TMI Blog2019 (7) TMI 814X X X X Extracts X X X X X X X X Extracts X X X X ..... or leased non-residential property attracting GST @18% (SGST 9% + CGST 9%) of Annexure to Notification No. 11/2017 dated 28.06.2017. - AAR No. RAJ/AAR/2019-20/10 - - - Dated:- 28-5-2019 - J.P. Meena and Hemant Jain Member (State Tax) Present for the applicant: Shri Pankaj Ghiya, (Authorised Representatives) Note: Under Section 100 of the CGST/RGST Act, 2017, an appeal against this ruling lies before the Appellate Authority for Advance Ruling constituted under section 99 of CGST/RGST Act, 2017, within a period of 30 days from the date of service of this order. At the outset, we would like to make it clear that the provisions of both the CGST Act and the RGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the RGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act / RGST Act would be mentioned as being under the GST Act . The issue raised by M/s. Greentech Mega Food Park Pvt. Ltd., Bhadun Road, Village Tehs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... LING IS SOUGHT a. Whether the Lease Agreement between the Applicant Company i.e. the lessor and the Lessee for a period of 99 years is a Sale of immovable property and outside GST and is exempt from levy of GST? b. If the present transaction of giving land on lease of 99 years is taxable under GST, then at what rate and what HSN Code is applicable? 3. PERSONAL HEARING In the matter personal hearing was granted to the applicant on 21.05.2019 at Room no. 2.29 NCRB, Statue Circle, Jaipur. Shri Pankaj Ghiya (Authorised Representative) of applicant appeared for PH. During the PH, he reiterated the submissions already made in the application. He has also submitted additional submission (copy of lease agreement). He further requested that the case may be decided at the earliest. 4. COMMENTS OF THE JURISDICTIONAL OFFICER The Jurisdictional officer (STO, Ward-7, Circle-Kishangarh, Commercial Taxes and SGST, Ajmer) has submitted his comments vide letter dated 11.04.2019 which can be summarized as under: a. The applicant is a person and in the course or in furtherance of its business, it disposes of lands by leasing them out for a consideration as one-time premi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is between the applicant and the business entities to whom the industrial plots are given on a long term lease of 99 years vide separate lease agreements. e. The first thing to be determined in the present case is that whether the said transaction falls under the definition of Supply under GST. The term Supply is defined under Section 7 of the GST Act, 2017, the relevant portion is reproduced hereunder: Section 7 (1) For the purposes of this Act, the expression supply includes:- (a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business; (b) import of services for a consideration whether or not in the course or furtherance of business; (c) the activities specified in Schedule I, made or agreed to be made without a consideration; and (d) the activities to be treated as supply of goods or supply of services as referred to in Schedule II. f. Further, the Schedule II of GST Act, 2017 specify that lease of a industrial place or building is a supply, the relevant portion is reprod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll not without the previous consent in writing of the lessor transfer sub-lease, sublet, relinquish, sub-divide or assign his interest in the demised premises or the building standing thereon or both as a whole and every such transfer assignment, relinquishment, mortgage, sub-division, subleasing or sub-letting shall be subject to condition that the transfer assigns shall be bound by all the covenants and conditions herein contained and be answerable to the lessor in all respect thereof. j. Further while surfing through the website Document of Developed Industrial Plot Allotment Policy of the applicant available in the public domain some of the conditions are reproduced as below-: 1.11 The allotted land cannot be sold or otherwise disposed off by the allottee. The allotted land can only be sub-leased by allottee according to the terms and conditions mentioned in Clause 3 below. 3.1 The Allottee shall be allowed to sub-lease the permissible saleable area allotted land to any third party in accordance with lay-out plan approved by GMFPL for remaining lease period from the date of allotment to allotee on such terms and conditions shall not be beyond the conditions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17 Sl No. Chapter, Section or Heading Description of Service Rate (per cent.) Condition 16 Heading 9972 (i) Services by the Central Government, State Government, Union territory or local authority to governmental authority or government entity, by way of lease of land. Nil - (ii) Supply of land or undivided share of land by way of lease or sub lease where such supply is a part of composite supply of construction of flats, etc. specified in the entry in column (3), against serial number 3, at item (i); sub-item (b), sub-item (c), sub item (d), sub-item (da) and sub-item (db) of item (iv); sub-item (b), sub-item (c), sub-item (d) and sub-item (da) of item (v); and sub item (c) of item (vi). Provided that nothing contained in this entry shall apply to an amount charged for such lease and sub-lease in excess of one third of the total amount charged for the said composite supply. Total amount shall have the same meaning for the purpose of this proviso as given in para ..... X X X X Extracts X X X X X X X X Extracts X X X X
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