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Construction complex intended for sale

28 March 2020

when a construction complex is to be sold , no GST is applicable if consideration is paid after 1st occupation or receiving completion certificate- whichever earlier
Knowing this every person will not be paying consideration till either of the two conditions complete and not be paying gst.
Isn't it a loophole or what is it?

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5 Replies

Kishor Lulla (784 Points)
Replied 29 March 2020

Legally allowed. can call loophole or benefit

Pankaj Rawat (GST Practitioner) (55032 Points)
Replied 29 March 2020

Dear
complete Consideration is received after obtained CC, GST is leviable.

Earlier the Builder/Promotor need to Reverse the ITC in case where he received consideration for particular flat being sold after CC ,but As from 1/4/2019, The Rate has been revised which is 1% ,5% without ITC . So now ITC is not required to reversed in such cases , but ... as you know that huge amount money is involved in construction of Buildings , so if builder do no approach for advance booking from customer , he might be short of funds, means short of working capital . So I don't think that any Promotor will refuse to take Advance because of liability GST.