TaxTMI 
TaxTMI 
XYZ Pvt. Ltd. Wants to buy land on lease from Maharashtra Industries Development Corporation (MIDC).
1) Will the MIDC charge GST against this purchase?
2) Is XYZ required to pay GST on it under reverse charge?
GST on leased land
07 Dec 2021 
8 Replies 
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GST on lease of land treated as supply; reverse charge applies only if lessor qualifies as Governmental Authority.
Leases of land are treated as a supply of services and attract GST. Reverse charge applies only if the lessor qualifies as a Governmental Authority under the notification; corporate development corporations are typically not treated as government for that purpose. Upfront premiums for long term industrial leases may be IGST exempt, while monthly lease rentals remain taxable. Ongoing concern issues on transfer of business on leased plots were queried but not settled. (AI Summary)
Leases of land are treated as a supply of services and attract GST. Reverse charge applies only if the lessor qualifies as a Governmental Authority under the notification; corporate development corporations are typically not treated as government for that purpose. Upfront premiums for long term industrial leases may be IGST exempt, while monthly lease rentals remain taxable. Ongoing concern issues on transfer of business on leased plots were queried but not settled. (AI Summary)