GST CIR NO.101/20/2019 DATE 30/04/2019
GST exemption on the upfront amountpayableininstallmentsforlong term lease of plots, under Notification No. 12/2017 –Central Tax (R) S. No.41 dated 28.06.2017 -reg.
Representations have been received by the Board seeking clarification regarding admissibility ofGST exemption on the upfront amountwhich is determined upfront but is paid or payablein installmentsfor longterm (thirty years, or more) lease of industrial plotsor plots for development of financial infrastructure under Notification 12/2017 –Central Tax (R) S. No.41 dated 28.06.2017.
2. The matter has been examined. The entry at S. No.41 of Notification 12/2017 –Central Tax (R) dated 28.06.2017readsas under:
|
Sl. No |
Chapter, Section, Heading, Group or Service Code (Tariff) |
Description of Services |
Rate (per cent.) |
Condition |
|
(1) |
(2) |
(3) |
(4) |
(5) |
|
41 |
Heading 9972 |
“Upfront amount (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 years, or more) of industrial plots or plots for development of infrastructure for financial business, provided by the State Government Industrial Development Corporations or Undertakings or by any other entity having 50 per cent. or more ownership of Central Government, State Government, Union territory to the industrial units or the developers in any industrial or financial business area.” |
NIL |
NIL |
3. It is hereby clarified that GST exemption on the upfront amount (called as premium, salami, cost, price, development charges or by any other name) payable for long term lease (of thirty years, or more) of industrial plots or plots for development of infrastructure for financial business under Entry No. 41 of Exemption Notification 12/2017 –Central Tax (R) dated 28.06.2017 is admissibleirrespective of whether such upfront amount is payable or paid inone or moreinstalments, providedthe amount is determined upfront.
4. Difficultyif any, in implementation of this Circular may be brought to notice of the Board.
Yours Faithfully,
(Shashikant Mehta)
OSD, TRU
Email: shashikant.mehta@gov.in
Tel: 011 2309 5547
F. No. 354/27/2019-TRU
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