Rate of GST on sub lease of long term right

[Ramesh Panda]

Sir,

What will be the rate of GST on upfront amount received on sub leasing of industrial plot alloted by State Govt. by the original lease holder for rest of the lease period i.e. more than 30 years. can it be exempt under Notification No. 12/2017-CT(R) under heading 9972.

[Prudhvi Jakkula]

In that serial number only service provided by state government to industrial units was exempt. But in this case service was being provided by lessee to another person. So Exemption will not be available.

AI Summary

Exemption for state-government services does not extend to lessee subleases, so GST applies to upfront sublease receipts. The exemption entry at the cited serial number applies to services provided by the State government to industrial units; a private lessee's sublease to another person does not fall within that scope, so the exemption is not available to the lessee and the upfront sublease receipt is not covered by that provision.