GST on sale of land in exchange of apartments

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... GST on sale of land in exchange of apartments
Query (Issue) Started By: - Narayan Pujar Dated:- 18-12-2024 Last Reply Date:- 24-12-2024 Goods and Services Tax - GST
Got 3 Replies
GST
Hi, In a JDA, a landowner transfers the development rights to developer in exchange of newly constructed apartments. GST law provides for taxability in such cases. However, the other day I heard of an a .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... greement wherein the landowner has sold the land through a sale deed in exchange of apartments/shops. In this, since one leg involves direct land transfer, it would not be liable to GST as per Schedule III. My question is: Since direct land transfers are exempt under GST, why do people prefer Joint Development Agreements (JDAs) over outright land sales, even though development rights in a JDA att .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ract GST? Additionally, the second leg of the transaction remains the same in both cases. Could this preference be due to implications under other laws? If yes, then what would they be? Reply By Sadanand Bulbule: The Reply: Dear Once there is an outright sale of land to the developer, the question of "Transfer of Development Right" attracting GST liability does not arise.However JDA .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... might be for various other factors. Every JDA need not attract tax liability. Reply By Shilpi Jain: The Reply: Without receiving any consideration, the landowner would be at the mercy of the developer if he would execute a sale deed for a consideration to be received in the future. That's why they execute a JDA. Reply By Manoj Thakur: The Reply: Also depends on whether the land owner's .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... rights are leasehold or freehold. Situation was different pre 1.4.2019 when 6 notifications in related matters attempted to define a clearer path. In both service tax and GST regimes, handling of society redevelopment transactions has been has been open to doubts. Supreme Court's validation of the Vasantha Green Projects case is expected to clear the matter on service tax at least. Extension .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... to GST may come in future, till when such notices and orders are expected to continue to litigate.
Discussion Forum - Knowledge Sharing .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X