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TMI BlogTaxability of letting out commercial premises to registered person by an URPX X X X Extracts X X X X X X X X Extracts X X X X ..... In light of the recent amendment vide notification no. 9/2024 CT(R) dated 08.10.2024 , whether a registered person will be required to pay tax under RCM if the commercial property has been taken on consent i.e. without consideration? will there be different implications of this arrangement in cases where the property is owned by a related person? Thanks - Reply By Sadanand Bulbule - The Reply = De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar Sir It can be understood from your query that, there is no supply of services to the recipient in terms of Section 7[1] in the absence of consideration . GST Act does not speak about consent . Thee cannot be usage of commercial property by somebody without the consent of owner. Otherwise it amounts to trespassing and illegal. Secondly you have to take care of entry No. 2 of II Schedule as far a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s such issue between related persons is concerned. - Reply By KASTURI SETHI - The Reply = I concur with the views of Sh.Sadanand Bulbule Sir Ji. In this scenario, the related person clause mentioned in Para No.2 of the Schedule-I comes into play. Also read Para nos.2 5 of Schedule-II . - Reply By Shilpi Jain - The Reply = If property taken on consent without any consideration From unrelated person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - no GST liability From related person - liable to GST under RCM. - Reply By Rajat Gupta - The Reply = I agree that we have to refer schedule 1 in cases where consideration is not involved. But can we argue that letting of property by URP on consent is not in the 'course of furtherance of business' by such URP and this does not constitute supply? - Reply By KASTURI SETHI - The Reply = Qua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lifies the term, 'furtherance of business'. - Reply By KASTURI SETHI - The Reply = Emphasis is laid on the words, 'Any trade' mentioned in the definion of 'business' in CGST Act . Also focus on interpretation of the word, ''furtherance'. - Reply By Rajat Gupta - The Reply = But sir, shouldn't the phrase furtherance of business be assessed from the point of v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iew of the URP who is giving property on consent? - Reply By Shilpi Jain - The Reply = Forget about letting out. If thats not the servicein this case, still there is something or some permission/license or at least favour done by giving consent. this would fall under ambit of services. Further, business def is pretty wide in GST and can cover this scenario as the related person sees some business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sense or requirement in giving this consent. - Taxability of letting out commercial premises to registered person by an URP - Query Started By: - Rajat Gupta Dated:- 9-10-2024 Last Replied Date:- 31-10-2024 Goods and Services Tax - GST - Got 8 Replies - GST - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t - 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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