Booking/selling of plots to be done by the Applicant and Land owners during the development of the township will remain a transaction of sale/transfer of land and thus will not attract GST. It is immaterial whether the said booking/sale is done before completion or after completion of the development work.
Authority for Advance Ruling — GST on Sale of developed Plots – The applicant and land owners entered into agreement for development of Residential Plotted Township/Colony. The applicant is the Technical Partner. The landowners agreed to give 20% of licensed plotted area to Applicant, in consideration of that Applicant will be responsible for obtaining license, to lay roads, sewerage, storm water etc. The applicant sought an Advance Ruling as to whether GST will be applicable on the booking/selling of plots to be done by the Applicants and Land owners during the development (before completion of the development work of the township) of the township, if GST is applicable then what will be the taxable value and applicable tax rate in this case; (ii) whether GST will be applicable on the 20% share of licensed plotted area agreed to be provided by the land Owners to the Applicant (developer), if GST is applicable then what will be the taxable value and applicable tax rate in this case.
Held that:- The Hon’ble Authority for Advance Ruling held that booking/selling of plots to be done by the Applicant and Land owners during the development of the township will remain a transaction of sale/transfer of land and thus will not attract GST. It is immaterial whether the said booking/sale is done before completion or after completion of the development work. As regards another question- it is consideration for the works contract services rendered by the Applicant and therefore, is a service independent of sale of land. The transfer value of the plots will be considered as consideration paid by the land owners for the services rendered by the Applicant for development of their share of land being 'works contract' services attract 18% GST.
Booking/selling of plots to be done by the Applicant and Land owners during the development of the township will remain a transaction of sale/transfer of land and thus will not attract GST. It is immaterial whether the said booking/sale is done before completion or after completion of the development work.
Authority for Advance Ruling — GST on Sale of developed Plots – The applicant and land owners entered into agreement for development of Residential Plotted Township/Colony. The applicant is the Technical Partner. The landowners agreed to give 20% of licensed plotted area to Applicant, in consideration of that Applicant will be responsible for obtaining license, to lay roads, sewerage, storm water etc. The applicant sought an Advance Ruling as to whether GST will be applicable on the booking/selling of plots to be done by the Applicants and Land owners during the development (before completion of the development work of the township) of the township, if GST is applicable then what will be the taxable value and applicable tax rate in this case; (ii) whether GST will be applicable on the 20% share of licensed plotted area agreed to be provided by the land Owners to the Applicant (developer), if GST is applicable then what will be the taxable value and applicable tax rate in this case.
Held that:- The Hon’ble Authority for Advance Ruling held that booking/selling of plots to be done by the Applicant and Land owners during the development of the township will remain a transaction of sale/transfer of land and thus will not attract GST. It is immaterial whether the said booking/sale is done before completion or after completion of the development work. As regards another question- it is consideration for the works contract services rendered by the Applicant and therefore, is a service independent of sale of land. The transfer value of the plots will be considered as consideration paid by the land owners for the services rendered by the Applicant for development of their share of land being 'works contract' services attract 18% GST.