Gst liability of land owner- development agrmnt with builder

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

23 September 2017 Hello Sir

Need your help and suggestion

I have entered into a development agreement with a builder to develop our land for residential apartment on 50:50 ratio. The development agreement and supplementary agreement is completed with the builder and the allotment of flat ( Land owner and Builder) share details is also registered with Sub-Registrar office at Hyderabad before 1 July 2017. The apartment is now under final stage of construction and possession certificate is not yet received.

Now Builder is advising us that we need to pay GST on our share of flats, request you to please advise is the GST applicable to us or not, as the supplementary agreement is already completed before the implementation of GST on 1st July 2017. Your help and your suggestions would be appreciated.

Request you to please revert with your advise. Thanks.

Note: In development agreement it was agreed that the builder would bear all the taxes and charges applicable for the development of apartment.

Thanks
Nitin

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

24 September 2017 GST applicable to you at 18% on value of flats allotted to you excluding the land value. Date of development agreement is irrelevant. When you sell the flat claim it as ITC and charge 12% GST including land value.
As per agreement if builder agreed to bear the taxes then he has to pay GST on the flats allotted to you.

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