Impact of gst on transfer of development rights

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This query is : Resolved

uppathala ramarao (Querist)

08 May 2019 We are entered into a development aggrement for construction of Residential Apartments on 27 th Mar 2017 by sharing of construted area in the ratio of 40:60 between Land owner and Developer Respectively. Now developer is paying GST of 12% on flats sold by taking input. developer is estimating that project will completed by with in one year (i.e 31.12.2019) our doubt is about is there any service tax or GST on transfer of devlopment rights on 27.May 2017 or hand over of constructed flats to land owner after completion of constructed flats. if there is no GST on transfer of devlopment right can we claim input on the materials used for construction of land owner portion.Right now is there any liabilty on developer to pay gst or service tax on rights transfered by way of RCM and can the devloper take a input on materials used for construction of land owner portion. please suggest me what the developer can do now.

Rajesh Kumar

Rajesh Kumar (Expert)

10 May 2019 There shall be GST on sale of development rights. However, tax liability is on reverse charge, and the developer shall pay the GST on reverse charge and take credit. When you shall get possession of the are, GST shall be paid on value of the area.

uppathala ramarao

uppathala ramarao (Querist)

11 May 2019 Sir but its transfer of development right before gst

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