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TMI Blog2022 (7) TMI 503X X X X Extracts X X X X X X X X Extracts X X X X ..... annual instalments @ 16% p.a rate of interest duly providing 2 years moratorium period. The entire interest income on the balance land cost is being recognized in the Financial Year in which the sale agreement is executed. The applicant sought clarification regarding the taxability of the interest amount receivable on the balance land cost. In the instant case the applicant, APIIC had given a facility to the beneficiaries, by extending the service of fixation of annual instalments with an interest Pi 16 /o p.a for delayed payment of 75% of total consideration over a period of time. In such a case, the interest on the credit facility allowed by the applicant is part of the value of taxable supply and shall be liable to GST. - AAR No. 0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on satisfaction of certain allotment conditions by the entrepreneur. With regard to the balance amount of the land cost, the same will be collected from the entrepreneur in annual installments along with interest duly providing moratorium period. The applicant had filed an application in form GST ARA-01 dated 20.12.2021 by paying required amount of fee for seeking Advance Ruling on the following issues, as mentioned below: 4. Questions raised before the authority: The applicant seeks advance ruling on the following: APIIC allots the land to the SC/ST/BC entrepreneurs by collecting 25% of the land cost from the entrepreneurs at the time of allotment of land and the sale agreement for the same will be executed on satisfaction of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supply of services as per schedule III of the Act. 6. Virtual Hearing: The proceedings of Hearing were conducted through video conference on 29 - June, 2021, for which the authorized representative, Ms Vishnu Priya Dumpa attended and reiterated the submissions already made. 7. Discussion and Findings: We have examined the issues raised in the application. The taxability of the goods and services supplied or to be supplied, as governed under the provisions of respective GST Acts are examined to decide the question involved in the present Ruling. As seen from the application, it is clear that APIIC allots the land to the SC/ST/BC entrepreneurs by collecting 25% of the land cost from the entrepreneurs at the time of allotmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e applicant and beneficiaries. Now we examine whether the 'interest' component in the above transaction would form a part of taxable supply as per Section 15 (2) (d) which reads as under, Value of taxable supply (2) The value of supply shall include--- (a)------ (b)---- (d) interest or late fee or penalty for delayed payment of any consideration for any supply; and In the instant case the applicant, APIIC had given a facility to the beneficiaries, by extending the service of fixation of annual instalments with an interest Pi 16 /o p.a for delayed payment of 75% of total consideration over a period of time. In such a case, the interest on the credit facility allowed by the applicant is part of the val ..... X X X X Extracts X X X X X X X X Extracts X X X X
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