RCM Applicable on Service of Renting Residential Property: AAR Odisha


RCM Applicable on Service of Renting Residential Property: AAR Odisha


The Applicant, M/s. Indian Metals and Ferro Alloys Limited had sought for an advance ruling in respect whether service received by a registered person by way of renting of residential premises used as a guest house is subject to  Forward Charge Mechanism (FCM) or Reverse Charge Mechanism (RCM).

The  Authority Bench observed that the renting of an immovable property / residential dwelling is considered a supply of service under GST as per schedule II of the CGST Act 2017. Till 17th July 2022, services by way of renting of residential dwelling for use as residence was exempted.It was further observed  that the decision to bring the renting of residential dwellings under the tax net was taken in the 47th GST Council Meeting held in June 2022 by partially removing the exemption and including the same under RCM services when provided to a registered person.

It was thus ruled that, wherein the Applicant (Registered person) has received the service by way of taking residential premises on rent for use as its guest house, it is observed that the said service received by the Applicant (Registered person) is subject to GST under Reverse Charge Mechanism in view of the Notification No. 05/2022- Central Tax (Rate) dated 13.07.2022.


The copy of the order is as under:

Orisha AAR orderno. 04-Orisha AAR-2021-22


Krishnakant Jakhotia
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Email Id :- taxtalknew@gmail.com