GST on rented property

[Kaustubh Karandikar]

XYZ(Proprietor) is owning a commercial property in Mumbai and having GST Registration for the same. XYZ has given this property on rent to PQR(Delhi) who is registered under GST in Delhi. XYZ while billing to PQR for this rented property in Mumbai, XYZ need to charge CGST + SGST or IGST?

[Rajagopalan Ranganathan]

Sir,

According to Section 12 (3) -

The place of supply of services,––

(a) directly in relation to immovable property, including services provided by architects, interior decorators, surveyors, engineers and other related experts or estate agents, any service provided by way of grant of rights to use immovable property or for carrying out or co-ordination of construction work; or

(b) by way of lodging accommodation by a hotel, inn, guest house, home stay, club or campsite, by whatever name called, and including a houseboat or any other vessel; or

(c) by way of accommodation in any immovable property for organising any marriage or reception or matters related thereto, official, social, cultural, religious or business function including services provided in relation to such function at such property; or

(d) any services ancillary to the services referred to in clauses (a), (b) and (c),

shall be the location at which the immovable property or boat or vessel, as the case may be, is located or intended to be located.

Since the property is located in Mumbai CGST and SGST are to be paid at Mumbai

[Ganeshan Kalyani]

I agree with the views of Sri Rajagopalan Sir. CGST +SGST will apply in this transaction.

[YAGAY and SUN]

Place of provision of service is in Mumbai therefore SGST +CGST will be applicable.

AI Summary

Place of supply of immovable property dictates CGST and SGST applicability when property is located in the supplying state.
For services directly related to immovable property, the place of supply is where the property is located; therefore rental services for property situated in Mumbai attract CGST and SGST, regardless of the recipient's registration in another state.