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Indirect Taxation
please explain the meaning of of attached Parras
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Supply of development rights is taxable and under RCM so the developer (recipient) pays output tax thus supplier cannot charge GST. If flats assured to landowner by developer (as consideration against development rights) are sold /title transferred before completion certificate the TDR/ FSI is taxable but if the flats are transferred to landowner after completion certificate then TDR is exempt. For the flats sold by the developer before completion certificate then the developer will charge GST at the rate of 1%, 5%, 12% for the affordable (carpet area of 60 sq mt in metros and 90 sq mt in other cities gross amount charged by the builder is not more than Rs.45 lakhs), non-affordable, commercial projects. For the flats sold by the developer after issuance of completion certificate then the developer will not charge GST as it is exempt.