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2023 (10) TMI 286 - HC - GSTExemption granted by the Central Government under Section 11 of the Goods and Services Tax Act, 2017 - demand of GST on premium paid by the petitioner to YEIDA for allotment of Institutional Plot to set up a Hospital - HELD THAT - There is no doubt that the petitioner was allotted Institutional Plot H-02 at Sector 22-A, YEIDA, by the YEIDA on 28.04.2015. On 01.07.2017, the Act was enforced. Thus GST provisions became relevant to the allotment made to the petitioner with respect to instalments that were required to be paid by the petitioner, after 30.06.2017. The Exemption Notification though does contain Column no. 5, to specify the condition for grant of exemption yet, against Entry no. 41 of that Notification there never existed any specification or condition for grant of exemption. In fact, the original Notification No. 12/2017, dated 28th June, 2017 mentions the word Nil against Column no. 5, against Entry no. 41 thereto. Thus the legislature chose to grant unconditional exemption with respect to payment of upfront amounts. While amending that Notification, vide Notification No. 32/2017, dated 13th October, 2017 though other changes were made to add by way of an activity for which allotment of plots were made exempt from tax and certain Corporations were also sought to be included wherein ownership of the Central Government or the State Government etc. may exceed 50%, at the same time, no amendment was made to the original Notification to introduce any condition for grant of that exemption. The exemption made available to the petitioner by virtue of the original Notification issued under Section 11 read with order of the Authority for Advance Ruling, is unconditional. Consequently, the letter dated 24.08.2018 issued on behalf of YEIDA is wholly unfounded in law and also in facts. Besides absence of conditions imposed by the legislature while granting exemption, no fact allegation has been made in the said communication of any specific condition having been violated by the petitioner. The impugned communication dated 24.08.2018 is quashed - Petition allowed.
Issues Involved:
1. Validity of the demand for GST on premium paid for an institutional plot. 2. Applicability of GST exemption under Notification No. 12/2017 and its amendment. Summary: Issue 1: Validity of the demand for GST on premium paid for an institutional plot The petitioner sought to quash the letter dated 24.08.2018 from YEIDA demanding GST at 18% on the premium of Rs. 3.80 crores for an institutional plot allotted on 28.04.2015. The petitioner argued that the demand was illegal and without authority as no tax demand was raised by the Revenue Authorities. Furthermore, the petitioner claimed exemption under Section 11 of the Goods and Services Tax Act, 2017, supported by Notification No. 12/2017 and its amendment Notification No. 32/2017. The Authority for Advance Ruling had already confirmed this exemption in its order dated 06.06.2018, which had attained finality. Issue 2: Applicability of GST exemption under Notification No. 12/2017 and its amendment The court examined Section 11(1) of the Act and the relevant notifications. Notification No. 12/2017, dated 28th June 2017, and its amendment Notification No. 32/2017, dated 13th October 2017, exempted the upfront amount paid for long-term leases of industrial plots from GST. The Authority for Advance Ruling had cleared any doubt by ruling that GST was not applicable to the upfront amount if conditions under Sl. No. 41 of the Notification were satisfied. The court noted that the exemption was unconditional as no specific conditions were mentioned against Entry No. 41 in the notifications. Conclusion: The court found the demand letter dated 24.08.2018 from YEIDA to be "wholly unfounded in law and also in facts." It quashed the letter and ordered that any amount deposited by the petitioner pursuant to the impugned communication be refunded within one month, failing which it would attract interest at the rate of 8% from the date of deposit till the date of refund. The writ petition was allowed with no orders as to costs.
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