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TMI BlogGST under RCM on Development RightsX X X X Extracts X X X X X X X X Extracts X X X X ..... GST ON DEVELOPMENT CHARGES We are presently executing a project, of which we have received development rights from the land owner (Housing Society). The Builder developer in said project constructing residential commercial apartments, however commercial area does not exceed 15% of total carpet area of the project hence project qualifies as RREP. In lieu of Development Rights Builder D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evelopers will allot certain numbers of Residential Apartments to the Land Owners (Housing society) what will be Builders Developers liability on account of GST under RCM on transfer of Development rights vis a vis Notification 04/2019 Central Tax (Rate) dt.29.03.2019 . - Reply By Shilpi Jain - The Reply = For the share of area which the developer gets, he will have to pay gst under rcm b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y adopting the first sale value near the jda... This liabilty will arise in completion - Reply By hubert fernandes - The Reply = Does Commercial Area also Eligible for exemption if project qualifies as RREP - Reply By Shilpi Jain - The Reply = The exemption for development rights will be eligible only w.r.t. the residential units and not for the commercial units in the RREP since the exmeptio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n notificaiton is clear that it is only for the residential units. - Reply By hubert fernandes - The Reply = Does GST paid under RCM againts Development rights on commercial area qualifies for Input Tax Credit ? - Reply By hubert fernandes - The Reply = Madame ,Agreed , that the exemption with regard to Development rights under RCM is only eligible in respect of the residential units and not f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the commercial units in the RREP. But please refer to explanation 1B of the said notification and the same is contradictory, .The said explanation 1B is reproduced herein below Explanation 1B to principal Notification No. 12/2017- Central Tax (Rate) dated 28.06.17 Value of portion of residential or commercial apartments remaining un-booked on the date of issuance of completion certi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficate or first occupation, as the case may be, shall be deemed to be equal to the value of similar apartments charged by the promoter nearest to the date of issuance of completion certificate or first occupation, as the case may be. - Reply By Shilpi Jain - The Reply = ITC will be eligible for the tax paid on development rights to the extent of the area sold before Completion - Reply By Shi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lpi Jain - The Reply = Merely because the valuation mechanism provides for the value of calculating, it would not automatically mean exemption is applicable. The exemption flows basically from the exemption entry only. When the entry itself does not provide for the exemption, support from the explanations in the notification cannot be taken. Hence no exemption for commercial units DR. - Reply ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... By deepak gulati - The Reply = Shilpi Mam In point 6 above you have mentioned that Input of GST paid under RCM by builder will be available to him, if flats are sold before completion. Since the rate is 5%, input should not be available. Please clarify thanks. - GST under RCM on Development Rights - Query Started By: - hubert fernandes Dated:- 6-4-2022 Goods and Services Tax - GST - Got 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Replies - GST - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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