GST on REAL ESTATE SERVICES.pdf

GST on REAL ESTATE
R N JHA
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R N JHA ADDITIONAL ASSISTANT DIRECTOR

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STATUTORY
PROVISIONS

Section 7 of CGST ACT
R N JHA ADDITIONAL ASSISTANT DIRECTOR 4

SCHEDULE II : SR.No. 5(b)
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SCHEDULE III: SR. NO. 5

CONSTRUCTION OF A COMPLEX, BUILDING, CIVIL
STRUCTURE OR A PART THEREOF, including a
complex or building intended for sale to a buyer,
wholly or partly, except where the entire
consideration is received after issuance of
certificate of completion by a competent authority
or after its first occupation, whichever is earlier.
5(b)
SCHEDULE II
Explanation: The expression "competent authority" means the Government or any authority authorised to
issue completion certificate under any law for the time being in force and in case of non-requirement of
such certificate from such authority, from any of the following, namely:-
(A) architect registered with the Council of Architecture constituted under the Architects Act, 1972; or (20
of 1972.)
(B) chartered engineer registered with the Institution of Engineers (India); or
(C) licensed surveyor of the respective local body of the city or town or village or development or planning
authority;
(II) the expression "construction" includes additions, alterations, replacements or remodelling of any
existing civil structure;

CONSTRUCTION OF A COMPLEX, BUILDING, CIVIL
STRUCTURE OR A PART THEREOF.
➢ consideration received before
certificate of completion by a
competent authority
5(b)
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SCHEDULE II SR.NO.5(b)
"competent authority" - Government or any authority authorised to issue
completion certificate under any law
in case of non-requirement of such certificate from such authority, from any of the
following:-
(A) architect
(B) chartered engineer
(C) licensed surveyor of the local body;
"construction" includes additions, alterations, replacements or
remodelling of any existing civil structure

SCHEDULE III
• Schedule III provides the list of transaction which should be
treated neither supply of goods nor supply of service, which
includes:
a) Sale of Land
b) Sale of Building, i.e. residential or commercial units where
completion certificate is received.
➢Hence, where completion certificate is not received in case of
residential or commercial units, GST will be applicable.
10

Completed Real estate projects
• As per Schedule III of GST law, No GST is leviable on Sale
of completed projects.
• It means if a developer sells a flat/house after
completion certificate is obtained from prescribed
authority, then no GST is charged.
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TRANSACTION & GST LEVIABILITY
Transaction Whether GST is payable ?
Sale of Land NO
Sale of Building
Where entire consideration is received after
issuance of Completion Certificate
NO
Where full or part consideration is received
before issuance of Completion Certificate
YES
Works Contract Services YES
12

EXAMPLE
PAYMENT RECEIVED
BEFORE COMPLETION
CERTIFICATE
PAYMENT RECEIVED
AFTER COMPLETION
CERTIFICATE
GST WILL BE LEVIED
ON
NIL Rs. 50,00,000/- NIL
Rs. 40,00,000/- Rs. 10,00,000/- Rs. 50,00,000/-
50,00,000 NIL Rs. 50,00,000/-
13

Meaning of 'first occupation'
• As per para 5 of Schedule III read with para 5(b) of Schedule II of CGST Act, If entire
consideration is received 'after issuance of completion certificate/occupancy certificate by
the competent authority or its first occupation whichever is earlier', the promoter (builder
or developer) is not liable to pay GST, even if completion certificate or occupancy certificate
is not obtained from authorities.
• The words 'after its first occupation' are confusing. 'Occupation' by whom? The
'occupation' should be of that particular apartment which is being sold or any apartment
in that complex?
➢ As per, 'first occupation' means 'first occupation' of the project in accordance with laws,
rules and regulations of State/Central Government or any other authority. Thus, mere
staying in the apartment before obtaining completion/occupancy certificate will not be
considered as 'first occupation'. [FAQ (Part I) No. 29 issued by CBI&C vide circular F No.
354/32/2019-TRU dated 7-5- 2019]
➢ Thus, the FAQ (Part I) treats 'first occupation' as equivalent to completion/occupancy
certificate. If so, the words 'or its first occupation whichever is earlier' become redundant.
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CLASSIFICATION

