The Delhi Authority for Advance Ruling ( AAR ) on 28th March 2018, ruled that 2/3rd of the total amount charged for transfer of land or undivided share of land would be liable to GST.
The applicant, Shri Sanjeev Sharma, plans to engage itself in the development and sale of residential houses, generally floors/ flats in India. He approached the authority seeking an advance ruling on whether GST will be applicable in the aforementioned scenario and whether a sale of the superstructure (which is under construction) att GST. ract GST. The applicant also had expressed his interest in knowing the rates of GST if applicable.
The Authority held that in the case of supply of services by way of construction of a complex, building, civil structure or a part thereof, including a complex or building intended for sale to a buyer, wholly or partly, except where the entire consideration has been received after issuance of completion, or after its occupation, whichever is earlier, GST would be payable.
Further, the authority ruled that even if the agreement between the applicant and the buyer is entered after part of the construction is already completed, the whole of the consideration would be added for payment of GST.
The applicable rate of GST on the said 2/3rd of the total amount is 9% CGST and 9% SGST.
Subscribe Taxscan Premium to view the Judgment
