TMI Blog2020 (6) TMI 542X X X X Extracts X X X X X X X X Extracts X X X X ..... HIP located at Adalaj, Gandhinagar, Gujarat; that they are developing a township which consists of many real estate projects within a township; that since the development of the town is a continuous process, the applicant is developing the township in a phased manner; that different schemes or projects are being undertaken by the applicant at different span of time; that at present, Sector-4 of the township is being constructed which is also divided into two parts namely Part-A and Part-B. Part-A is further divided into two phases i.e. Phase-1 and Phase-2. The projects under Phase-1 are (i) Sarvaswa-1 (ii) Sanatan-1 (iii) Sanatan-2 (iv) Stuti-1 (v) Stuti-2 (vi) Swaroop-1 (vii) Swaroop-2 (viii) Swaroop-3 and (ix) Swaroop-4. The projects under Phase-2 are : (i) Sanatan-3 (ii) Swaroop-5 and (iii) Swaroop-7 The projects under Part-B are: (i) Sarvasva-2 (ii) Stuti-3 and (iii) Swaroop-6 which are mainly for small and affordable houses; that it can be seen that 74.08% of the total Floor Space Index (FSI) is used for small houses having carpet area upto 60 sq. metres which can be understood better by seeing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 2 of the Real Estate (Regulation and Development) Act, 2016. Thus, definition of affordable housing is dependent on carpet area and definition of carpet area is dependent on the RERA Act, 2016. 4. The applicant has further submitted that Sector-4 is registered under RERA Act, 2016 as three independent projects/phases: (a) Amba Township-Sector 4 Part-A Phase-1 (b) Amba Township-Sector 4 Part A Phase-2 (c) Amba Township Sector 4 Part-B and have submitted 3 registration certificates issued under RERA Act, 2016; that Part-B of Sector-4 is a separate project in itself and also separately registered under RERA Act, 2016 as a Real Estate Project ; that Part B is independent of other projects within its Phase and Township and has its separate facilities like parking, foyer, electricity connection, water supply etc. The applicant has also submitted a copy of certificate of a Chartered Accountant issued in FORM 3 as required under RERA Act, 2016 showing carpet area of each individual unit in project Part B . 5. The applicant has submitted his view point and submissions on issues on which the advance ruling is sought which is as under: (1) Benefit of reduced r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t-B is a standalone housing project and required to be registered separately; that as notification dated 30.03.2017 is dependent on carpet area as defined under the RERA Act, 2016 it should be considered as denominator to arrive at 50% as required under the notification dated 30.03.2017. (4) As total FSI for the project is 35046.74 square metre and out of that 25961.33 square metres of FSI is used for units having carpet area of not more than 60 square metres, 74.08% of FSI of total Part B of Sector 4 is used for affordable housing and hence Entry No.3(v)(da) is applicable to the appellant. (5) In view of the above facts, it appears to the applicant that the benefit of reduced rate of GST as provided under entry Number-3(v)(da) of the Notification No.11/2017-Central Tax (Rate) as amended by Notification No:01/2018-Central Tax (Rate) dated 25.01.2018, is available to the applicant for houses constructed with a carpet area of not more than 60 square metres per house in Project Part-B of Sector-4 and thus effective rate of GST applicable should be 12% (6% CGST + 6% SGST) and where further deduction of 1/3rd of total amount charged towards value of land is allowable, effecti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... carpet area of 60 square metres per house in an affordable housing project which has been given infrastructure status vide notification of Government of India, in Ministry of Finance, Department of Economic Affairs vide F. No. 13/6/2009-INF, dated 30.03.2017. 9. Relevant portion of the Notification No.11/2017-Central Tax (Rate) dated 28.06.2017 (as amended) reads as under: 3.v.(da) low-cost houses up to a carpet area of 60 square metres per house in an affordable housing project which has been given infrastructure status vide notification of Government of India, in Ministry of Finance, Department of Economic Affairs vide F. No. 13/6/2009-INF, dated the 30th March, 2017; ; 10. Therefore, in order to be eligible for the benefit of the aforementioned notification, the work should be for construction of low-cost houses up to a carpet area of 60 square metres per house in an affordable housing project which has been given infrastructure status vide notification of Government of India, in Ministry of Finance, Department of Economic Affairs vide F. No. 13/6/2009INF, dated the 30th March,2017.