Quick Summary
The Supreme Court has stayed a Goods and Services Tax (GST) demand raised on a real estate project executed under a Joint Development Agreement (JDA), amove that could have far-reaching implications for developers and landowners across India. A bench comprising Justices Aravind Kumar and R. Mahadevan passed the interim order earlier this month, staying the operation of an assessment order dated January 27, 2025, issued by the CGST and Central Excise, Nashik-I Division against Arham Infra Develo
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FAQ :
The Supreme Court has issued an interim stay on a Goods and Services Tax (GST) demand raised on a real estate project executed under a Joint Development Agreement (JDA).
A JDA is a common real estate model where landowners contribute land and developers build a project, with profits or units shared afterwards.
Tax authorities view the transfer of development rights (TDR) in a JDA as a taxable service, while developers argue that land transfers are excluded from GST.
The Bombay High Court had previously declined to stay the GST demand, suggesting developers pursue remedies through statutory appellate authorities first.
Experts argue that taxing development rights indirectly taxes land, which is outside the scope of GST, potentially leading to double taxation.
The stay could set a significant precedent for thousands of similar real estate projects and clarify the taxability of complex land transactions under GST.
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