Page 116 - GSTL_16 April 2020_Vol 35_Part 3

330 GST LAW TIMES [ Vol. 35
as envisaged under Section 7 of the CGST Act, 2017, the relevant portion of
which has been reproduced hereinunder :
(1) For the purposes of this Act, the expression “supply” includes -
“all forms of supply of goods or services or both such as sale, trans-
fer, barter, exchange, license, rental, lease or disposal made or
agreed to be “made for a consideration by a person in the course or
furtherance of business.”
Thus, on perusal of the aforesaid definition of supply, it is revealed that for any
activity/transaction to be qualified as supply, the same should be undertaken in
the course or furtherance of business. Now, before applying the above condition
in the context of the impugned transaction, we would like to discuss the meaning
of “business” as provided under Section 2(17) of the CGST Act, 2017, the relevant
extract in the context of the instant case is reproduced herein below :
(17) ”business” includes -
(a) .............
(b) .............
………….
(e) provision by club, association, society, or any such body (for a
subscription or any other consideration) of the facilities or
benefits to its members;
…………..
In the instant case, it has been submitted by the Appellant that entire subscrip-
tion/membership amount collected by the Appellant from its members is uti-
lized solely towards expenditures incurred in the meetings, communication and
other administrative expenses like printers, stationeries etc. They have categori-
cally submitted that they do not provide any facility or benefit to any of its mem-
bers against the said subscription or membership fee. They further submitted
that the object of the appellant-club is to promote peace, fight diseases, provide
clean water, sanitation and hygiene, Support Education, etc. Further, they have
also furnished financial statements pertaining to the year 2016-17 & 2017-18,
which reveals that the entire amount of membership subscription and admission
fees collected by the Appellant is almost spent towards meetings and administra-
tive expenditures of the Appellant.
46. Thus, on perusal of the above submissions and the financial state-
ments, it is observed that the Appellant is not providing any specific facility or
benefits to its members against the membership subscription charged by it, as the
entire subscription amount is spent towards meetings and administrative ex-
penditures only. Thus, we conclude that the Appellant is not doing any business
as envisaged under Section 2(17) of the CGST Act, 2017.
47. Now, once it has been established that the Appellant is not doing
any business in terms of Section 2(17) of the CGST Act, 2017, it can be deduced
that activities carried out by the Appellant would not come under the scope of
supply as envisaged under Section 7(1) of the CGST Act, 2017.
48. On the contrary, if we hold the impugned activities of the Appellant
to be supply, then the membership fee collected by the Appellant, which is pure-
ly in the nature of a reimbursement for the meetings and administrative expendi-
tures incurred by the Appellant to sustain and propagate their inherent pro-
grams, would be subject to the double taxation as the amount spent towards the
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