Scheme of Classification of Services
• The Scheme of Classification of Services
adopted for the purposes of GST is a modified
version of the United Nations Central Product
Classification (UN CPC).
▪ UN CPC (Central Product Classification) by United
Nations Statistical Commission whose list of services
is akin to the Annexure to Notification No 11/2017-
CT Rate dated 28.06.2017.
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Authority of classification of services
• Notification No. 11/2017-Central Tax (Rate) New
Delhi, the 28th June, 2017.
▪ Para 4(ii) Explanation.- For the purposes of this
notification-
• Reference to “Chapter”, “Section” or “Heading”, wherever they
occur, unless the context otherwise requires, shall mean
respectively as “Chapter, “Section” and “Heading” in the
annexed scheme of classification of services (Annexure).
17

Classification of services: Six digits
• The classification is based on a six digit format (example- 995411):
Chapter : Chapter is of 2 digits(99):
Section : Section is of 1 digit after Chapter (5)
Heading : Heading is of 4 digits; 1 digit after Section (9954)
Group: Group is of 5 digits; 1 digit after Heading ( 99541)
Service Code (Tariff): Service code is of 6 digits (995411)
9 9 5 4 1 1
Chapter Section Heading Group Tariff item
Heading
Service Tariff Item( Service Code)
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EXEMPTION

CONSTRUCTION SERVICE: Exemption
Sl. No. Chapter, Description of Services Rate
(per cent.)
Condition
10 Heading
9954
Services provided by way of pure labour
contracts of construction, erection,
commissioning, installation, completion, fitting
out, repair, maintenance, renovation, or
alteration of a civil structure or any other
original works pertaining to the beneficiary-
led individual house construction or
enhancement under the Housing for All
(Urban) Mission or Pradhan Mantri Awas
Yojana.
Nil NIL
Not. No. 12/2017-CT (rate) dated 28.06.2017 effective from 01.07.2017
27

CONSTRUCTION SERVICE: Exemption
Sl. No. Chapter, Description of Services Rate
(per cent.)
Condition
11 Heading
9954
Services by way of pure labour
contracts of construction, erection,
commissioning, or installation of
original works pertaining to a single
residential unit otherwise than as a
part of a residential complex.
Nil NIL
Not. No. 12/2017-CT (rate) dated 28.06.2017 effective from 01.07.2017
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Purchaser of apartment
• Purchaser of apartment is not liable to tax even if he sales before
occupation or completion –
• The Purchaser of apartment is not liable to tax even if he sales before
occupation or completion, for two reasons –
• (a) He is not supplying construction service, as deeming
provision requires supply of construction service
• (b) He is not in the business of sale of apartments.
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CONSTRUCTION
SECTOR
FROM 01.07.2017
to
31.03.2019

*8% and 12% are effective rates of GST after deduction of 1/3rd of value on account of land
value included in the consideration 31

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AFFORDABLE HOUSING: GST RATE @12%- Effective Tate:@8%
• A civil structure or any other original works pertaining to a scheme under Jawaharlal Nehru National
Urban Renewal Mission or Rajiv Awaas Yojana;
• A civil structure or any other original works pertaining to the “In-situ rehabilitation of existing slum
dwellers using land as a resource through private participation” under the Housing for All (Urban)
Mission/Pradhan Mantri Awas Yojana, only for existing slum dwellers;
• A civil structure or any other original works pertaining to the “Beneficiary led individual house
construction / enhancement” under the Housing for All (Urban) Mission/Pradhan Mantri Awas
Yojana;
• Low-cost houses up to a carpet area of 60 square metres per house in a housing project approved
by competent authority empowered under the 'Scheme of Affordable Housing in Partnership'
framed by the Ministry of Housing and Urban Poverty Alleviation, Government of India;
• Low cost houses up to a carpet area of 60 square metres per house in a housing project approved by
the competent authority under-
1) the “Affordable Housing in Partnership” component of the Housing for All (Urban) Mission/Pradhan
Mantri Awas Yojana;
2) any housing scheme of a State Government;
• A civil structure or any other original works pertaining to the “houses constructed or acquired
under the Credit Linked Subsidy Scheme for Economically Weaker Section (EWS)/ Lower
Income Group (LIG)/ Middle Income Group-1 (MlG-1)/ Middle Income Group-2 (MlG-2)”
under the Housing for All (Urban) Mission/ Pradhan Mantri Awas Yojana (Urban);’
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CONSTRUCTION
SECTOR
WEF 01.04.2019
NEW PROJECT
ONGOING PROJECT

