Fact:- M/s Punjab Small Industries & Export Corporation Limited (“the applicant”) is a State Government owned Industrial Development Undertaking is engaged in providing lease of Industrial plots against one time upfront amount (called as premium, salami, cost, price, etc) to the industrial units which is exempt from GST vide Entry No. 41 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017. Further, the applicant also provides ancillary services relating to the industrial plots namely: Transfer Fees, Extension Fees, Conversion Fees, Processing Fees, Bifurcation Fees, etc.
Issue Involved: – The applicant is seeking an advance ruling that whether the ancillary services relating to the industrial plots namely; Transfer Fees, Extension Fees, Conversion Fees, Processing Fees, Bifurcation Fees etc are exempt GST vide Entry No. 41 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017?
Applicant Contention of Law:- The applicant contended that these services are inter-linked with the services of providing lease of industrial plots against one time upfront amount (called as premium, salami, cost, price, development charges or by any other name) to the industrial units which is exempt from GST vide Entry No. 41 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 is exempt from GST. Therefore, these ancillary services should also be exempt from GST.
Held:-The Hon’ble AAR of Chandigarh vide Advance Ruling No. CT/01/A.R./CHD/2018/8042 dated November 8, 2018 stated that, additional services provided by applicant, though are in respect of same plots but Entry No. 41 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 grants exemption only to upfront amount (called as premium, salami, cost, price, development charges or by any other name) and does not provide exemption to all services related to plots. Further the said services are covered under “Other Miscellaneous services”-Group 99979 [scheme of classification of services in the Annexure to Notification No. 11/2017-Tax (Rate)] and taxable at 18% (CGST + UTGST).
Citation: TS-684-AAR-2018-NT