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Transition Credit - Goods and Services Tax - GSTExtract We are into construction of residential flats and in the month of June'17 we have entered into JDA ( Joint development Agreement) with the land owners where in out of the total flats to be constructed few of them are ear marked/allocated. This has taken place on 23rd Jun'17 and as per Rule 3 of point of taxation of ST, the liability arises on the services provided to the land owner at the time of receipt of advance in the form of Land/Development rights. Since we have received the consideration (land/development rights) before construction of the flats, this is treated as Advance and ST has been paid accordingly @ 4.5% (considering 70% abatement, 26/2012 ). My query is As per sec.142(11)(c) of CGST act (Transition Provisions), is it mandatory to avail this ST paid as transition credit and pay GST @ 18% on the total value under GST. The actual supply ie. construction of flats and sharing the final flats ( as agreed in JDA) to land lord will happen after 2-3 years. Can any expert give clarity ?? If we have pay under GST 18% it will be huge outflow....
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