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Applicability of GST under RCM on compensation (solatium) paid as advance to SLAO(DM) for distribution to Project affected families(R&R), Goods and Services Tax - GST

Issue Id: - 118084
Dated: 28-7-2022
By:- THDC India

Applicability of GST under RCM on compensation (solatium) paid as advance to SLAO(DM) for distribution to Project affected families(R&R)


  • Contents

A Coal Block has been allotted to a PSU by Ministry of Coal, GOI and the land acquisition for the project is under advanced stage.

In this reference, R&R policy of Coal Mine Project has been approved by Commissioner, and is being implemented by District Authorities. 53.13 Ha Govt. Land of a has been allotted by District authorities for resettlement of eligible PAFs (Project Affected Families). PAF's are provided with the following options to choose from:

Constructed House in R&R Colony

Plot and ₹5 Lakhs in lieu for construction of house

₹7 Lakhs in lieu of house and plot

Collector informed that PAFs have given their option and further, directed PSU to deposit an advance against the benefit to be given to eligible PAF's as per approved R&R policy of . To be deposited deposited with Collector.

It is requested to confirm whether GST under RCM will be applicable in the subject case.

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Page: 1


1 Dated: 29-12-2022
By:- Padmanathan Kollengode

In my understanding, the Govt is facilitating the taking over of land by PSU and rehablitation. If any amount is paid by PSU to Govt for this activity it will be liable to GST under RCM. However, deposit of compensation is not consideration for any supply and hence, not liable to GST in my opinion


Page: 1

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