CLASSIFICATION OF SALE OF BUILT-UP AREA BY NBCC UNDER GST: NOT AN AGENT OF MoHUA, LIABLE TO PAY 18% GST
DELHI APPELLATE AUTHORITY FOR ADVANCE RULING
GOODS AND SERVICE TAX
Before the AAAR comprising of:
Smt. Mallika Arya, Member (Centre)
Dr. S. B. Deepak Kumar, Member (State)
Case Title: M/s NBCC (India) Limited
(GST AAAR DELHI)
Order No. 04/DAAAR/202223 /2981-2986
Advance Ruling Order against which- 07/DAAR/2018 dated 05.10.2018
Date of Judgement/Order: 20th Febrary 2023
BRIEF FACTS OF THE CASE
Para No. 3.1 The Appellant is a Government of India enterprise and engaged in project management consultancy, real estate development and EPC contracts. They have has signed a memorandum of understanding on 25.10.2016 with Ministry of Housing and Urban Affairs (MoHUA), Govemment of India, wherein MoHUA has appointed the Appellant as the executing agency for redevelopment of colonies having “General Pool Residential Accommodation” (in short GPRA) and “Government Pool Office Accommodation” (in short GPOA) at Nauroji Nagar, Sarojini Nagar and Netajl Nagar in Delhi. Under this arrangement, the Appellant is required to organise construction of GPRA (i.e, dwelling units), GPOA (i.e. office spaces), commercial space and supporting infrastructure, such as local convenience shopping centre, banquet hall/ community centre, creche, schools, hospital/dispensary, ATM/Banks, parking facilities, parks and play grounds etc. at the specified locations in place of old existing buildings. The Appellant Is also required to maintain the constructed buildings for a period of thirty years after construction. The transactions between the Appellant and MoHUA under the said MOU is not a subject matter before this authority.
Para No. 3.4.The Appellant had applied to Real Estate Regulatory Authority (RERA) on behalf of MoHUA, Govemment of India, for registration under the Act, but the Regulator had refused to give such registration in its letter dated 11.08.2017. In this letter, it has been stated that application by the present Appellant (i.e. NBCC) for registration of the project considering MoHUA as the promoter cannot be accepted. In these circumstances, the Appellant applied for registration under RERA as per instruction of MoHUA. In the above mentioned factual background, the Appellant had sought advance ruling in respect of any GST liability on sale of built-up area on behalf of MoHUA in the colonies redeveloped by it for MoHUA.
Para No. 14. The fourth issue in the present appeal relates to the appellant’s liability 10 pay GST on a consideration received under an agreement involving sale of constructed units in a building which is under construction. The appellant has reiterated the plea already advanced before the DAAR and the same have been sufficiently addressed by the authority while passing the impugned Order. Therefore, we do not see any reason to go to this aspect any further.
Para No. 15.In view of above discussion and findings, it is clear that there is no merit in the appeal filed by M/s NBCC(India) Ltd. against the Order No. 07/DAAR/2018 dated 05.10.2018 passed by Delhi Authority for Advance Ruling. The said Order is proper and legal and there is no reason to interfere with it. We, therefore, pass the following Order:
ORDER
The Order dated 05.10.2018 of Delhi Authority for Advance Ruling is upheld. The appeal filed by M/s NBCC (India) Ltd., is dismissed being devoid of merit.