NEW PROJECT
From 01.04.2019 onwards

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Real Estate Project
• The term "Real Estate Project (REP)" shall have the same meaning as assigned to it in section
2(zn) of the Real Estate (Regulation and Development) Act, 2016 [RERA] - clause (xviii) of
paragraph 4 of Notification No. 11/2017-CT (Rate) and 8/2017-IT (Rate) both dated 28-6-2017
inserted w.e.f. 1-4-2019.
• As per section 2(zn) of the Real Estate (Regulation and Development) Act, 2016 [RERA],
"Real estate project" means the
• development of a building or
• a building consisting of apartments, or
• converting an existing building or a part thereof into apartments, or
• the development of land into plots or apartments, as the case may be,
• for the purpose of selling all or some of the said apartments or plots or building, as the case
may be, and
• includes the common areas, the development works, all improvements and
structures thereon, and all easement, rights and appurtenances belonging thereto.
40

Residential Real Estate Project (RREP)
• The term "Residential Real Estate Project (RREP)" shall mean a REP in
which the carpet area of the commercial
apartments is not more than 15% of the total
carpet area of all the apartments in the REP -
clause (xix) of paragraph 4 of Notification No. 11/2017-CT (Rate) and
8/2017-IT (Rate) both dated 28-6-2017 inserted w.e.f. 1-4-2019.
41

Common buildings cannot be considered
for purpose of 15% commercial apartments
• In any real estate project, there are some common buildings like
Security Office, Club House, Temple, Security Cabin, library
etc. for use of all members of society.
• These cannot be considered for limit of 15%, as these are not
'commercial apartments'. These are not for sale.
42

DEFINITION: CARPET AREA
• The term "carpet area" shall have the same meaning assigned to it in section 2(k) of the Real
Estate (Regulation and Development) Act, 2016 [RERA] - clause (xxvi) of paragraph 4 of
Notification No. 11/2017-CT (Rate) and 8/2017-IT (Rate) both dated 28-6-2017 inserted w.e.f. 1-
4-2019.
• As per section 2(k) of the Real Estate (Regulation and Development) Act, 2016
[RERA], "Carpet area" means the net usable floor area of an
apartment, excluding the area covered by the external walls, areas
under services shafts, exclusive balcony or verandah area and
exclusive open terrace area, but includes the area covered by the
internal partition walls of the apartment.
43

Construction of affordable residential apartments by a
promoter in a Residential Real Estate Project (REP)-
Notification No. 03/2019-Central Tax (Rate) dated 29.03.2019 effective from 01.04.2019]
DESCRIPTION RATE & CONDITION
Construction of affordable residential apartments by a promoter in
a Residential Real Estate Project (herein after referred to as RREP)
which commences on or after 1st April, 2019 or in an ongoing
RREP in respect of which the promoter has not exercised option
to pay tax on construction of apartments at the old rates, intended
for sale to a buyer, wholly or partly, except where the entire
consideration has been received after issuance of completion
certificate, where required, by the competent authority or after its
first occupation, whichever is earlier.
1.5% [0.75% CGST+
0.75%SGST/UTGST]
EFF. Rate- 1%
Provided that the tax shall be
paid in cash, that is, by debiting
the electronic cash ledger only;
credit of input tax charged on
goods and services used in
supplying the service has not
been taken.
1% [ 0.5% CGST+ 0.5% SGST/UTGST]are effective rates of GST after deduction of 1/3rd of value on
account of land value included in the consideration.
44

AFFORDABLE RESIDENTIAL APARTMENT
• a residential apartment in a project which commences on or after 1st April, 2019, or
in an ongoing project,
• having carpet area not exceeding 60 square meter in metropolitan cities or
90 square meter in cities or towns other than metropolitan cities and
• for which the gross amount charged is not more than Rs. 45 Lacs.
• For the purpose of this clause, -
• Metropolitan cities are Bengaluru, Chennai, Delhi NCR (limited to Delhi, Noida,
Greater Noida, Ghaziabad, Gurgaon, Faridabad), Hyderabad, Kolkata and
Mumbai (whole of MMR)
• Gross amount shall be the sum total of- [Consideration charged for the construction services +
Amount charged for the transfer of land or undivided share of land,+ Any other amount
charged by the promoter from the buyer of the apartment including preferential location charges,
development charges, parking charges, common facility charges etc.]
45

Construction of residential apartments other than affordable residential
apartments by a promoter in a Residential Real Estate Project (RREP)
Construction of residential apartments other than affordable
residential apartments by a promoter in an RREP which
commences on or after 1st April, 2019 or in an ongoing RREP in
respect of which the promoter has not exercised option to pay tax
on construction of apartments at the old rates, intended for sale to
a buyer, wholly or partly, except where the entire consideration has
been received after issuance of completion certificate, where
required, by the competent authority or after its first occupation,
whichever is earlier.
7.5% [3.75% CGST+
3.75%SGST/UTGST]
EFF. Rate- 5%
been taken.
5% [ 2.5% CGST+ 2.5% SGST/UTGST]are effective rates of GST after deduction of 1/3rd of value on account of
land value included in the consideration. 46

