Apartment Owners Associations (AOAs) across Noida have raised strong objections to the Uttar Pradesh tax department's move to impose 18% GST on maintenance and electricity charges collected from residents in housing societies. The move has triggered concern among thousands of apartment owners, who argue that such collections are not commercial activities and therefore should not attract GST.
The UP tax department has reportedly issued notices to around 25 housing societies, seeking records dating back to the FY 2019-20. Prominent societies that have received notices include Prateek Stylome in Sector 45, Antriksh Society in Sector 78 and Prateek Wisteria in Sector 77. Office-bearers of these AOAs have been asked to appear in person and submit detailed financial and electricity billing records.
AOAs Dispute GST Applicability
According to AOAs, electricity charges collected from residents are merely pass-through costs, as power is procured from government discoms and supplied to individual flats at the notified rates. They contend that such activity does not involve profit-making and should not be treated as a taxable supply under GST law.
An office-bearer of Antriksh Society, speaking on condition of anonymity, said that GST law mandates tax only when electricity is supplied with profit. "The government allows AOAs to add around 0.5% per unit to recover transmission and line losses. Tax officials are treating this minimal recovery as 'profit' and demanding GST of nearly Rs 50 lakh, which is an enormous burden for residents," the member said.
Tax Audits and Site Visits Ongoing
Over the past three months, tax department teams have been visiting housing societies and auditing records to determine whether AOAs have charged residents more than the government-approved electricity tariff or earned surplus from maintenance collections. Officials are reportedly examining whether any additional charges qualify as consideration for taxable services under GST.
However, AOAs maintain that maintenance charges are collected on a no-profit, no-loss basis to meet common expenses such as security, housekeeping, lifts, water supply and electricity infrastructure.
Political Intervention Sought
In response to the notices, several AOAs have approached Gautam Buddh Nagar MP Dr Mahesh Sharma and Noida MLA Pankaj Singh, seeking their intervention to resolve the issue and prevent what they describe as an unfair tax burden on middle-class residents.
AOA representatives have urged the state government to issue clear guidelines or exemptions clarifying that resident welfare and apartment owners associations are not commercial entities when collecting maintenance or electricity charges purely for cost recovery.
No Official Comment Yet
Tax department officials were unavailable for comment at the time of reporting. Meanwhile, housing societies fear that retrospective GST demands could significantly increase financial pressure on residents if the issue is not resolved soon.
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