Taxability Of The Joint Development Agreement (Jda) Under Gst- Part 2

Escrito por: Redacción    13 abril 2021     3 minutos

Sir, how can ITC be used by landowners to defer payment of GST after the completion of the dwelling? Please explain in there is something waay out if the apartments received by the developer are not sold before CC. 1) Calculate the value on the transfer date of the operating rights for the entire project area, taking into account the value calculated for a similar dwelling by the independent buyer close to the transfer date of these operating rights. Schedule-II`s Entry 5 (b) explanatory note made it mandatory to have the meaning of «competent authority» that can issue a graduation certificate or a professional certificate. It provides that, in cases where the certificate is not issued by a government authority, the certificate issued by a chartered architect or engineer or a certified surveyor must be considered a certificate of completion and must therefore take into account the date of issuance of the certificate. It is therefore a specific question of the state/city council/local authority and each state/UT has its own law for issuing such a certificate. But in the real world, it takes years to obtain the certification of completion of the government agency, even if the actual completion of the project goes back a long time. At this time, the apartments are occupied by owners and inhabited by them. In such a situation, without state testimony, it becomes really difficult to determine the exact date on which the project was completed or occupied first. As a general rule, the developer only issues property letters after receiving a certificate of completion from the architect/engineer. Therefore, the date of the «first occupation» will only be after the date of issuance of the «year-end certificate.» This will be the date of the issuance of the «year-end certificate» which will be the decisive date for determining the tax capacity of the units. If it is available or issued by the government (where applicable), then there is no dispute. But the difficulty comes from determining the first real occupation. Nor should we ignore the date of possession of the surrender as the date of the first occupation.

The Hon`ble Delhi High Court in the case of J.K. INDUSTRIES LIMITED VERSUS MOHAN INVESTMENTS ( PROPERTIES PRIVATE LIMITED LIMITED (1991 (4) TMI 458 – DELHI HIGH COURT) found that if the «first occupation» takes place before the issuance of the «certificate of completion», especially when such a certificate is to be issued by the government authority. In such cases, the date of the first occupation is the reference date, even if the occupation is granted in violation of other laws. The TDR is none other than the development potential or the ISF of the TDR zone is given in the form of DRC, i.e. Development Rights Certificate. TDR or DRC is negotiable and can be transferred for a fee. The owner of acquired land can either use the TDR for himself or sell it on an open market. GST on FSI was first introduced in 2018, the responsibility for the payment of GST to the registered owner for whom the ISF was transferred to the developer for whom the consideration was received in the form of housing. The GST was payable for the transfer of such dwellings at the time of entry into a «promotion.» (Noti 4/2018 – CGST rate) The answer to the question above is: yes, an expert who pays development rights to GST can apply for a loan under the CGST Act 2017. In the case of MAARQ Spaces (P.) Ltd., 2019 (11) TMI 994 – AUTHORITY FOR ADVANCE RULING, KARNATAKA Applicant has entered into a joint development agreement with landowners for the development of residential complex land and development costs is borne by the applicant.


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