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2023 (12) TMI 150 - AAR - GSTExemption from GST - Letting out of residential property for commercial use - Scope of residential dwelling for the purpose of notification No. 05/2022-Central Tax (Rate) dated 13/07/2022 - Establishing the branch/office of the Lessee - factors to be included in the definition of Residential Dwelling - reverse charge (RCM) or forward charge mechanism - HELD THAT:- Point 4 (a) of the Lease Agreement entered between the Applicant (Lessor) and Lessee i.e. M/s Back Office IT Solutions Pvt. Ltd. (a company incorporated in India within the meaning of Companies Act, 1956), stipulates that the demised premises shall be used solely for commercial purpose by the lessee i.e. for establishing the branch/office. The property in question has been leased/rented for commercial use. So even if the use of said property has not been changed by JDA but since the so called residential dwellings does not remain as such as it being used for commercia l purpose. The said supply of service i.e. renting for commercial use is covered under 997212 and taxable @ 18% and the Applicant i.e. lessor is supposed to pay GST as mentioned above on forward charge basis. The lessee is not required to pay GST under RCM basis in term of Notification No. 05/2022-Central Tax (Rate) dated 18.07.2022. Thus, No the demised premises will not be covered in the definition of residential dwelling in term of Notification No. 05/2022-Central Tax (Rate) dated 13/07/2022 as it being used for commercial use - The important factors to be included in the definition of Residential Dwelling is the purpose for which the dwelling is put to use and the length of stay intended by the users.
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