The Jammu and Kashmir High Court has held that Goods and Service Tax (GST) is applicable on rental income received by a hotel owner whose premises have been hired by the Department of Home, Government of Jammu and Kashmir.
The bench of Justice Sanjeev Kumar and Justice Sanjay Parihar has issued clear directions affirming that the petitioner is legally liable to pay GST on the rental income received from the Department of Home. Consequently, the petitioner must obtain proper registration under the CGST and Jammu and Kashmir GST Acts and ensure the applicable tax is deposited with the concerned GST authorities.
The Court also held that the Department of Home, Government of J&K, shall bear the financial burden of the prescribed GST in addition to the rent it is already paying for the accommodation. The Department has been directed to commence GST payments from August 2025.
The judgment further stressed the need for the Home Department to set up a dedicated Rent Assessment Committee. The Committee is expected to revise the long-standing rental rates applicable to hotel accommodations hired by the department.
The Court ordered that the petitioner complete the GST registration process by July 31, 2025, to ensure smooth collection and remittance of the applicable tax.
Case Details
Case Title: Mushtaq Ahmad Bhat Versus U.T Of Jammu & Kashmir
Case No.: WP(C) No. 2067/2024
Date: 07.07.2025
Counsel For Petitioner: Mohsin Qadri, Sr. AAG
Counsel For Respondent: Maha Majeed, Assisting Counsel
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