Several residential groups in Noida face potential 18% GST liability after Uttar Pradesh tax officials seek details on maintenance and bundled services.
Noida, Uttar Pradesh: Residential apartment owners’ associations (AOAs) in Noida have been served notices by the Uttar Pradesh tax department alleging potential non-compliance with Goods and Services Tax (GST) rules on maintenance and electricity charges collected from residents. The move has raised concerns among local residents and society committees about large tax liabilities that could run into crores of rupees.
Over the past three months, tax officials have visited the offices of multiple societies seeking detailed information about charges collected for services such as maintenance, club facilities, electricity (grid and generator), and other bundled provisions. The authorities are examining whether these components form a composite supply liable for GST at 18 per cent. ThePrint
Apartment owners’ bodies say that under previous tax regimes, including earlier periods of the GST framework introduced in 2017, such maintenance and electricity recoveries were not considered taxable. However, the notices suggest the department now considers bundled service charges as subject to the full GST rate, prompting calls for clarifications from central tax authorities.
Residents and AOA leaders argue that many of these charges have historically covered only administrative and operational costs. Under Uttar Pradesh’s electricity tariff schedule, up to a five per cent administrative margin over the supplier’s bill is permitted, intended to cover billing, accounting, audits, and distribution expenses, they noted.
“It’s creating tension and confusion; we were never informed this would attract GST,” said a representative of an AOA in Sector 50 who requested anonymity. Societies such as Antriksh Green, Lotus Boulevard and Prateek Stylome have received notices demanding past records for financial years dating back several years, fuelling concerns over interest and penalties.
In response to the tax notices, the Noida Federation of Apartment Owners Associations (NOFAA) and several RWAs have been compiling bills and records to demonstrate that excess charges beyond the permitted administrative margin were not arbitrary fees but necessary operating costs. They are also engaging with chartered accountants and legal advisors to prepare formal replies to the tax department.
Local residents fear that if the tax department’s interpretation stands, it could significantly increase financial pressure on households. “Ultimately the burden may fall on residents,” said Sumit Gupta, a resident of Sector 45, expressing worries that additional GST, interest, and penalties could affect household budgets.
Officials from NOFAA have said they plan to seek clarification from the Central Board of Indirect Taxes and Customs (CBIC) and possibly appeal for a broader policy interpretation that exempts Resident Welfare Associations (RWAs) from such tax obligations under the existing circulars. Some committees have also considered organising collective meetings with tax officials to address procedural issues and seek relief on behalf of residents.
About Apartment Owners’ Associations in Noida
Apartment Owners’ Associations and Resident Welfare Associations (RWAs) manage the day-to-day affairs of housing societies, including maintenance, utilities, billing, and shared facilities. These bodies are typically non-profit in nature and operate to provide smooth living conditions for residents. Decision-making and office-bearing roles are honorary, and collections from members are used solely for operational expenses.
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