M/S. INDO AUTOTECH LIMITED

Permission for withdrawal of Advance Ruling application – levy of GST on lease amount – developer has taken the entire land from state of Rajasthan to further lease out to Industrial units – HELD THAT:- Since the applicant has withdrawn the application, therefore no ruling is given.

No.- AAR No. RAJ/AAR/2019-20/15

Dated.- July 8, 2019

J.P. MEENA AND HEMANT JAIN MEMBER

Present for the applicant: Shri Manoj Mohanty and Shri Harish Kumar Dixit (Authorised Representatives)

Note: Under Section 100 of the CGST/RGST Act, 2017, an appeal against this ruling lies before the Appellate Authority for Advance Ruling constituted under section 99 of CGST/RGST Act, 2017, within a period of 30 days from the date of service of this order.

  • At the outset, we would like to make it clear that the provisions of both the CGST Act and the RGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the RGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act / RGST Act would be mentioned as being under the “GST Act”.
  • The issue raised by M/s. Indo Autotech Ltd., Plot No. DTA 01/0203-04, Phase-II, Mahindra World City, Tehsil- Sanganer, Jaipur, Rajasthan 302037 (hereinafter the applicant) is fit to pronounce advance ruling as it falls under the ambit of the Section 97(2) (b) given as under:

b. Applicability of a notification issued under the provisions of the act;

  • Further, the applicant being a registered person (GSTIN is 08AABC16282N2Z1 as per the declaration given by him in Form ARA-01) the issue raised by the applicant is neither pending for proceedings nor proceedings were passed by any authority. Based on the above observations, the applicant is admitted to pronounce advance ruling.

1. SUBMISSION AND INTERPRETATION OF THE APPLICANT:

The applicant has purchased industrial plots in Mahindra World City located in Tehsil- Sanganer, Jaipur, Rajasthan 302037 on long term lease. The developer i.e. M/S Mahindra World City has charged GST 18% on lease premium value of industrial plots under HSN 997212.

2. QUESTIONS ON WHICH THE ADVANCE RULING IS SOUGHT

Whether M/s. Mahindra World City (a developer) who has taken the entire land from state of Rajasthan to further lease out to Industrial units (applicant is one of the industrial unit) is liable to charge GST on the lease amount?

3. PERSONAL HEARING

In the matter personal hearing was granted to the applicant on 04.07.2019 at Room no. 2.29 NCRB, Statue Circle, Jaipur. Shri Manoj Mohanty and Shri Harish Kumar Dixit (Authorised Representatives) of applicant appeared for PH. During the PH, they submitted that they have more clarification regarding issues they raised in the application and therefore requested to withdraw their advance ruling application.

4. COMMENTS OF THE JURISDICTIONAL OFFICER

The jurisdictional officer (Deputy Commissioner, CGST Division-G, Sector-10, Vidyadhar Nagar, Jaipur, Rajasthan 302005) has submitted his comments vide e-mail dated 31.05.2019 which can be summarized as under:

In this regard it is stated that Entry No. 41 of Exemption Notification No. 12/2017-CT (rate) as clarified by TRU’s letter F. No. 354/27/2019-TRU dated 30.04.2019 provides for exemption from GST to lease money, price/upfront payment (called as premium, salami, cost, price, development charges or by any other name) payable in respect of service by way of granting of long term lease (of thirty or more years) of industrial plots or plots for development of industrial infrastructure for financial business provided by the state government Industrial Development Corporation or Undertaking or by any other entity having 50% or more ownership of Central Government, State Government, Union territory to the industrial units or the developers in any industrial or financial business area. In the present case long term lease has been claimed to have been granted by M/S Mahindra World City (Jaipur) Ltd. which is not a state government Industrial Development Corporation or Undertaking or by any other entity having 50% or more ownership of Central Government, State Government, Union territory to the industrial units or the developers in any industrial or financial business area. The fact that RIICO is a shareholder in said leasing company does not equate it with RIICO. Therefore, in the opinion of this office, no exemption from GST is admissible in the present case.

5. FINDINGS, ANALYSIS & CONCLUSION:

Shri Manoj Mohanty and Shri Harish Kumar Dixit (Authorised Representatives) of applicant appeared for PH. During the PH, they requested to withdraw their advance ruling application and submitted an application dated 04.07.2019 in this regard.

6. In view of the foregoing, we rule as follows:-

RULING

Since the applicant has withdrawn the application, therefore no ruling is given.

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