Page 59 - GSTL_2nd July 2020 _Vol 38_Part 1

2020 ] NEWS DESK J33
instead of having different codes for different types of parota. Since the rates of
tax are only around 7 or 8, there is no necessity for the HSN Code to nit-pick as
to how aluminium rods are cut.
We can only hope another AAR does not rule that the variety of parota
called Ceylon Parota has to suffer both Customs Duty and IGST because it has a
foreign name. They may also be asked the question - what would be the GST rate
if ID Foods puts a label “Indian Bread” on the outside of the packet and two fro-
zen parota inside? It is time the GST Council got real and gave out instructions to
simplify the HSN Code.
As on date, if taxpayers were quizzed as to whether the erstwhile system
of indirect taxes was better than GST, it would not be a surprise if the majority
said ‘yes’. The GST Council has its work cut out on trying to reverse this opinion.
[Source : Mohan Lavi in Deccan Herald, Bengaluru, dated 26-6-2020]

Developed land sold as plots will attract GST : AAR
GST will be levied on sale of land for which primary amenities - such as
drainage, waterline and electricity - have been provided by real estate developer,
the Authority for Advance Ruling (AAR) has said.
The AAR has also concluded that sale of developed plots will be covered
under the clause ‘construction of a complex intended for sale to a buyer’ and ac-
cordingly GST would be levied.
An applicant had approached the Gujarat Bench of AAR on whether
Goods and Services Tax (GST) is applicable on sale of plot of land for which, as
per the requirement of approved by the respective authority (i.e., Jila Panchayat),
primary amenities such as, drainage line, water line, electricity line, land level-
ling, etc. are to be provided by the applicant.
We find that the activity of the sale of developed plots would be covered
under the clause ‘construction of a complex intended for sale to a buyer’. Thus,
the said activity is covered under ‘construction services’ and GST is payable on
the sale of developed plots..., the AAR said.
The AAR, while passing the ruling, said that the applicant sells the de-
veloped land as plots and the sale price includes cost of land, as well as price of
amenities on a proportionate basis.
AMRG & Associates Senior Partner Rajat Mohan said this ruling would
have a direct, immediate, and adverse impact on the entire real estate sector,
which intends to take away the tax neutral status awarded to the sale of devel-
oped plots.
[Source : Millennium Post, New Delhi, dated 22-6-2020]

Goods supplied to an overseas customer by an overseas
vendor of an Indian firm will attract IGST
Integrated Goods & Services Tax (IGST) will be applicable on goods
directly shipped to overseas customers from vendors’ premises outside India, an
Authority for Advance Rulings (AAR) has said.
The applicant, Sterlite Technologies, approached Gujarat AAR with two
GST LAW TIMES  2nd July 2020  59