Construction of commercial apartments (shops, offices, godowns etc.)
by a promoter in a Residential Real Estate Project (RREP)
Construction of commercial apartments (shops, offices, godowns
etc.) by a promoter in an RREP which commences on or after 1st
April, 2019 or in an ongoing RREP in respect of which the
promoter has not exercised option to pay tax on construction of
apartments at the old rates, intended for sale to a buyer, wholly or
partly, except where the entire consideration has been received
after issuance of completion certificate, where required, by the
competent authority or after its first occupation, whichever is
earlier.
7.5% [3.75% CGST+
3.75%SGST/UTGST]
EFF. Rate- 5%
Provided that the tax shall be paid
in cash, that is, by debiting the
electronic cash ledger only;
supplying the service has not been
taken.

Construction of affordable residential apartments by a
promoter in a Real Estate Project (REP) other than RREP
Construction of affordable residential apartments by a promoter in
a Real Estate Project (herein after referred to as REP) other than
RREP which commences on or after 1st April, 2019 or in an
ongoing REP other than RREP in respect of which the promoter
has not exercised option to pay tax on construction of apartments
at the old rates, intended for sale to a buyer, wholly or partly,
except where the entire consideration has been received after
issuance of completion certificate, where required, by the
competent authority or after its first occupation, whichever is
earlier.
1.5% [0.75% CGST+
0.75%SGST/UTGST]
EFF. Rate- 1%
been taken.

Construction of residential apartments other than affordable residential
apartments by a promoter in a Real Estate Project (REP) other than a RREP
residential apartments by a promoter in a REP other than a RREP
which commences on or after 1st April, 2019 or in an ongoing REP
other than RREP in respect of which the promoter has not
exercised option to pay tax on construction of apartments at the
old rates, intended for sale to a buyer, wholly or partly, except
where the entire consideration has been received after issuance of
completion certificate, where required, by the competent authority
or after its first occupation, whichever is earlier.
7.5% [3.75% CGST+
3.75%SGST/UTGST]
EFF. Rate- 5%
been taken.

Construction of Commercial apartments (shops, offices, godowns
etc. )by a promoter in a Real Estate Project (REP) other than RREP
Construction of a complex, building, civil structure
or a part thereof , including commercial apartments
(shops, offices, godowns etc. ) by a promotor in a
REP other than RREP.
18% [9% CGST+
9%SGST/UTGST]
EFF. Rate- 12%
12% [ 6% CGST+ 6% SGST/UTGST]are effective rates of GST after deduction of 1/3rd of value on account of
land value included in the consideration.
50

residential apartments, in respect of which the promoter has exercised
option to pay tax on construction of apartments at the old rates.
Construction of a complex, building, civil structure or a part
thereof , including residential apartments in an ongoing project ,
other than affordable residential apartments, in respect of which
the promoter has exercised option to pay tax on construction of
apartments at the old rates.
18% [9% CGST+
9%SGST/UTGST]
EFF. Rate- 12%
12% [ 6% CGST+ 6% SGST/UTGST] are effective rates of GST after deduction of 1/3rd of value on account of
land value included in the consideration.
51

Affordable residential
apartments by a
promoter in a
Residential Real Estate
Project (RREP)
GST RATE -1%
52

Non- Affordable
residential
apartments by a
promoter in a
Residential Real Estate
Project (RREP)
GST RATE -5%
53

RREP[ Carpet area of
Commercial apartments not
more than 15% ]
Affordable Res. Apt. - 1%
Non-affordable Res. Apt. -5%
Commercial Apt. -5%
54

REP[ Carpet area of
Commercial apartments
more than 15% ]
Affordable Res. Apt. - 1%
Non-affordable Res. Apt. -5%
Commercial Apt. -12%
55

