Page 22 - GSTL_6th August 2020_Vol 39_Part 1

GST AND TRANSACTIONS IN
IMMOVABLE PROPERTIES
By
B.N. Gururaj, B.A., LL.B.
ADVOCATE

GST is a field of law which has remained a green-
field, even three years after its introduction. Barring the
circulars issued in the wisdom of the CBIC and erratic
rulings of the Authorities for Advance Ruling and the
Appellate Authorities, counsels and taxpayers have no
source of authoritative pronouncement on the deluge of issues arising under the
GST laws.
One such area where confusion and ignorance reign supreme is the ap-
plicability of GST in transactions involving immovable property. So far, it would
seem that taxpayers and consultants are unable to come to grips with property
laws. Poor quality of arguments can be seen by anyone who cares to read the
orders. It is axiomatic in legal practice that a poorly argued case will never beget
good judgment. I shall illustrate this by reference to a recently reported order of
AAR, Gujarat.
In Re : Dipesh Anil Kumar Naik, AR No. GUJ/GAAR/2020/11, dated 19-5-
2020 [2020 (38) G.S.T.L. 352 (A.A.R. - GST - Guj.)] is an instance of rulings issued
without proper understanding of property laws. The order doesn’t even record
all the essential particulars. This is a case where the applicant develops plots and
sells them. The AAR has ruled that the activity of sale of developed plots would
be covered under the clause “construction of a complex intended for sale to a
buyer”; that it is Construction service, that GST would be payable on the devel-
oped plots.
In the opening paragraph of this order, the AAR records “the applicant is
GST LAW TIMES  6th August 2020  22