GST on one-time lease premium upheld where long-term lease is treated as a taxable supply of services.

GST applies to a one-time lease premium charged for a long-term lease of plots because the GST charging framework treats lease, rental and other transfers for consideration as supplies in the course of business, and Schedule II treats lease or tenancy of land as a supply of services. The statutory character of the lessor as a planning or development authority does not, by itself, take the transaction outside the tax net. Exclusion would require a specific Government notification treating the activity as neither supply of goods nor supply of services, and none was shown. As a result, the levy on the lease premium was upheld.

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Issues: Whether GST was leviable on the one-time lease premium charged for long-term lease of plots by the statutory development authority.

Analysis: The charging scheme under the GST law treats supply broadly to include lease, rental and other transfers made for consideration in the course or furtherance of business. The definition of consideration includes payment made in respect of the supply, and Schedule II treats lease or tenancy of land and letting out of buildings as supply of services. The statutory character of the lessor as a planning or development authority does not, by itself, exclude the transaction from the tax net. Exclusion is possible only if the Government issues a notification under the relevant provision treating such activity as neither supply of goods nor supply of services. No such notification was shown. Authorities under other enactments and decisions dealing with income tax, service tax, or constitutional validity of development corporations did not govern the GST levy on supply.

Conclusion: GST was validly leviable on the one-time lease premium, and the challenge to its collection failed.

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