Clarification, DT. 08/05/2007

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

F.No.137/68/2007-CX.4