for which total premium is paid by the government
Reinsurance of insurance schemes where total premium is paid by the government are exempt from GST for the period from 01-07-2017 to 26-07-2018. Hence any dues or issues related to this for the period of 01-07-2017 to 26-07-2018 will be resolved without any additional penalities or changes.
7. GST Applicability on retrocession services
Retrocession services means reinsurance transaction where part of an assumed reinsured risk is further passed on to another indian insurer or cross border reinsurer. As Reinsurance service includes retrocession services, exemption will be available to retrocession services.
8. GST liability on Certain accomdation services
The GST Council has decided to exempt accomdation service from GST on the fulfilment of following conditions:
- The Cost of the Accomdation is Rs.20,000 or less per person per month
- The Accomdation is provided for atleast 90 continous days.
This exemption is effective from 15-07-2024 as per the Notification issued on 12-07-2024. Any accomdation services provided between 01-07-2017 to 14-07-2024 period and also met all the conditions specified above, the GST liability for these servicies is waived or regularized.
