AAR: Section 8 Company Supplying Sponsorship Services Is a “Body Corporate”; GST Payable Under Forward Charge:

AAR: Section 8 Company Supplying Sponsorship Services Is a “Body Corporate”; GST Payable Under Forward Charge The Mining, Geological & Metallurgical Institute of India (MGMI), a long-standing professional association formed in 1909 as a company limited by guarantee under the old Companies Act of 1882, sought a ruling from the West Bengal Authority for Advance Rulings (AAR) on how GST applies to its sponsorship receipts. MGMI now operates as a Section 8 company under the Companies Act, 2013, and also enjoys registration under Section 12A of the Income-tax Act. Its work largely revolves around hosting technical programmes, conferences, seminars, and large-scale mining exhibitions, through which it earns membership income, sponsorship funds, delegate fees, and publication revenue. Main Issue: Whether MGMI falls within the expression “body corporate” for purposes of the reverse-charge mechanism on sponsorship services under Notifications 10/2017-IGST (Rate) and 13/2017-CT (Rate), as amended on 16 January 2025. Authority Held: The West Bengal AAR held that MGMI squarely fits the definition of a “body corporate” under Section 2(11) of the Companies Act, 2013. This is the very definition incorporated into the relevant GST notifications through Explanation (b). The Authority rejected MGMI’s argument that its non-profit character, Section 8 status, or charitable registration under the Income-tax Act should somehow remove it from the statutory definition.

The AAR pointed out that the law carves out only two exclusions, co-operative societies and entities specifically notified by the Central Government. MGMI is neither. Once incorporated as a company, it remains a “body corporate” for GST purposes, regardless of the fact that it operates without a profit motive. The Authority also declined to treat MGMI as a “trust” under GST law. Merely holding charitable registration does not alter the legal form in which it is constituted. Therefore, the MGMI must pay GST on its sponsorship income under the forward-charge mechanism.

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