GST by landlord after obtaining Completion certificate

GST by landlord after obtaining Completion certificate

Hello,

I entered into a DGPA with a builder in 2021. The project has 10 flats in total. The builder got 5 flats in his share and the other 5 fall under my share (landlord).
The project received completion certificate in December-2023.
Till date, I haven’t sold any unit of my share.
Recently a buyer has approached me and he claimed that he is not liable to pay GST because the project has already received CC from the competent authority.
Now the builder is insisting me to pay GST even for my share of 5 flats as he has to file GST for all the 10 flats in the project

Questions:

1. Am I supposed to collect GST from the buyers of my share of flats?
2. If answer to question no 1 is no, Then, If the builder insists me to pay GST for my share Of flats, how should I deal with this situation?
3. I also hold a GST number and even if I have to pay GST for my share, Is GST supposed to be filed on my certificate or the builder’s certificate?

Asked 3 months ago in GST

Hello,

Am I supposed to collect GST from the buyers of my share of flats? No, you are not required to collect GST from buyers of your share of the flats if you sell them after the project has received a completion certificate from the competent authority. The sale of flats post-issuance of a completion certificate is exempt from GST (TaxGuru).

How to handle the situation if the builder insists on me paying GST for my share of flats? Since GST is not applicable on your flats sold after receiving a completion certificate, the builder should not demand GST on these transactions.

Is GST supposed to be filed on my certificate or the builder’s certificate if I have to pay GST for my share? In your case, since GST is not applicable on the sale of your flats after the issuance of the completion certificate, there should be no need for filing GST under either your or the builder’s GST certificate for these transactions

For detailed, personalized advice, consider a phone consultancy.

Hope you find the information helpful. You are free to contact me for further discussion.If you could spare two minutes of your time to write a review, It would be really grateful and very happy to read it.

Thank you.

Shubham Goyal

CA, Delhi

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Thanks for the reply sir.

But the builder claims that he is liable to pay GST on a reverse charge basis. So he claims, he has to pay GST for all 10 flats irrespective of whether they are sold before obtaining CC or after obtaining CC.

From now on, Since the buyers are not liable to pay any GST, builder is insisting me to pay GST from the total sale consideration received from the buyer on sale of every flat.

Please suggest me on how to tackle this situation and how should i convince him that GST is not applicable for my share of flats?

Asked 3 months ago

1. No

2&3. On or after 01.04.2019, builder is liable to pay GST on RCM basis on un-booked units on the date of completion certificate or first occupation whichever is earlier

For detailed discussion you may opt for phone consultation

Vivek Kumar Arora

CA, Delhi

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To address the builder's GST claims, first review your Development Agreement for clauses on GST responsibilities.

Armed with this information, clearly inform the builder, supported by expert advice, that GST does not apply to your share of the flats, and you are not liable for any GST payments on these sales.

For detailed, personalized advice, consider a phone consultancy.

Thank you.

Shubham Goyal

CA, Delhi

274 Answers

4 Consultations

5.0 on 5.0

Talk to Shubham Goyal

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