GST on TDR (Transferrable Development Rights)

[Kalpesh Shah]

My client purchase a TDR (Transferrable Development Rights) on 05/02/2019 for constructing a RREP. So, he will be liable to pay GST on RCM basis on TDR purchase from Unregistered Seller on unsold area of the project. The Tax officer has issued show cause notice regarding the payment of GST on TDR being the project was started for which TDR purchased from 01/07/2019 and completed on 25/06/2021 as per OC despite TDR was purchased before 01/04/2019.

Please give your valuable opinion on above matter supporting with any case law or judgement.

Thanks & Regards

AI Summary

GST on TDR: reverse charge hinges on time of supply and applies only for transfers after the notification effective date.
Applicability of GST on TDR depends on the time of supply and the notification effective date: transfers completed before the notification's effective date do not attract the later-introduced RCM, so liability for those transfers rests with the transferor, whereas transfers on or after the notification effective date can attract RCM on purchases from unregistered sellers.