The Supreme Court of India has dismissed the appeals filed by the State of Karnataka, upholding the decision of the Karnataka High Court that the leasing of residential premises to a lessee for the purpose of using them as a hostel for students and working professionals is exempt from Goods and Services Tax (GST).

The Division Bench comprising Justice J.B. Pardiwala and Justice K.V. Viswanathan held that the exemption under Entry 13 of Notification No. 9/2017-Integrated Tax (Rate) dated 28.06.2017 is “activity specific” and not “person specific.” The Court ruled that the benefit of the exemption is available even if the lessee (an aggregator) does not use the premises for their own residence, provided the property is ultimately used as a residence.

The core legal issue was whether th

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