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TMI Blog2024 (10) TMI 191X X X X Extracts X X X X X X X X Extracts X X X X ..... y of extending loans by HDFC Bank to the applicant against consideration payable in the form of interest is an inward supply of exempted services of the applicant. Such services, therefore, would be a part of total inward supply for the purpose of computing the threshold limit of 80% and since HDFC Bank is a registered person under the GST Act, the supply admittedly has been made from a registered person. - DR TANISHA DUTTA AND JOYJIT BANIK, MEMBER Applicant s Representative Heard : Mr. Sanjoy Todi (Partner). Preamble A person within the ambit of Section 100 (1) of the Central Goods and Services Tax Act, 2017 or West Bengal Goods and Services Tax Act, 2017 (hereinafter collectively called the GST Act ), if aggrieved by this Ruling, may ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion (1) of section 97 of the GST Act and the rules made there under seeking an advance ruling in respect of following questions: (i) Whether interest charges by HDFC Bank Ltd should be treated as inward supply from registered suppliers for calculating threshold of 80% since HDFC Bank Ltd is a registered company. 1.4 The aforesaid question on which the advance ruling is sought for is found to be covered under clause (b) and (e) of sub-section (2) of section 97 of the GST Act. 1.5 The applicant states that the question raised in the application has neither been decided by nor is pending before any authority under any provision of the GST Act. No reply from the revenue in this respect has been received. 1.6 The application is, therefore, admi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... personal hearing. 4.2 In terms of Notification No. 03/2019-Central Tax (Rate) dated 29.03.2019, supply of services for construction of affordable residential apartments by a promoter in a Residential Real Estate Project (herein after referred to as RREP) which commences on or after 1st April, 2019 or in an ongoing RREP in respect of which the promoter has not exercised option to pay tax at a higher rate of 12% or 18%, as the case may be, attracts tax @ 1% subject to certain conditions which inter alia includes as follows: eighty percent of value of input and input services, [other than services by way of grant of development rights, long term lease of land (against upfront payment in the form of premium, salami, development charges etc.) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the registered person namely Promoter shall pay tax on reverse charge basis as recipient of goods or services or both, as specified in the said notification, when received from an unregistered supplier. SlNo. Category of supply of goods and services Recipient of goods and services (1) (2) (3) 1. Supply of such goods and services or both [other than services by way of grant of development rights, long term lease of land (against upfront payment in the form of premium, salami, development charges etc.) or FSI (including additional FSI)] which constitute the shortfall from the minimum value of goods or services or both required to be purchased by a promoter for construction of project, in a financial year (or part of the financial year till th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a promoter has to pay tax @ 18% on reverse charge basis on all such inward supplies (to the extent short of 80% of inward supplies from registered supplier) except cement on which tax has to be paid at the applicable rate (currently @ 28%) by the promoter on reverse charge basis. The specified limit of eighty percent includes value of inputs and input services both. In regard to input services, such value however shall not include value of services by way of grant of development rights, long term lease of land (against upfront payment in the form of premium, salami, development charges etc.) or FSI (including additional FSI). This has been clarified in the FAQs (Part II) on real estate issued by the Tax Research Unit, Department of Revenue, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll exclude services by way of grant of development rights, long term lease of land (against upfront payment in the form of premium, salami, development charges etc.) or FSI (including additional FSI) and value of electricity, high speed diesel, motor spirit, natural gas. However, the total value of supply shall include inward supplies of exempted goods / services and the promoter shall compute the threshold of 80% of inwards supplies accordingly. 4.7 The issue involved in the instant case is to decide whether interest charges by HDFC Bank Ltd should be treated as inward supply from registered suppliers for calculating threshold of 80%. Services by way of extending deposits, loans or advances in so far as the consideration is represented by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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