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TMI Blog2019 (7) TMI 814X X X X Extracts X X X X X X X X Extracts X X X X ..... ct". * The issue raised by M/s. Greentech Mega Food Park Pvt. Ltd., Bhadun Road, Village & Tehsil - Roopangarh Ajmer, Rajasthan 305814 (hereinafter the applicant) is fit to pronounce advance ruling as it falls under the ambit of the Section 97 (2) (d)(e) given as under : d. admissibility of input tax credit of tax paid or deemed to have been paid; e. determination of the liability to pay tax on any goods or services or both; * Further, the applicant being a registered person (GSTIN is 08AAECG8111FIZU as per the declaration given by him in Form ARA-01) the issue raised by the applicant is neither pending for proceedings nor proceedings were passed by any authority. Based on the above observations, the applicant is admitted to pronounce advance ruling. 1. SUBMISSION AND INTERPRETATION OF THE APPLICANT: a. That the Applicant Company is a special purpose vehicle set up for establishing a 'Mega Food Park' pursuant to guidelines framed under the 'Mega Food Park Scheme', 2012 (the "Scheme Guidelines") of the Ministry of Foods Processing Industries, Government of India ("MoFPI"). MoFPI has granted approval to the Applicant Company to set up a Mega Food Park at Village Roopangarh, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m out for a consideration as one-time premium or periodic premium as per convenience. Therefore, if one refers to Schedule II, section 7, then any lease, tenancy, licence to occupy land is a supply of service. Any lease or letting out of a building, including commercial, industrial or residential complex for business, either wholly or partly is a supply of service. The substantive provisions and the Schedule treat the activity as supply of goods or supply of services, particularly in relation to land on a lease, then, the consideration therefore as a premium/one-time premium is a measure on which the tax shall be levied. b. If Government has equity of 50% or more than there will be Nil rate of tax for leasing services of SAC Code 9972. As per the updated version of the Notification No. 12/2017 -Central Tax (Rate) dated the 28th June, 2017 as amended up to 1st January, 2019, the HSN Heading 9972 have nil rate of tax where Upfront amount (called as premium, salami, cost, price, development charges or by any other name) payable in respect of service by way of granting of long term lease of thirty years, or more) of industrial plots or plots for development of infrastructure for finan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oduced hereunder:- 2. Land and Building (a) any lease, tenancy, easement, licence to occupy land is a supply of services; (b) any lease or letting out of the building including a commercial, industrial or residential complex for business or commerce, either wholly or partly, is a supply of services. g. Lease though is not defined explicitly under GST Act, the reference could be drawn from the Transfer of Property Act, 1992 under Section 105 as under: "A lease of immoveable property is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms." We find that the applicant has submitted in submissions that a lease of 99 years is as good as sale but the above definition of lease marks that lease could be of perpetuity. Therefore, quantum of time has no relation in determination of lease or sale. h. Reference could also be drawn from Builders Association of India vs UOI, in the High Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment letter/Lease Agreement of allottee. From the above facts, we observe that the agreement made between the applicant and the lessee for long term of 99 years is for lease agreement with many restrictions and has no right to further sale the allotted plot. In the sale deed purchaser becomes the absolute owner of the plot and is not dependent on the lessor for renewal or extension of the lease period. k. That the applicant has submitted that said transaction is required to be registered and stamp duty on lease charges treating it as Sale of immovable property is to be paid on the said consideration. The said transaction amounts to transfer of rights in an immovable property and hence sale which is outside the scope of GST. l. We observe that applicant's submission is not tenable as the e-challan dated 3.1.2017 for Rs. 415740/- submitted by the applicant along with the lease agreement of Registration and Stamps department Govt. of Rajasthan is specifically for registration of lease agreement. Further we also observe that stamp duty charged by the Registration and Stamp department of the state govt. varies from one state to another. We also observe that merely by charging stamp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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