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The sale of developed plots / land without receiving any advance from their customers for undertaking development activities is covered by Para 5 of Schedule III of the CGST Act and accordingly it is neither a supply of goods nor a supply of service. Therefore, such sale is not liable to GST.

Authority for Advance Ruling —Taxability on community villa projects – The applicant is engaged in promotion of gated community villa projects in the State of Kerala for the prospective villa buyers. The applicant sought an advance ruling as to whether the rate of GST applicable with effect from 01.04.2019 on promotion of villa projects for the villa buyers is 1.5% / 7.5% (effective tax rate 1%/5%) without benefit of ITC; whether the GST tax rate of 1.5% / 7.5% is applicable in their redeveloped projects undertaken after 01.04.2019 which were uncompleted and already started by developers before 31.03.2019; as to how the taxable value of construction of villa is to be calculated on the projects developed and promoted on the arrangement of agreement with landlord, landlord selling the plots directly to various villa buyers identified by them; whether out of the total value of the villa including land value, 2/3rd of the total value shall be taken for payment of GST at the rate of 1.5% / 7.5% (effective rate of 1% / 5% on the total value of villa). Held that:- The Hon’ble Authority for Advance Ruling held that the applicant is liable to pay GST at the rate of 1.5% in respect of the services of construction of affordable residential apartments as per entry at Item (i) and at the rate of 7.5% in respect of the services of construction of residential apartments other than affordable residential apartments as per entry at Item No. (ia) of SI No. 3 of Notification No. 11/2017 CTR dated 28.06.2017 subject to the conditions prescribed under the respective entries in the villa projects. The applicant is liable to pay GST at the rate of 1.5% in respect of the services of construction of affordable residential apartments as per entry at Item (i) and at the rate of 7.5% in respect of the services of construction of residential apartments other than affordable residential apartments as per entry at Item No. (ia) of SI No. 3 of Notification No. 11/2017 CTR dated 28.06.2017 subject to the conditions prescribed under the respective entries in the redeveloped projects undertaken by them after 01.04.2019. The taxable value of the construction services supplied by the applicant shall be governed by the provisions of Para 2 of Notification No. 11/2017 CTR. The sale of developed plots / land without receiving any advance from their customers for undertaking development activities is covered by Para 5 of Schedule III of the Act and accordingly it is neither a supply of goods nor a supply of service. Therefore, such sale is not liable to GST.
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