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GST ON SALES OF FLAT

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ishan ali

42 Points Posted on 29 June 2020

As we know that rate of gst has been reduced to 1% and 5% on sale of affordable and non affordable housing projects.
My confusion - is gst payable on sales of flat where consideration has been received after obtaining completion certificate ?.
if gst is not applicable in the above case then where the explanation has been give. plz give some reference rules or section.

Replies (2)

Quick Summary

This discussion clarifies when GST is applicable on the sale of flats. GST is not payable on flats where the Completion Certificate (CC) or Occupation Certificate (OC) has been obtained from the competent authority, as the sale of a completed building is not considered a 'supply' under the CGST Act 2017. If consideration is received after obtaining the CC/OC, GST is not attracted. However, GST at 1% or 5% is applicable if consideration is received during the booking or construction stage, as this is treated as a supply of services.

Shivam RC

Student

7666 Points Posted on 30 June 2020

No Ishan Sir. GST is not applicable on Sale of Flats where Completion Certificate ( CC ) / Occupation Certificate ( OC ) has been received from the competent authority. GST will not be attracted on the consideration received after obtaining CC of the Flat.

If the consideration was received during Booking / Construction stage, then GST @ 1% or 5% would be applicable as the same is treated as Supply of Services by virtue of Para 5 clause (b) of SCHEDULE II of the CGST Act 2017.

As per Para 5 of SCHEDULE III of the CGST Act 2017, "Sale of Land and subject to clause (b) of Para 5 of SCHEDULE II, SALE OF BUILDING," is neither treated as Supply of Goods nor Supply of Services.

Hence GST is not applicable on Sale of completed Buildings as it is not a SUPPLY.

NOTE : The TAXABLE EVENT under GST is "SUPPLY OF GOODS or SUPPLY OF SERVICES".

Regards,
Shivam RC.