TMI Blog2019 (8) TMI 395X X X X Extracts X X X X X X X X Extracts X X X X ..... he applicant has transferred the possession of the land owner's share of flats or not. Hence it is inferred that the possession of the land owners share of flats has not been given to the land owner. Therefore the aid possession obviously would happen during GST regime and hence would attract applicable GST - In terms of N/N. 4/2018-CT(Rate) dated 25-1-2018 the time of supply would fall under the purview of GST law. The Applicant is liable to pay GST towards work executed under Joint Development Agreement on Land owner's portion, on the value to be arrived at in terms of para 2 of the Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 at the time of transfer Of possession of the land owners' portion of the fiats. - AAR KAR ADRG 17/2019 - - - Dated:- 25-7-2019 - Sri. Harish Dharnia, And Dr. Ravi Prasad M.P. Member Represented by Sri Sanjay M Dhariwal, CA Authorised Representative ORDER UNDER SECTION 98(4) or THE CENTRAL GOODS SERVICES TAX ACT, 2017 AND UNDER 98(4) OF THE KARNATAKA GOODS SERVICES TAX ACT, 2017 1. M/s Durga Projects Infrastructure Private Limited, (called as the 'Applicant' hereinafter), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is in the course of furtherance of business. Further in terms of Section 2(31) of the CGST Act 2017 consideration in relation to supply includes money or otherwise. Hence the supply for the consideration other than money also squarely falls under the definition of Supply . Therefore construction of a building by developer for land owner in exchange of undivided interest in land falls under the definition of Supply and attracts tax under GST. 3.5 The Applicant, with regard to valuation for the purpose of payment of GST on land owner's built up area submits that tax shall be levied under Section 9 and the value be determined under Section 15 of the CGST/KGST Act 2017. The applicant, quoting Section 15 of the CGST/KGST Act 2017, stated that the contractual understanding between the supplier and recipient is essential in order to impose tax under GST and in terms the said understanding only the provisions of supply and determination of consideration are governed. Therefore GST can't be imposed in the absence of a contractual agreement. The land is the consideration for the work executed to the land owner and hence there exists quid pro quo . Further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Commissioner Vs Shiv Kumar Joshi 2000 (1) SCC 98 = 1999 (12) TMI 770 - SUPREME COURT (i) Copies of some Joint Development Agreements 5. FINDINGS DISCUSSION 5.1 We have considered the submissions made by the Applicant in their application for advance ruling as well as the submissions made by Sri. Sanjay M Dhariwal, Chartered Accountant and authorised representative of the applicant during the personal hearing. We have also considered the issues involved, on which advance ruling is sought by the applicant and relevant facts. 5.2 At the outset, we would like to make it clear that the provisions of both the CGST Act and the KGST 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 provisions under the KGST Act. 5.3 The Applicant seeks advance ruling in respect of the following question: Whether Applicant is liable for GST towards work executed under JDA on land owner's portion where work commenced during pre-GST and continued under GST Law. If ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5.01.2018, which notifies the following classes of registered persons, namely:- a) Registered persons who supply development rights to a developer, builder, construction company or any other registered person against consideration, wholly or partly, in the form of construction service of Complex, building or civil structure; and b) Registered persons who supply construction service of complex, building or civil structure to supplier of development rights against consideration, wholly or partly, in the form of transfer of development rights, as the registered persons in whose case the liability to pay central tax on supply of the said services, on the consideration received in the form of construction service referred to in clause (a) above and in the form of development rights referred to in clause (b) above, shall arise at the time when the said developer, builder, construction company or any other registered person, as the case may be, transfers possession or the right in the constructed complex, building or civil structure, to the person supplying the development rights by entering into a conveyance deed or similar instrument (for exa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n received in the form of development rights, shall arise at the time when the said developer, builder, Construction company or any other registered person, as the case may be, transfers possession or the right in the constructed complex, building or civil structure, to the person supplying the development rights by entering into a conveyance deed or similar instrument (for example allotment letter). 5.11. In the instant case it is apparent from the advance ruling application filed by the applicant and also an admitted fact that the construction commenced during pre-GST regime and continued thereafter also, Further the applicant has not furnished any information as to whether the applicant has transferred the possession of the land owner's share of flats or not. Hence it is inferred that the possession of the land owner's share of flats has not been given to the land owner. Therefore the said possession obviously would happen during the GST regime and hence would attract applicable GST. In terms of Notification No.4/2018-Central Tax (Rate) dated 25.01.2018 the time of supply would fall under the purview of GST law. Therefore the tax liability arises not part ..... X X X X Extracts X X X X X X X X Extracts X X X X
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