Commercial
apartments in a Real
Estate Project (RREP)
GST RATE -12%
56

ONGOING PROJECT
From 01.04.2019 onwards

58

ONGOING PROJECT
AS ON 01.04.2019

ONGOING PROJECT: MEANING
• As per clause (xx) of paragraph 4 of Notification No. 11/2017-CT (Rate) and 8/2017-IT
(Rate) both dated 28-6-2017 inserted w.e.f. 1-4-2019, the term "ongoing project" shall
mean
• a project which meets all the following conditions, namely-
• commencement certificate in respect of the project, where required to be issued by the competent
authority, has been issued on or before 31st March, 2019, and it is certified by any of the following
that construction of the project has started on or before 31st March, 2019:-
• an architect registered with the Council of Architecture constituted under the Architects Act, 1972 (20 of
1972); or
• a chartered engineer registered with the Institution of Engineers (India); or
• a licensed surveyor of the respective local body of the city or town or village or development or planning
authority.
• where commencement certificate in respect of the project, is not required to be issued by
the competent authority, it is certified by any of the authorities specified in sub- clause (a)
above that construction of the project has started on or before the 31st March, 2019;
60

ONGOING PROJECT: MEANING
• completion certificate has not been issued or first occupation of
the project has not taken place on or before the 31st March, 2019;
• apartments being constructed under the project have been, partly or
wholly, booked on or before the 31st March, 2019.
• Explanation.- For the purpose of sub- clause (a) and (b) above , construction of a project shall
be considered to have started on or before the 31st March, 2019, if the earthwork for site
preparation for the project has been completed and excavation for foundation has
started on or before the 31st March, 2019.
61

62

CONDITIONS FOR NEW RATE:
NEW PROJECT/ONGOING PROGECT
• 80% of value of input + input services, used in supplying the service shall be
received from registered supplier only;
• Where value of input and input services(other than CEMENT) received from
registered suppliers falls short of the said threshold of 80 %, tax shall be paid
by the promoter on value of input and input services comprising such
shortfall at the rate of 18% on reverse charge basis.
• Inputs and input services on which tax is paid on reverse charge basis shall be deemed
to have been purchased from registered person;
• Provided also that notwithstanding anything contained herein above,
where cement is received from an unregistered person, the promoter
shall pay tax on supply of such cement at the applicable (@28%) on
reverse charge basis.
63

• All cement for the project must be purchased from registered
supplier only. If not so received, the promoter is required to pay
GST @ 28% under reverse charge by promoter.
• ♦ After considering payment of GST on cement under reverse
charge, at least 80% of the procurement of inputs and input
services, used in supplying the real estate project service shall be
received from registered supplier only.
• ♦ If there is shortfall in procurement from registered suppliers,
i.e. if still requirement of procurement of 80% from registered
suppliers is not achieved, GST @18% is payable on value to the
extent of shortfall. This adjustment is to be done financial year
wise and not project wise.
• ♦ In case of capital goods procured from unregistered person,
the promoter is liable to pay GST under reverse charge.
64

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67

68

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70

Reversal of Balance ITC if New Rates are Opted for Ongoing Projects
71

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74

Reversal as per Rule 42 in case of Units sold after CC
75

Reversal as per Rule 42 in case of Units sold after Completion Certificate
76

77
Transfers of development
right (TDR)/ FSI (including
additional FSI) /Upfront
amount

Transfer of Development Rights
[ HEADING 9972]
• GST is payable on following services -
♦ Transfer of Development Rights (by land owner or society
or tenant to promoter)
♦ Transfer of Development Rights by Government (in case of
slum rehabilitation project)
♦ Transferable Development Rights (transfer of FSI)
♦ Upfront amount (called as premium, salami, cost, price,
development charges or by any other name) for granting long
term lease of land for thirty years or more.
78

DEFINITION: Floor Space Index
• "Floor space index (FSI)" shall mean the ratio of a
building's total floor area (gross floor area) to the size
of the piece of land upon which it is built - clause
(xxxi) of paragraph 4 of Notification No. 11/2017-CT
(Rate) and 8/2017-IT (Rate) both dated 28-6-2017
inserted w.e.f. 1-4-2019.

GST on Development Rights/FSI transferred or long term lease amount
paid before 31-3-2019
[ Not. No. 4/2018-CT(rate) dt. 25.01.2018]
• If development rights or FSI are transferred for consideration in
form of apartments, two services are involved –
(a) person transferring FSI or development rights to developer or
builder (now termed as 'promoter' w.e.f. 1-4-2019)- this is supply of
FSI/development rights – liable to pay GST
(b) Builder or developer (termed as promoter w.e.f. 1-4-2019) transfers
possession of apartments to transferor of FSI/development rights -
this is supply of construction service- liabile to pay tax on supply
of the construction service.
80