(Affordable housing has be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onstruction/development of a building or buildings consisting of apartments, development of land into flats or apartments and selling of the same for a consideration and could also consist of stair cases, lifts, common basements, terraces, parks, play areas, common water tanks and other common facilities, common area, common land and common entrance and therefore, in generic terms, a housing project can be defined as a project having common facilities, common entrance, common area, common land etc. The benefit of the said notification would be available to the applicant subject to the condition that he builds a housing project using 50% or more of the FAR/FSI for dwelling units with carpet area upto 60 square metres. (b) The applicant has also submitted that he is developing a township, which is a continuous process and not limited to one or two phases of development; that entire area of a township cannot be considered for arriving at 50% or more FSI as required under the Notification dated 30.03.2017,; that a project is complete project in itself which is independent of other projects (within township) which are either completed before, during or after completion of Part B of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned above. The representatives of the applicant have themselves mentioned during the course of personal hearing that Part-B is a part of the Sector-4 of the township and shares a common entrance, common facilities and common land with Part-A, which is also a part of Sector-4 of the township. Under the circumstances, it would not be possible to consider Part-B of Sector-4 (of Amba township) as a standalone independent housing project. The applicant during the personal hearing also submitted that the undivided share of land in the project is being determined in terms of Sector-4 and not merely on Stage C and D i.e. Part-B of the project. Therefore, it is very clear that the applicant has himself regarded the entire Sector-4 as a holistic, comprehensive, single housing project and the units in the building being sold as part of this housing project. The applicant himself has been selling the entire project as one and giving undivided share to all buyers irrespective of whether unit is sold in Part-A or Part-B of the project. Therefore, the buyer of unit in Part-A of the project is equitable owner of common areas, common entrance, common facilities and common land as is the buyer o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty of Sr.No.3(v)(da) of Notification No.11/2017-Central tax (Rate) under the provisions of the CGST Act, 2017. Further, we also do not feel the need to borrow the definition of project from the definition of real estate project (as defined in the RERA Act) and make it applicable to a housing project as contended by the applicant. We distinguish the term housing as defined in RERA act from the term housing project as provided in the Notification No.11/2017-Central Tax(Rate) dated 28.06.2017. As discussed earlier, the representatives of the applicants, themselves, have stated during the course of personal hearing that they have received common permission for entire land housing Part-A and Part-B of Sector-4 from Gandhinagar Urban Development Authority and that the entire Sector-4 (of Amba township) is having a common entrance, common facilities, common land etc. which includes Part-A (Phase-I and II) and Part-B. They also stated that all units are being sold in entire project with common undivided share of land establishing that owner of units in Part-A and Part-B have common ownership of undivided share of land. Under the circumstances, it would not be possible to con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate of GST applicable should be 12% (6% CGST + 6% SGST) and where further deduction of 1/3rd of total amount charged towards value of land is allowable, effective total tax rate of 8% on total amount charged including cost of land will be applicable for low cost housing as stated in above entry. In this regard, we would once again reiterate that since Part-B of Sector-4 of township cannot be considered as a standalone housing project since it shares common land, common facilities and common entrance with Part-A of Sector-4 of the township and since 50% of FAR/FSI of the entire housing project of Sector-4 (of Amba townshippvt.ltd.) comprising of Part-A and Part-B has not been used for construction of dwelling units with carpet area of not more than 60 sq.meters (as per the requirement in Notification No.13/06/2009 dated 30.03.2017 of the Government of India, Ministry of Finance, Department of Economic Affairs), the said housing project cannot be considered as an affordable housing project . The applicant, therefore, does not fulfil the conditions as envisaged in Entry No.3(v)(da) of Notification No:11/2017-Central Tax(Rate) dated 28.06.2017 (as amended by Notification No.01/2018-Ce ..... X X X X Extracts X X X X X X X X Extracts X X X X
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