GST council recognises Noida authority as civic body, residents to be benefited

The letter has brought to an end a confusion over GST charges, as many departments of the authority were unsure if GST applied to the services they offered.

The Noida authority on Thursday said that it has received a letter from the Goods and Services Tax (GST) council recognising it as a civic body.

Residents have welcomed the move. (Sunil Ghosh/HT Photo)

The letter has brought to an end a confusion over GST charges, as many departments of the authority were unsure if GST applied to the services they offered.

Now that the authority has been acknowledged as a civic body, residents or individual plot owners will not have to pay GST for many services, including sewer and water taxes, which are provided by the Noida authority.

“However, if a property owner is a business entity that has a turnover of more than Rs20 lakh, then he/she will have to pay GST as per prevailing rules. Institutional, commercial, industrial and group housing plot owners will have to pay GST as per rules. However, the industrial plot owners will not have to pay GST on land cost. Non-business entities such as schools, medical colleges and religious buildings will not have to pay GST for services provided by the Noida authority,” Manmohan Mishra, financial controller of the Noida authority, said.

According to the Noida authority, GST will also not be imposed on penalties levied on allottees. It means GST will not be imposed on any sort of penalty. For example, the authority charges a penalty from builders for failing to clear their land dues, but defaulters will not have to pay GST on the penalties.

“If a business entity has a turnover of less than Rs20 lakh, they will not have to pay GST for services provided by the Noida authority. But if the business entity is earning by renting out the property, it will be a different case,” Mishra said.

Authority officials said they lacked clarity on GST as unlike other municipal bodies, such as the Ghaziabad municipal corporation, Noida is an industrial body that was formed under the provisions of the Uttar Pradesh Industrial Act, 1976.

Residents have welcomed the move. “We have been opposing GST levied on services of the Noida authority since it was put into effect. Now we welcome the GST council’s move, which considers Noida as a civic body and waives off GST for individual allottees,” AN Dhawan, secretary general of the federation of Noida RWAs, said.

SK Jain of Sector 92 said,“The GST council’s move will benefit individual plot owners to a large extent in Noida. Earlier, there was confusion among officials of the Noida authority but now, they will not impose GST on services as well as penalties. The good thing is that religious buildings have also been exempted.”