Registered person (landowner- promoter) who transfers development right or FSI
(including additional FSI) to a promoter (developer- promoter)
• Where a registered person (landowner- promoter) who transfers
development right or FSI (including additional FSI) to a promoter
(developer- promoter) against consideration, wholly or partly, in the form
of construction of apartments, -
(i) the developer shall pay tax on supply of construction of apartments to the
landowner, and
(ii) such landowner shall be eligible for credit of taxes charged from him by the
developer towards the supply of construction of apartments by developer to
him,
➢provided the landowner further supplies such apartments to his buyers
before issuance of completion certificate or first occupation, whichever is
earlier,
➢and pays tax on the same which is not less than the amount of tax charged
from him on construction of such apartments
81

Registered person (landowner- promoter) who transfers development right or FSI
(including additional FSI) to a promoter (developer- promoter)
• Explanation:
▪ “developer- promoter” is a promoter who constructs or
converts a building into apartments or develops a plot for sale.
▪ “landowner- promoter” is a promoter who transfers the land
or development rights or FSI to a developer- promoter for
construction of apartments and receives constructed
apartments against such transferred rights and sells such
apartments to his buyers independently.
82

Person liable to pay GST on transfer of Development Rights/FSI/Upfront
amount for long term lease WEF 01.04.2019
[Not. No. 6/2019 - CT (Rate) dated 29.03.2019 Effective from .01.04.2019]
• W.e.f. 1-4-2019, the promoter is liable to pay tax under reverse
charge in respect of following -
♦ Development rights or FSI (including additional FSI)
received on or after 1-4-2019 for construction of project (it
may be residential or commercial).
♦ Long term lease of land (30 years or more) granted after
1-4-2019 for construction of project (it may be residential or
commercial).
83

Transfer of development rights/FSI after 1-4-2019 for construction of
residential apartments exempt, if sold before completion
• Exemption is available in respect of transfer of development rights, FSI
made after 1-4-2019 or upfront amount for long term lease of land (30
years or more) paid after 1-4-2019, to the extent of construction of
residential apartments by promoter, when sale is made by promoter
during construction.
• This exemption is not available –
(a) where entire construction of residential apartment is received after completion
certificate or first occupation i.e. when ready apartments are sold without GST
(b) transfer of Development Rights/FSI or payment of long term lease amount for
commercial apartments.
➢In such cases, promoter is liable to pay GST under reverse charge.
84

85

86

87

Redevelopment
of Residential
Societies

89

RE-DEVELOPMENT PROJECT
• Generally in re-development project, land is owned by a society, comprising members of
the society with each member entitled to his share by way of an apartment. When it
becomes necessary after the lapse of a certain period, society or its flat owners may engage
a promoter (builder/developer) for undertaking re-construction.
• Society/individual apartment owners give 'No Objection Certificate' (NOC) or permission
to the promoter (builder/developer), for reconstruction.
• The promoter (builder/developer) constructs apartments with same or different
carpet area for original owners of apartment and additionally may also be involved
in one or more of the following:
(i) construct some additional apartments for sale to others
(ii) arrange for rental accommodation or rent payments for society
members/original owners for stay during the period of re-construction
(iii) pay an additional amount to the original owners of flats in the society.
90

GST on Slum Réhabilitation Programmes
• In Slum Rehabilitation programmes, Government transfers TDR/FSI to promoter. The
promoter supplies apartments to slum dwellers without monetary consideration.
• The apartments constructed in addition to apartments given free to the slum dwellers
are sold.
• In both the cases, GST is payable - FAQ (Part II) Nos. 8 and 9 issued by CBI&C vide circular
F No. 354/32/2019-TRU dated 14-5-2019.
• If the apartments fall within the definition of affordable residential apartments, GST rate will be
1% [0.5% CGST plus 0.5% SGST/UTGST].
• Similarly, if such apartments are covered under specified schemes, the GST rate will be 1%
91

92
Works Contract
Services under
GST

Under GST laws, the definition of “Works Contract” has been restricted to any work
undertaken for an “Immovable Property” unlike the existing VAT and Service Tax
provisions where works contracts for movable properties were also considered.

94

95

96
MISC.

97

98

2022-TIOL-04-AAAR-GST
IN THE APPELLATE AUTHORITY FOR ADVANCE RULING, GUJARAT
SHREE DIPESH ANILKUMAR NAIK
• GST - Supply of developed plots is construction
service - taxable @18%: AAAR
R N JHA, Additional Assistant Director 99

Thank You

GST on REAL ESTATE SERVICES.pdf

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