Developer's Land-Transfer Deal Triggers Full GST Liability Under Joint Development Agreement with One-Third Land Value Deduction

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Full Text of the Document

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....The AAR determined that the developer-promoter's transaction involving undivided share of land and constructed residential units does not qualify as a "sale of land" under Item No. 5 of Schedule III of CGST Act. The Joint Development Agreement and subsequent sale of apartments attract GST liability. Despite the applicant's contention that the composite value represents land sale and should be exempt, the ruling clarifies that the transaction involves supply of service and goods, rendering GST applicable. The applicant must pay GST on the transaction value, with a permissible one-third deduction for land value, particularly for transactions executed before the completion certificate or first occupation of residential units.....