TaxTMI 
TaxTMI 
GST rate for land owner after completion of residential apartments
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....ST rate for land owner after completion of residential apartments<br> Query (Issue) Started By: - Raam Srinivasan Swaminathan Kalpathi Dated:- 14-7-2026 Last Reply Date:- 19-7-2026 Goods and Services Tax - GST<br>Got 6 Replies<br>GST<br>JDA signed in Feb 2023 Project completed in July 2026 Residential apartments Builder has charged landlord 3.75% CGST and 3.75% SGST are abating 1/3rd of l....
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....and owner transfer value. Is the % applied correct? Request experts to confirm. Thanks Reply By Sadanand Bulbule: The Reply: Refer Discussion Issue ID : 121017 Reply By Sadanand Bulbule: The Reply: 2026 (4) TMI 1653 - KARNATAKA HIGH COURT - The State of Karnataka, The Additional Commissioner of Commercial Taxes (Zone) -1, Department of Commercial Taxes, Government ....
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....of Karnataka, The ...More Reply By KALLESHAMURTHY MURTHY K.N.: The Reply: Sir, According to Notification No. 3/2019-Central Tax (Rate), when a developer provides construction services to a landowner in exchange for development rights (JDA), the value of the supply is deemed equal to the value of similar apartments sold to independent buyers. The effective rate of tax is applicable at 5%....
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...., where the land cost includes; otherwise, it is 7.5% after abating the land cost. Crucially, the 1/3rd land deduction must be subtracted from this value before calculating tax. Because the transaction inherently includes the transfer of an undivided share of land back to the landowner as part of the apartment, the land component remains fully exempt from GST under Schedule III of the CGST Act.....
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.... However, cost-effectiveness depends upon the terms and conditions of the mutual agreement between the land owner and the developer. In the present case, the builder is correct because he is responsible for the tax payment on both the landowner's share and the developer's share. Reply By KASTURI SETHI: The Reply: Dear Sir, No room left for any doubt in your reply. ....
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.... Reply By KALLESHAMURTHY MURTHY K.N.: The Reply: Kasturi Sethi Ji, Thank you very much Sir. Reply By Shilpi Jain: The Reply: If the value adopted to charge GST includes land value (or value of undivided share of land) then charging 3.75% + 3.75% with 1/3rd deduction is correct.<br> Discussion Forum - Knowledge Sharing ....