GST on Layout

[Ethirajan Parthasarathy]

GST Council in its 47th meeting issued a clarification as follows:-

'Sale of land after leveling, laying down of drainage lines etc., is sale of land and does not attract GST'

To my knowledge till now no such clarification has been issued.

Can we take a stand in an ongoing proceedings based on above decision of GST council, that notice is payable on sale of developed plots after completion of related infrastructure. Please clarify.

[Rajagopalan Ranganathan]

Sir,

The decision of GST Council cannot be given effect unless the required exemption Notification is issued by the Government. Even if a exemption notification is issued it will have only prospective effect unless it is specifically provided in the Notification that the exemption granted by the notification has retrospective effect. Therefore demands for past period are enficeable unde law.

[Amit Agrawal]

This being a 'clarification' about the position of law as existed since beginning, same (which is expected to be issued by way of circular using powers u/s 168 (1) of the CGST Act, 2017) will be applicable w.e.f. 01.07.2017.

Till such circular is used, nothing stops you from using the press-release to defend yourself in going proceedings.

But, such press-release will not have same effect on adjudicating authority as compared to a official circular issued by Board, while adjudicating your case.

And, ideally, instead of using such press-release/s, it is better to wait for issuance of such circular and see if wordings are such circular really helpful to the fact and circumstances of your case or there are any catch / fault-lines etc.

These are strictly personal views of mine and the same should not be construed as professional advice / suggestion.

[Ganeshan Kalyani]

Circular is proposed to be issued based on the Press release. It is likely that only basic work like leveling, laying down of drainage etc will be covered in the exemption list. One cannot construct small security office and say it is for the purpose of selling land so it is land only. So, clarification is awaited as regard extent of basic work done on land will be considered as land. With the sea of notifications on rate, rules and some circular it is less likely that circular will be issued in shorter time. Govt may take some more time to issue circular on this issue.

[KASTURI SETHI]

Press release has no statutory force.

[Shilpi Jain]

Also it is better to wait for the clarification to see what they actually clarify. Whether they settle or unsettle it further!!

AI Summary

GST Council: Sale of Land with Improvements Not Taxable, Formal Notification Needed for Legal Standing A discussion on the Goods and Services Tax (GST) forum revolves around a clarification from the GST Council's 47th meeting stating that the sale of land, after leveling and laying drainage lines, does not attract GST. Participants debate whether this clarification can be used in ongoing proceedings without an official exemption notification. Some suggest waiting for a formal circular for clarity, as press releases lack statutory force and may not influence adjudicating authorities effectively. The consensus is that the government's formal notification is necessary for the clarification to have legal standing.