# Section 7(1)(aa): Supply between Association/Club and its Members
## The Provision
Any activity or transaction involving supply of goods or services:
- Between a person OTHER THAN AN INDIVIDUAL (e.g., association, club, society) AND its members or constituents, or vice versa
- For cash, deferred payment or other valuable consideration
Is treated as SUPPLY.
## The Explanation — Overriding Doctrine of Mutuality
### What is the Doctrine of Mutuality?
A pre-GST common law doctrine: 'A person cannot make a profit from himself.' Therefore, transactions between a club and its members were treated as transactions with oneself — not commercial supplies.
### How Section 7(1)(aa) Overrides It
The Explanation to Sec 7(1)(aa) deems the association/club and its members as SEPARATE PERSONS, and transactions between them are deemed supply.
The explanation begins with a non-obstante clause, giving overriding effect over:
- Any existing law
- Any court judgment
- Any order
that would otherwise apply the doctrine of mutuality.
### Important — Retrospective Intent
This provision was inserted to overcome the Supreme Court's ruling in Calcutta Club Ltd. case, ensuring clubs/associations are taxable on transactions with members.
## Practical Examples
| Transaction | Treatment |
|---|---|
| RWA supplies air-conditioners to members at concessional rates | SUPPLY |
| RWA collects maintenance charges from members | SUPPLY |
| Gymkhana club provides golf access for member fees | SUPPLY |
| Trade association charges annual membership subscription | SUPPLY |
## Why 'Other than an Individual'?
An individual cannot have 'members' in the legal sense. Section 7(1)(aa) targets:
- Companies, Firms, HUFs, LLPs, Trusts, Co-operative societies, Clubs/associations
## Memorising Anchor
'Club & Member = Distinct Persons under GST' — doctrine of mutuality is dead under GST.