TaxTMI 
TaxTMI 
TaxTMI 
2021 (8) TMI 731
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....:- 1. As to whether GST is payable on the transfer of leasehold rights in respect of the consideration of Rs. 15 Crores received by them from M/s. INOX Air products Private Limited for the land allotted by SIPCOT? 2. Whether the Subsequent transfer of SIPCOTs allotted land from the Applicant to M/s. Inox Air Products Private Limited would fall within the ambit of 'Supply' as defined under Section 7 of the Goods and Services Act 2017? The Applicant has submitted the copy of application in Form GST ARA - 01 and also submitted a copy of Challan evidencing payment of application fees of Rs. 5,000/- each under sub-rule (1) of Rule 104 of CGST rules 2017 and SGST Rules 2017. 2.1 The applicant has stated that they are engaged in manufacturing of goods and was allotted land measuring to an extent of 15.34 acres by the State Industrial Promotion Corporation of Tamilnadu (hereinafter referred as SIPCOT). SIPCOT had allotted land measuring 19.04 acres vide lease deed dated 07.07.1993 vide Document No. 3002 of 1993. Thereafter SIPCOT had further allotted land measuring 1.30 acres vide lease deed dated 14.12.1994 vide Document No. 6460 of 1994. Subsequent to the above allotment, t....
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....omises to do or to abstain from doing something, such act or abstinence, or promise is called a consideration for the promise. That in the instant case although the transfer of allotment is agreed to be made, the same is contingent on the approval, acceptance and subject to such terms and conditions that may be imposed by the SIPCOT. Further, they have stated that the second stem of submissions relates to Schedule-II to the CGST Act 2017.; that the said transfer of leasehold rights are effected only at the approval of the SIPCOT, being subjected to certain conditions imposed by them, it cannot be said that there is an obligation to do an act as per the agreement entered into prior to such approval.; Section 7 of the CGST Act 2017 dealing with 'Supply' does not contemplate agreeing to do an act between supplier and receiver at the approval of a third party, subject to such conditions as imposed by such third party and the said situation is not inbuilt in the provisions relating to supply which is taxable. 3. Due to the prevailing PANDEMIC situation and in order not to delay the proceedings, the applicant was addressed through the Email Address mentioned in the application t....
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....d from the Applicant to M/s. Inox Air Products Private Limited would fall within the ambit of 'Supply' as defined under Section 7 of the Goods and Services Act 2017? The questions raised as above requires ruling as to whether the activity undertaken by them is a 'Supply' under GST and whether tax is payable on the 'Consideration' received. The questions raised are within the ambit of this authority as per Section 95/97(2) of GST Act and therefore the application is admitted. 7.1 From the facts of the case as available before us, it is seen that IPL was allotted and were holding lease of 15.34 acres of land in the SIPCOT Industrial Complex at Hosur(phase-II). The Original lease was entered into for a period of 99 years and the lease was entered into vide lease deed dt. 07.07.1993. INOX had approached them to transfer un-utilized portion of the allocated land to the extent of 5.00 acres for setting up a state of the art Ultra High Purity Cryogenic Liquid Medical and Industrial Oxygen Plant. A Memorandum of Understanding (MOU) has been entered into between the applicant and INOX on 20.11.2020 for transfer of leasehold rights for the remaining period of lease ....
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....on in the land allotted to them. However, the applicant can part with its interest in the leasehold held by them with the approval of SIPCOT, who may or may not grant the request with or without any further conditions. 7.3 The applicant has stated to have entered into a Memorandum of Understanding with INOX dated 20.11.2020. From the said MOU, the following are seen:- * MOU is executed to formalize the terms agreed between them for transfer of the remainder of the leasehold rights in the Schedule property by IPL in favour of INOX, subject to approvals being granted by SIPCOT * IPL agrees to transfer the remainder of its leasehold rights for a consideration of Rs. 15 Crores for lease hold rights determined at the rate of Rs. 3 Crore per Acre * IPL to sign and submit the application to SIPCOT for transfer of leasehold rights in favour of INOX * INOX to make necessary application to SIPCOT to obtain the necessary approval letter from SIPCOT * On receipt of approval letter from SIPCOT, INOX to pay the differential land cost and processing fees to SIPCOT * Modified lease deed to be executed and post registration and on receipt of the payment of consideration agreed upon, IP....
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.... sub-section (1), they shall be treated either as supply of goods or supply of services as referred to in Schedule II.; The definition is an 'inclusive' definition. An activity to be considered as a 'Supply' should satisfy the following:- * all forms such as sale, transfer, etc are supply * such supply should be for a consideration * and made by a person in the course or furtherance of business. 'business' for the purposes of GST is defined under 2 (17) of the act as:- (17) business includes,- (a) any trade, commerce, manufacture, profession, vocation, adventure, wager or any other similar activity, whether or not it is for a pecuniary benefit; (b) any activity or transaction in connection with or incidental or ancillary to sub-clause (a); (c) any activity or transaction in the nature of sub-clause (a), whether or not there is volume, frequency, continuity or regularity of such transaction; (d) supply or acquisition of goods including capital goods and services in connection with commencement or closure of business;....................... The definition of 'business' is also an inclusive definition and as per 2(17)(d) above, servic....