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2018 (7) TMI 227 - AUTHORITY FOR ADVANCE RULING - MAHARASHTRALevy of GST - Tripartite agreement - taxability of services - scope of 'supply' - Alternate accommodation to be paid to the tenant of the old building by the developer/owner - compensation for alternate accommodation / damages for delayed handover of possession of the new premises. Is GST applicable on the compensation for alternate accommodation to be paid to me (the tenant of the old building) by the developer/owner? - Held that:- For vacating the said premises, the applicant has received/is to receive compensation from the developer - the act of vacating premises for facilitating the developer implies that the applicant has agreed to do an act and such act, of vacating the premises, by the applicant, squarely falls under clause 5(e) of the Schedule II mentioned above and therefore the amounts received by the applicant for having agreed to do such an act, would attract tax liability - Answered in the affirmative. Is GST applicable on the compensation for alternate accommodation / damages for delayed handover of possession of the new premises to be paid to me (the tenant of the old building) by the developer/owner? - Even during the period of redevelopment, the applicant remains a tenant of the owners of the old premises and continues to pay them due rent @ ₹ 5,000/- per month. However in lieu of they vacating the rented premises for redevelopment as per the agreement of redevelopment as referred above, the applicant is agreeing to the obligation to the obligation to refrain from an act or tolerating an act or situation of redevelopment in place of old premises and of not causing hindrance or creating obstacle in the same - the receipt of amounts towards alternate accommodation or delayed possession of premises would be receipt of amounts for doing an act i.e. vacating the premises for redevelopment as well as tolerating the construction cum redevelopment work till possession of new redeveloped premises as per agreement and further for tolerating an act i.e the act of not having completed the redevelopment work within 36 months. In view thereof, the same would definitely be a 'supply' under the GST Act and therefore, there arises an occasion to levy lax under the GST Act on the impugned transactions - Answered in the affirmative. Ruling:- GST is applicable on the compensation for alternate accommodation received by them. GST is applicable on the compensation for alternate accommodation/ damages for delayed handover of possession of the new premises received by them.
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