GST Applicability

[Ethirajan Parthasarathy]

Land aggregator is entrusted with the work of creating a large land Bank.

His scope of work is to pool together different (adjustment) land owners who will agree to sell the land to the aggregator or his nominee.

He does this on behalf of a corporate who are interested in a acquiring large area for constructing their godown/factory etc.

The aggregator's work involves conversion of land use, laying of approach road, removal of trees & structures, leveling of land etc. The land is sold to the company directly by the land owners. The company will pay the “X” amount to land owner and “Y” amount to land aggregator.

My question is whether the Land aggregator is liable to GST, If yes, whether on “Y” amount or total of X + Y. Can this be classified as “Composite Supply” of which principal supply is service in nature and hence the total of X+Y suffers GST @ 18%

AI Summary

GST Applicability on Land Aggregator Services: Fee vs. Total Transaction Value Depends on Contract Specifics A discussion on the applicability of Goods and Services Tax (GST) to a land aggregator's services was initiated. The aggregator's role involves facilitating land sales and preparing the land for construction on behalf of a corporate client. The query concerns whether GST applies to the aggregator's fee ('Y' amount) or the total transaction value ('X + Y'). The response suggests that GST applicability depends on the contract specifics. If the contract is solely for facilitating the sale, the land value may be excluded from GST. However, if the contract includes making the land construction-ready, the entire value may be subject to GST.