Hostel is not a residential dwelling for purpose of exemption

The Maharashtra AAR ruled on availability of exemption to renting of hostel facilities to students of a commercial coaching centre on optional basis.

The AAR using common parlance test ruled that such hostels are not residential dwellings based on the below reasons:

• guests are not allowed to stay in the hostel

• hostel is without any kitchen

• is meant for temporary purpose only

However, renting of such hostels may be exempt if declared tariff is less than Rs.1000 per day.

M/s Ghodawat Eduserve LLP


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