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2022 (9) TMI 778 - AAR - GSTLevy of GST - time of supply - transfer of land or transfer of 'development rights' to the developer by the landowner is to be considered as receipt of consideration by the developer - Applicability of N/N. 04/2018-CT (Rate) dt.25.01.2018 - liability to pay GST or service tax as applicable arises on the developer immediately on receipt of development rights or immediately on conveyance of the flats to be constructed by way of an allotment letter. HELD THAT:- Transfer of development rights by the landowner to the developer is consideration received by such developer for supply of construction service. - The liable to pay GST by the developer-promoter shall arise at the time of transfers possession or right in the constructed complex or constructed flats and not at the time of receipt of development rights. The tax on the portion of constructed area shared with the land owner-promoter has to be paid by ‘developer-promoter’. The applicant i.e., the land owner-promoter will claim such tax as ITC as described above whenever he makes further sale of such property before issuance of completion certificate. Further according to the conditions laid down in Notification No. 04/2018 the liability to pay tax on consideration received by the developer-promoter in form of development rights shall arise at a time when such developer-builder transfers possession or right in the constructed complex. That is after the completion of the construction of a civil structure the time of supply arises when the right or possession in such constructed complex is transferred to the land owner-promoter.
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