Appeal Dismissed for Late Filing; GST on Partially Constructed Flats Stands

The appeal was dismissed due to a delay in filing beyond the statutory period, with the Appellate Authority citing the inability to condone the 77-day delay. Consequently, the issue of the applicability of GST on partially constructed flats was not further deliberated, and the ruling of the Karnataka Authority for Advance Ruling, which determined GST applicability based on the stage of completion and customer identification, remains in effect.

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Issues Involved:
1. Applicability of GST on partially completed flats having identified customers before the GST regime.
2. Applicability of GST on partially completed flats where customers are identified after the implementation of the GST regime.
3. Applicability of GST on partially completed flats where no customers are identified.
4. Delay in filing the appeal beyond the statutory period.

Detailed Analysis:

1. Applicability of GST on partially completed flats having identified customers before the GST regime:
The Karnataka Authority for Advance Ruling held that for partially completed flats with identified customers before the GST regime, the appellant is liable to pay service tax under the Finance Act, 1994, proportionate to the services provided up to 30.06.2017. From 01.07.2017 onwards, GST is applicable proportionate to the services provided effective from 01.07.2017, in terms of Section 142(11)(b) of the CGST Act 2017.

2. Applicability of GST on partially completed flats where customers are identified after the implementation of the GST regime:
The Authority ruled that for partially completed flats where customers are identified after the implementation of GST, the appellant is liable to pay GST on the transaction value of the supply. The appellant contested this ruling, arguing that it contradicts the definition of "works contract" under Section 2(119) of the GST Law and the precedent set by the Supreme Court in the case of Larsen and Toubro Limited and Another vs State of Karnataka and Another [2013] 75 VST 1. The appellant emphasized that construction activity amounts to a works contract only when there is a customer, and hence, no GST should be levied on work executed before identifying the customers.

3. Applicability of GST on partially completed flats where no customers are identified:
The Authority determined that for partially completed flats where no customers are identified, the appellant is not liable to GST as no supply is involved. However, if the supply is made before the issuance of the completion certificate, GST is liable to be paid on the transaction value of the supply.

4. Delay in filing the appeal beyond the statutory period:
The appeal was filed 77 days after the date of receipt of the ruling, exceeding the statutory period for filing an appeal under Section 100 of the CGST Act, 2017. The relevant provision mandates that an appeal should be filed within 30 days from the date of communication of the advance ruling order, with a possible extension of an additional 30 days if sufficient cause is shown. The Appellate Authority noted that the appellant did not provide reasons for the delay and referenced the Supreme Court's interpretation in Singh Enterprises vs CCE, which held that statutory authorities do not have the power to condone delays beyond the prescribed period. Consequently, the Appellate Authority dismissed the appeal on grounds of time limitation, stating that it is not empowered to condone the delay of 77 days in filing the appeal.

Conclusion:
The appeal was dismissed on the grounds of time limitation, and the merits of the issue regarding the applicability of GST on partially constructed flats were not discussed further. The ruling of the Karnataka Authority for Advance Ruling stands, with GST being applicable as per their initial determination.

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