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2021 (12) TMI 39 - AAR - GSTLevy of GST - sale of developed plot of land for which consideration is received before the issuance of completion certificate - Classification of supply - supply of goods or supply of services or both - applicable rate of GST - HSN or SAC of GST - Entry No of the Notification on the supply or activities or transactions? - actual value of Land as per Government Guidelines can be excluded from the Total Consideration (or Gross amount charged) or not - benefit of Para-Z of Notification No 11/2017 dated 28-06-2017 regarding l/3rd abatement/exclusion on account of the value of transfer of land or undivided share of land from the total amount charged. HELD THAT:- The intention of the legislature is thus clear regarding exclusion of land from the purview of GST and accordingly, it is beyond doubt that there is no GST on the sale of land per se by excluding sale of land from the definition of supply - Once it is established that GST is not leviable on sale of land on account of sale of land not being supply, we need to examine what constitutes land and whether in the given facts of the case, the supply is of something other than land. It is pertinent to note that the moot question here is whether there is sale of anything other than land since the query stales that the plot has been sold after carrying out the development activities or providing amenities such as Drainage line, water line, electricity line, land levelling, and common facilities viz road and street light etc. The development work done on the land is for the whole parcel of land and not for a given plot, which is sold to the customers. The title in the common area and amenities does not belong to the owners of the plot but rests with the Urban Local Body as per the applicable laws. Further, there are easement rights and right of way to be granted, which further show that there is no collective ownership of the common amenities with the plot owners or any association of such plot owners - the provision of common amenities such as Drainage line, water line, electricity line, land levelling, and common facilities viz road and street light etc to the buyers of the plot of land does not have any bearing on the taxability or otherwise of the sale of plot after carrying on the development work for providing amenities. The question raised by the applicant is qualified by the phrase “issuance of completion certificate”. In this regard, we have to say that from the discussion above, it is clear that development of land is not akin to construction of a complex or building. The concept of obtaining a completion certificate is applicable to the construction of a complex or building and not to development of land, so far as GST is concerned. Therefore, it is immaterial whether any money is received by the applicant from prospective buyers before development of plots is completed and a completion certificate is received by the applicant from the appropriate authority - Principles of interpretation of Statutes, Deeds and Documents refer to an Absurdity Limit, which states that a statute cannot be interpreted literally if it would lead to an absurd result. There is no concept of obtaining completion certificate in case of development of land since development of land is not akin to construction of a building or a complex. Therefore, if development and sale of such developed land by a person is treated to be a taxable supply distinct from sale of land, then each subsequent sale of such parcel / plot of land would also become a taxable supply which makes the interpretation give an absurd result. The sale of developed land, by the applicant as per the facts provided by him where the development work is limited to providing common amenities (common drainage, water line, electricity line, land levelling, road and street light) and no development work will be done by the applicant after the sale of the developed land and if no advance from the customer for undertaking development activities is taken then it does not constitute a supply within the meaning of Section 7 of the GST Laws and therefore GST is not applicable on such sale - other questions need not be answered as has become absurd.
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