Levy of GST— In the instant case, the applicant, seeking an advance ruling in respect of the following questions.-

1. Whether the transfer of land, held under lease by FDCM, towards Kolsapada Minor Irrigation Project is supply of service?

2. Whether exemption under Entry No 3. Of Notification No. 12/2017 Central Tax (Rate), dated 28.06.2017 will be applicable on the amount of compensation received by FDCM against transfer of land held under lease for Kolsapada Minor Irrigation Project?

As an owner, MSFR Department has leased the land to the applicant. The applicant is not the owner of the land. Now, the MSFR Department has asked the applicant to hand over a part of the land to the Irrigation Department as mentioned in the application. Thus, in respect of the land to be transferred to the Irrigation Department, as and when the transfer is done it would have the effect of making MSFR Department as the lessor and the Irrigation Department as the lessee (with the applicant being nowhere in the picture) and presumably the lease rent if any, would be paid by the Irrigation Department to MSFR Department.

Held that— As per 5 (e) of Schedule III, agreeing to the obligation to do an act amounts to supply of services. In the subject case, the applicant has agreed to do an act i.e. the applicant has agreed to relinquish its lease right on the said land in favour of Irrigation Department on the directions of the owner of the land i.e. MSFR Department. Thus the said action of the applicant is nothing but supply of services under the GST Laws and the said supply is to MSFR department for which compensation is received from the Irrigation department.

In view of non-submissions of details on this aspect by the applicant, the second question i.e. “Whether exemption under entry No 3. Of Notification No. 12/2017 Central Tax (Rate), dated 28.06.2017 will be applicable on the amount of compensation received by FDCM against transfer of land held under lease for Kolsapada Minor Irrigation Project” cannot be answered.