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 on commercial lease rentals depends on unregistered status and registration liability under GST rules.
Leasing of land or commercial immovable property to a registered recipient is discussed as a taxable supply under GST, with the question being whether the recipient must discharge tax under reverse charge mechanism when the landlord is not registered. The discussion refers to the notified entry covering renting of property other than a residential dwelling supplied by an unregistered person to a registered person, and the resulting liability of the lessee to pay GST where the supplier has not obtained registration.