GST Rate Applicable

[Ethirajan Parthasarathy]

Is leasing out License to trade in Liquor is to be classified as IPR services. If yes is GST rate 12?.

[Alkesh Jani]

Sir,

In this regards, there are two scenario in this matter

1. Leasing of License may be considered as goods, as per definition of goods given at Section 2(55) of CGST Act, 2017, and may be treated as supply of service as per Para 5 (2) (c) of Schedule-II appended to the Act. The applicable GST may be 18%.
2. Leasing of License may be considered as services falling under HSN Code 997339, as IPR and the applicable GST rate may be 12%.

In my point of view, point No.1 is applicable, as the IPR in India is governed by different Act such as, The patent Act, 1970, Trade Mark Act, Design Act, etc. So I do not find that leasing of license of liquor is falling or governed by any of such Acts, if any, querist is request to elaborate the same.

Our experts may like to correct me, if mistaken

Thanks

[YAGAY and SUN]

We do endorse the view as expressed by Mr. Jani that leasing out of Licenses to trade in Liquor will not fall under the Intellectual Property Rights unless untill you are using others' Trade Mark or Trade Name etc.

[Himansu Sekhar]

But liquor licence attracts gst or not.

AI Summary

GST classification of liquor licences determines if supply is treated as IPR service or as taxable supply at higher rate.
Leasing a licence to trade in liquor may be classified either as a supply treated under the goods-to-service conversion attracting the standard higher GST rate, or as an IPR-related service subject to a lower IPR service rate. The author favors classification as not being IPR because statutory intellectual property regimes do not govern liquor licences; other respondents agree unless the licence involves use of another party's trademark or trade name. The precise GST applicability and rate depends on the factual characterisation of the licence.