Payment of tax under RCM - Lease of land

[Rohit K]

Hi Members,

I have a situation where a landlord has given a piece of land for lease to company for commercial purposes. The landlord has not obtained GST registration but the company is paying an amount of Rs. 30 lakh to the landlord per month.

In the present case, whether landlord has to obtain registriation or brewery has to pay GST under RCM?

As per notification 9/2024 CT(Rate) dated 08.10.2024 read with Notification 5/2017, GST on Service by way of renting of any property other than residential dwelling is to be paid by recipient of service.

Please clarify.

AI Summary

Reverse charge GST on commercial lease rent raises the question of registration and tax liability for the recipient company. GST liability on lease rent for commercial use is raised where a landlord leases land to a company, the landlord is unregistered, and the company pays monthly consideration for the lease. The issue is whether the landlord must obtain GST registration or whether the recipient company must discharge GST under the reverse charge mechanism for renting of property other than a residential dwelling.