GST could not be levied on Upfront Amount payable in Instalments for Long Term Lease of Plots [Read Circular]

The Central Board of Indirect Taxes and Customs ( CBIC ) has clarified that, Goods and Services Tax ( GST ) could not be levied on upfront amount payable in instalments for Long Term Lease of plots.

In a Circular issued by the CBIC said that, “GST exemption on the upfront amount (called as premium, salami, cost, price, development charges or by any other name) payable for long term lease (of thirty years, or more) of industrial plots or plots for development of infrastructure for financial business under Entry No. 41 of Exemption Notification 12/2017 – Central Tax (R) dated 28.06.2017 is admissible irrespective of whether such upfront amount is payable or paid in one or more instalments, provided the amount is determined upfront”.