Page 144 - GSTL_16 April 2020_Vol 35_Part 3

358 GST LAW TIMES [ Vol. 35
Hon’ble Appellate Authority for Advance Ruling, Maharashtra, un-
der Section 100 of the CGST Act, 2017 and Section 100 of the Maha-
rashtra GST Act, 2017, on the following grounds.
1. to 36. * * * * * *
[See text of paras 1 to 36 of this order in GST Council website.]
Personal Hearing :
37. A personal Hearing in the matter was conducted on 14-10-2019,
which was attended by Shri G. Natarajan, Advocate, on behalf of the Appellant,
as well as by Shri Manish Puliye, the Jurisdictional Officer in the instant matter,
who reiterated their respective written submissions filed before us.
Discussions and Findings :
38. We have gone through the facts of the case, documents on record
and submission made by the appellant as well as the jurisdictional officer. The
MADC i.e. Maharashtra Airport Development Authority is a Special Planning
Authority under the MRTP Act for the Multi Model International Hub Airport,
Nagpur, Mihan which includes development of Nagpur Airport as an Interna-
tional Hub Development of SEZ etc. It is seen that M/s. Chaurangi Builders and
Developers have formed a Special Purpose Vehicle (SPV), along with M/s. IJM
Realty (Mauritius) Ltd., under the name and style of M/s. Nagpur Integrated
Township Pvt. Ltd., who is the appellant in the present case. Then agreement
between MADC and the appellant dated 8-12-2017, the appellant is granted the
right to design, finance and develop a township project comprising of residential
apartments, commercial complexes, etc. on the land owned by MADC. As per
the agreement, according to the appellant, they are permitted to grant long term-
lease of the residential apartments and commercial buildings and the same can-
not be sold outright in favour of the buyers. The land on which construction is
undertaken is a leasehold land. The appellant has submitted a draft “Agreement
for Lease” which is proposed to be entered with prospective lessees. They have
drawn attention to the fact that the identified apartment unit in the residential
complex is proposed to be given on long-term lease for 99 years, expiring on
2105, against payment of lease consideration by the lessee to the appellant. It is
also seen that the agreement of lease entered into during the construction of the
complex, and the lease consideration is also payable in various instalments at
various stages of construction.
39. The AAR had to give a ruling on as to whether the activity of grant-
ing long-term lease of the residential apartment would amount to transfer of
immovable property or not? It was argued by the appellant that the activity
would amount to transfer of immovable property and hence not liable to GST. In
the alternative, it was claimed that the activity is classifiable under SAC 9972 11
as “Rental and lease services involving owned or leased residential property and
as per Sr. No. 12 of Notification 12/2017, dated 28-6-2017, “Services by way of
renting of residential dwelling for used as residence is exempted from payment
of GST. The AAR noted the following facts which are not disputed :-
(a) The appellant is granted the development rights by MADC and also
as rights to lease out the flats to the customers.
(b) The customer would be paying 10% premium as lease advances and
paying the balance in various installments.

GST LAW TIMES  16th April 2020  264