TMI Blog2022 (8) TMI 365X X X X Extracts X X X X X X X X Extracts X X X X ..... him in the statement of facts submitted separately on 21.12.2021 - This notification offers the promoter an option to shift to the new scheme or to continue under the earlier scheme. Under the new scheme, for residential apartments, the developer promoter has to pay CGST as well as SGST @0.5% without ITC for affordable residential apartments and 2.5% without ITC for other residential apartments and reverse the input tax credit available in the credit ledger as on 31.03.2019. However if the developer promoter intends to continue under the old scheme and avail ITC, he has to submit a declaration before 20.05.2019 to the jurisdictional authority. In the case of the applicant, it appears they have not opted for the old scheme, hence they fall under new scheme and therefore have to pay tax @0.5% for CGST as well as SGST for affordable residential apartment and @ 2.5% CGST SGST for other residential apartments without availing ITC. The tax on the portion of constructed area shared with the land owner-promoter has to be paid by applicant as his liability in the capacity of developer-promoter and not as Reverse charge mechanism. The law regarding services by an employee to the emp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to both CGST Act and TGST Act. 3. It is observed that the queries raised by the applicant fall within the ambit of Section 97 of the GST ACT. The Applicant enclosed copies of challans as proof of payment of Rs. 5,000/- for SGST and Rs. 5,000/- for CGST towards the fee for Advance Ruling. The concerned jurisdictional officer also raised no objection to the admission of the application. The application is therefore, admitted 4. Brief facts of the case: M/s. Sri Bhavani Developers are into constructions of residential buildings and have opted for new tax scheme as per Notification No.3/2019, dt: 29.03.2019. The applicant submitted that, in a particular case they have entered into JDA with one Mr.Sadanda Chary for construction of residential units at Moulali. The Joint Development agreement between land Owner and Builder was entered on 7 December 2017 and subsequently supplementary development agreement was entered on 17 December 2018 on area sharing basis. And that they have started the work however that they didn't have any bookings as on 31-03-2019 and therefore they require clarification if they are falling into other than Ongoing Projects as per the notificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /2019 dated: 29.03.2019. The Notification No. 03/2019 makes a distinction between Ongoing project in clause (xx) of Para 4 and Other than ongoing project in clause (xxviii) of Para 4. Accordingly Other than ongoing project means a project which commences on or after 01.04.2019. Therefore the project undertaken by the applicant does not fall under this definition as claimed by him in the statement of facts submitted separately on 21.12.2021. This notification offers the promoter an option to shift to the new scheme or to continue under the earlier scheme. Under the new scheme, for residential apartments, the developer promoter has to pay CGST as well as SGST @0.5% without ITC for affordable residential apartments and 2.5% without ITC for other residential apartments and reverse the input tax credit available in the credit ledger as on 31.03.2019. However if the developer promoter intends to continue under the old scheme and avail ITC, he has to submit a declaration before 20.05.2019 to the jurisdictional authority. In the case of the applicant, it appears they have not opted for the old scheme, hence they fall under new scheme and therefore have to pay tax @0.5% for CGST ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e GST is payable on TDS, FSI or long term lease of land by developer-promoter under reverse charge. The law regarding services by an employee to the employer in the course of or in relation to his employment enumerated in Schedule III to CGST Act, 2017 remains unchanged. Therefore tax will not be attracted for labour engaged on daily basis or employees etc., if the service is rendered in the course of such an employment. However manpower supply or labour supply services by manpower supply agency falls under SAC 98519 and is taxable @18%. This tax has to be paid by the manpower supply agency. Further the applicant has averred that they are entering into (2) different agreements with their prospective buyers, one for the semi-finished structure which is offered in the sale deed and other for the completion of semi-finished structure. In this connection it is informed that the Hon ble High Court of AP in the case of M /s. Omega Shelters (P) Limited Vs Assistant Commissioner (LTU) Secunderabad, (2015) 83 VST 51 has considered similar facts and law positions and held that the rate of tax applicable is the same for the total consideration received for the initial agreement for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 60Sq Mts), and Non affordable flats (Carpet Area is more than 60Sq Mts), can different rate of tax be adopted for different units, i.e., GST 1% in case of affordable Units and 5% in case of Non affordable units based on the Carpet area? Yes 6. That, the customer is entering into two types of agreements at the time of selling the semi finished residential flat. c) SALE AGREEMENT and d) Completion of semi finished works called WORK ORDER , In such case what is the rate of tax for: c) For SALE DEED @ 5% d) For WORK ORDER @ 18% or 12% or 5%. Whether they are eligible for ITC in case of 18% /12%? What is the tax rate in case of affordable housing project in the above situation? If the initial contract for land and building, even if entered through (2) different un severable agreements, constitutes a single contract and hence will attract tax @0.5% for affordable housing and @2.5% for other housing under CGST SGST respectively without ITC. However any other agreement which is beyond the scope of initial agreement and is a severable agreement vis- -vis the initial agreement then the const ..... X X X X Extracts X X X X X X X X Extracts X X X X
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