The Madhya Pradesh Authority of Advance Ruling (AAR) ruled that no GST payable on sale of developed land where development work is limited to providing common amenities, no development work after sale.
The Applicant, Bhopal Smart City Development Corporation Ltd is a Public Sector Undertaking. The company is jointly owned by the Government of MP and is equally managed by Madhya Pradesh Urban Development Company Limited (MPUDCL) and Bhopal Municipal corporation (BMC). The sole objective of the Applicant is Planning and implementing the “Smart City Project” in Bhopal. Smart City Bhopal Mission and values: The smart city mission of the Government of India seeks to address the issue of urbanization through the transformation of selected cities. The intent is to create sustainable cities that can provide a good quality life to its citizens.
The applicant has sought the advance ruling on the issue of whether GST is applicable on sale of developed plot of land for which consideration is received before the issuance of completion certificate.
The Coram of Manoj Kumar Choubey and Virendra Kumar Jain ruled that regarding applicability of GST on sale of developed land (the applicant has declared that no completion certificate is required for the project), the sale of developed land, by the applicant as per the facts provided by him where the development work is limited to providing common amenities ( common drainage, water line, electricity line, land levelling, road and street light) and no development work will be done by the applicant after the sale of the developed land and if no advance from the customer for undertaking development activities is taken then it does not constitute a supply within the meaning of Section 7 of the GST Laws and therefore GST is not applicable on such sale.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan AdFree. Follow us on Telegram for quick updates.
