Home Case Index All Cases GST GST + AAR GST - 2019 (11) TMI AAR This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (11) TMI 994 - AAR - GSTLevy of GST - sale of developed plots for consideration - revenue sharing basis - principal supply/predominant supply - applicability of Rule 31 of CGST Rules - Taxability in terms of serial number 5 of Schedule III of the CGST Act, 2017 - HELD THAT:- On the basis of provisions of the agreement it would be in order to conclude that activities undertaken by the applicant are not qualified to be covered under entry number 5 of Schedule Ill of the said Act. Thus the activities undertaken by the applicant amount to a supply of service - the activities undertaken by the applicant, as envisaged in the agreement placed before the Authority, amount to a supply of service to the landowners and is liable to be taxed appropriately under the provisions of the CGST/KSGST Acts. Applicability of provisions of Rule 31 of CGST Rules - ascertaining the value of land and supply of service for the purpose of taxable value - HELD THAT:- Consideration for a service is the total value that the service provider gets in the deal and not what the service provider expends for the provisioning of the service. The total gain to the applicant or the total amount accruing to the applicant for the services is 25% of the amount at which the plots are sold. It has already been emphasised and held that the applicant has no right in the title of the land and therefore the applicant cannot be considered as the sellers of the plots. Their role is limited to aiding and assisting the landowners in the sale of the plots. They are only service providers in the whole process, be it development of the raw land into residential plots or their sale after the development. Therefore the entire amount received by them is liable to be taxed. Thus, Rule 31 applies in the instant case and the value of the supply is equal to the total amount received by the applicant, which is equal to 25% of the market value of each plot.
|