Background:
The Ministry of Finance issued Press Release dated May 28, 2021 pertaining to decisions taken in 43rd GST Council meeting wherein following recommendations were made to make appropriate changes in the relevant notification for an explicit provision to make it clear that land owner promoters could utilize credit of GST charged to them by developer promoters in respect of such apartments that are subsequently sold by the land promotor and on which GST is paid.
Following notification has been issued in this regard:
Notification:
The CBIC vide Notification No. 02/2021- Central Tax (Rate) dated June 02, 2021 to amend Notification No. 11/2017- Central Tax (Rate) dated June 02, 2021 (“Services Rate Notification”) to make following changes:
- Inserted Explanation (iii) in conditions column of serial number 3 (i.e., Heading 9954 (Construction services)) of the Services Rate Notification against items against items (i), (ia), (ib), (ic) and (id), namely:
“(iii) the landowner-promoter shall be eligible to utilise the credit of tax charged to him by the developer-promoter for payment of tax on apartments supplied by the landowner-promoter in such project”
This notification shall come into force with effect from June 2, 2021.
The CGST (Rate) Notification can be accessed at: https://www.cbic.gov.in/resources//htdocs-cbec/gst/notfctn-02-2021-2020-cgst-rate.pdf
Similar Notification has been passed under IGST (Rate): https://www.cbic.gov.in/resources//htdocs-cbec/gst/notfctn-02-2021-igst-rate-english.pdf
Similar Notification has been passed under UTGST (Rate): https://www.cbic.gov.in/resources//htdocs-cbec/gst/notfctn-02-2021-utgst-rate.pdf