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2020 (1) TMI 740 - AAR - GSTBenefit of concessional rate of tax - dwelling units at Joyville, Virar - low cost houses - benefit of concessional rate would be available to common amenities such as club house, swimming pool and amenities of like nature - ongoing project - whether the construction services provided by the applicant under the subject qualifies for the reduced GST rate of 12% as provided in Sr. No. 3 - item (v) - sub item (da) of Notification No. 01/2018-CT (Rate) dated 25.01.2018? - HELD THAT:- The applicant’s case is covered under the tax rate of 12% (8% GST after deducting value of land), under Heading 9954 (Construction Services), (v) (da) of above mentioned Notification No. 11/2017, as amended, since the project undertaken by applicant falls under the definition of “Affordable Housing”. The benefit of reduced rate would be available to applicant only in the cases of supply effected after 25.01.2018 i.e. the date on which Notification 1/2018-Central Tax (Rate) was issued and only in respect of dwelling units having carpet area less than 60 sq. mtrs. Whether the benefit of concessional rate would be available to common amenities such as club house, swimming pool, etc., except corpus fund subscription and share application money, as mentioned in Annexure D of the agreement for sale? - HELD THAT:- Such services will qualify as composite supply of works contract service, where the principal supply would be, construction services. Accordingly, the rate applicable to the principal supply will also be applicable to common amenities. The word ‘housing project’ cannot be confined only to dwelling units, it would also include within its fold, other common amenities, structures, etc. The jurisdictional office has also opined that Common amenities form part of the overall construction service and are always naturally bundled when offered to the customer. Therefore, such services will qualify as composite supply of works contract service wherein provision of construction services is the principal supply. Accordingly, the rate applicable to the principal supply will also be applicable to common amenities - the concessional rate of 12% will be charged on such amounts collected by the applicant from buyers of units with area less than 60 sq mtrs. and GST @ of 18% will be charged on such amounts collected by the applicant from buyers of units with area greater than 60 sq mtrs. Whether the project of the Applicant at Joyville, Virar qualifies as an ongoing project under Notification No. 3/2019-Central Tax (Rate) dated 29.03.2019 so as to be eligible for the concessional rate of benefit under Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017? - HELD THAT:- The project of the Applicant at Joyville, Virar qualifies as an ‘ongoing project under Notification No. 3/2019-C.T. (Rate) dated 29.03.2019. Further, the jurisdictional officer has also agreed that subject project is an ‘ongoing project’ as per said Notification No. 3/2019-Central Tax (Rate) dated 29.03.2019. What would be the rate of Goods and Services Tax on the units at Joyville, Virar which do not qualify the criteria of ‘low cost houses’? - Whether 12% or 18% tax is to be levied on those units? - HELD THAT:- The applicant’s case is covered under the concessional rate of 12% (8% GST after deducting value of land), under Heading 9954 (Construction Services), (v) (da) of above mentioned Notification No. 11/2017, as amended since the project undertaken by them fails under the definition of “Affordable Housing” - The benefit of reduced rate would be available to them only in the cases of supply effected after 25.01.2018 i.e. the date on which Notification 1/2018-Central Tax (Rate) was issued and the benefit of this reduced rate would be applicable in case of only those flats which are of carpet area upto 60 sq mtrs., in this scheme which is covered in the category of affordable housing. In case of other flats which have carpet area more than 60 sq.mtrs. applicant would be required to pay GST at normal applicable rate i.e. @18% GST.
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