Applicant is required to deduct one third value of land for the transaction of sale of residential/ commercial property with undivided rights of land.
Appellate Authority for Advance Ruling —–Value of land – The applicant sought an advance ruling as to what will be the value of supply for the transaction of sale of residential/ commercial property with undivided rights of land; in the case of construction of residential/commercial complex, the builder charges an amount which is inclusive of land or undivided share of land. As per Not No. 11/2017-CT (Rate) and 08/2017-I.T (Rate) both dated 28.06.2017 the land value is deemed to be one third (33.33%) of the total amount (i.e. value including land value) and GST is payable on balance amount. But in his case the value of Land is clearly ascertainable, in that case actual cost of Land can be deducted for the for the purpose of arriving at the taxable value of supply. The AAR held that the value to be arrived in terms of deeming provision of Para 2 of Notification no. 11/2017-CT (Rate) dated 28.06.2017, as amended by Noti. No.01/2018-C.T. (Rate), dated 25-1-2018. The applicant is required to deduct one third value of land or undivided shares from the total value charged for the subject supply in terms of this notification. Being aggrieved by the aforesaid ruling, the appellant has filed the present appeal.
Held that:- The Hon’ble Appellate Authority for Advance Ruling rejected the appeal.
Applicant is required to deduct one third value of land for the transaction of sale of residential/ commercial property with undivided rights of land.
Appellate Authority for Advance Ruling —–Value of land – The applicant sought an advance ruling as to what will be the value of supply for the transaction of sale of residential/ commercial property with undivided rights of land; in the case of construction of residential/commercial complex, the builder charges an amount which is inclusive of land or undivided share of land. As per Not No. 11/2017-CT (Rate) and 08/2017-I.T (Rate) both dated 28.06.2017 the land value is deemed to be one third (33.33%) of the total amount (i.e. value including land value) and GST is payable on balance amount. But in his case the value of Land is clearly ascertainable, in that case actual cost of Land can be deducted for the for the purpose of arriving at the taxable value of supply. The AAR held that the value to be arrived in terms of deeming provision of Para 2 of Notification no. 11/2017-CT (Rate) dated 28.06.2017, as amended by Noti. No.01/2018-C.T. (Rate), dated 25-1-2018. The applicant is required to deduct one third value of land or undivided shares from the total value charged for the subject supply in terms of this notification. Being aggrieved by the aforesaid ruling, the appellant has filed the present appeal.
Held that:- The Hon’ble Appellate Authority for Advance Ruling rejected the appeal.