Question

Our client, a society, has received sponsorship fees for an Post Graduate Dental Students Convention organized by the Society. The Sponsor is a Limited company. As known to us, GST is to be paid by the receiver of the Service. Now Whether above is an exempt supply ? Whether above is zero rated supply ? If answer to both of the above is No, then how to raise an Invoice without actually charging the GST in the Invoice? What would be the scenario, if the supplier is not registered in GST? We are using Tally.ERP9 to maintain our books

Answer

Service provided by Society is exempt from GST vide S.no 1 of Notification No. 12/2017- Central Tax (Rate) only if the society is registered under 12AA of Income Tax Act and providing services by way of charitable activity.
Charitable activity is defined in the said Notification as follows:-
"charitable activities" means activities relating to -
(i) public health by way of ,
    (A) care or counseling of
    (I) terminally ill persons or persons with severe physical or mental disability;
    (II) persons afflicted with HIV or AIDS;
    (III) persons addicted to a dependence-forming substance such as narcotics drugs or alcohol; or
    (B) public awareness of preventive health, family planning or prevention of HIV infection;
(ii) advancement of religion , spirituality or yoga;
(iii) advancement of educational programmes or skill development relating to,-
(A) abandoned, orphaned or homeless children;
(B) physically or mentally abused and traumatized persons;
(C) prisoners; or
(D) persons over the age of 65 years residing in a rural area;
(iv) preservation of environment including watershed, forests and wildlife;
Further, there is no exemption in respect of Sponsorship Service provided by the society.
further, term Zero rated Supply in GST is used for Exports, Supply to SEZ.

Reverse Charge u/s 9(3) on Sponsorship Service is applicable where the Services provided by way of sponsorship to any body corporate or partnership firm vide S.no 4 of Notification No. 13/2017- Central Tax (Rate).
On the basis of above point wise reply of your query are as follows:-
1. It is not a Exempt supply.
2. It is not a zero rated Supply.
3. GST is to be paid by Limited Company (Sponsor) u/s 9(3). (Reply dt.27/02/2019)