GST on Hardship Compensation, Rent received from Developer

[Yogesh Ashar]

Dear All

I have a query with regards to GST on receipt of Hardship compensation, rent and other receipts received by a residential flat owner from a builder on redevelopment of society premises. Whether GST would be applicable for the receipts from the builder to the member. if yes then under what entry and the rate for same. whether a plea can be raised that the money received is not in the nature of furtherance of business hence no supply. Kindly guide.

Thanks in advance

CA Yogesh Ashar

AI Summary

Residential Flat Owner Questions GST on Compensation and Rent in Redevelopment; Consideration vs. Liquidated Damages Discussed A residential flat owner queries about the applicability of GST on hardship compensation, rent, and other receipts from a builder during the redevelopment of society premises. The discussion includes two responses. One suggests examining the entire redevelopment agreement to determine GST liability, noting that receipts could be considered either 'liquidated damages' not liable to GST or 'consideration' subject to GST. The broad definition of 'business' under the CGST Act is highlighted. Another response references a court decision on renting residential premises for personal use, suggesting that similar reasoning might apply to these receipts, potentially exempting them from GST.