Advance Ruling Application on GST Rate for Real Estate PLC Rejected for Failure to Attend Hearings

The application seeking an Advance Ruling on the GST rate applicability for Preferential Location Charges (PLC) in real estate sales was rejected due to the applicant's failure to attend hearings within the required timeframe. The issues included determining the GST rates for PLC before and after issuance of completion/occupation certificates, claiming adjustment/refund of excess GST paid, and charging GST on differential property prices. The rejection under Section 98(2) of the CGST/HGST Act emphasized the importance of timely participation in the ruling process and the statutory obligation to deliver rulings promptly.

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Issues involved:
1. GST rate applicability on preferential location charges collected for sale of properties before and after issuance of completion/occupation certificate.
2. Claiming adjustment/refund of excess GST amount paid on preferential location charges.
3. Charging GST on differential prices for sale of different properties in a real estate project.

Analysis:
1. The applicant, a developer of residential and commercial properties, sought an Advance Ruling on the GST rate applicability for Preferential Location Charges (PLC) collected with property sales before and after issuance of completion/occupation certificate. The key questions were whether PLC attracts a GST rate of 12% or 18% for sales before issuance of CC/OC and whether it attracts 5% or 18% for sales before issuance of CC/OC under new projects starting after April 1, 2019. Additionally, the issue of PLC being outside the scope of supply post-CC/OC sale was raised. The applicant failed to appear for hearings, leading to rejection of the application under Section 98(2) of the CGST/HGST Act due to the statutory requirement of pronouncing a ruling within 90 days of application receipt.

2. Another aspect of the ruling involved the possibility of claiming adjustment or refund of excess GST amount paid on PLC if it attracts a concessional rate of tax or exemption. The applicant or its customers could potentially claim refunds for the difference between the GST rates applicable (12%, 5%, or nil) based on the circumstances of the case. However, due to the applicant's non-appearance and the time constraints under Section 98(6) of the CGST/HGST Act, the application was rejected without further hearing opportunities.

3. Lastly, the judgment addressed the question of charging GST on differential prices for various properties or units in a real estate project due to commercial factors like location. The query was whether GST could be uniformly charged at rates based on the time of sale relative to CC/OC issuance (12% for pre-CC/OC sales, 5% for new projects post-April 1, 2019, and nil for post-CC/OC sales). The rejection of the application was based on the applicant's failure to attend hearings within the stipulated timeframe, leading to the dismissal under Section 98(2) of the CGST/HGST Act.

In conclusion, the judgment highlighted the importance of timely participation in the Advance Ruling process and the statutory obligation to deliver rulings within the specified timeframe, ultimately resulting in the rejection of the application due to the applicant's non-appearance.

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