Land Rights Transfer: MIDC Property Assignment Exempted from GST Under Interim Relief Pending Comprehensive Legal Review

The Bombay HC considered whether GST applies to assignment of MIDC-allotted land and building leasehold rights. Following the Gujarat HC's precedent, the court granted ad-interim relief by staying the GST authorities' order. The court recognized this as a significant legal issue and directed the petition to be heard with connected cases, effectively suspending GST levy on such property transfers pending final adjudication.

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The Bombay High Court addressed whether Goods and Services Tax (GST) applies to the assignment of leasehold rights of MIDC-allotted land and buildings constructed thereon, transferred to a third party for lump-sum consideration. The GST Authorities treated this as a supply of service under the CGST Act, 2017. The Petitioner relied on the Gujarat High Court's Division Bench decision in Gujarat Chambers of Commerce and Industry v. Union of India (2025), which held that such assignment constitutes a "sale/transfer of benefits arising out of immovable property" and is not subject to GST under Section 9 of the CGST Act, as Section 7(1)(a), Schedule II Clause 5(b), and Schedule III Clause 5 do not apply.Noting no contrary authority, the Bombay High Court recognized this as a significant issue also raised in other petitions (e.g., Siemens Limited v. Union of India), where adjudication was stayed. The Court granted ad-interim relief by staying the operation of the impugned order dated 30.01.2025 and directed that this petition be heard along with connected petitions on 28.04.2025. The order was digitally signed and authorized for immediate effect upon production.

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