As per GST law, construction of complex, building, civil structure or a part there of including a complex or building intended for sale to a buyer ,wholly or partly ,except where the entire consideration has been received after issuance of completion certificate ,where required ,by the competent authority of after its first occupation ,whichever is earlier ,is a supply of service and liable to GST.

1. Sale of building is an activity or consideration which is neither a supply of services (Para 5 of schedule III of the CGST Act 2017)

2. It follows from the above facts that, sale of ready - to - move- in or completed property does not attract GST. GST is payable only on under construction property as discussed below.

Property for which completion certificate has been issued

Entire consideration has been paid to the Builder before the 1st July 2017

Party Consideration has been paid to the builder before 1st July 2017

No GST applicable on ready - move- in or completed property as per para 5(b)of schedule II of CGST Act 2017

There is no GST payable on such property even if the construction is completed after 1st July 2017. This transaction will attract Service Tax at the rate of 4.5% because as for the  point of taxation Rules 2011 applicable to Service Tax ,where the invoice was raised or payment made prior to the appointed date under GST ,the point of taxation arose before the appointed day and thus such transaction attract Service Tax not GST.

4.5% Service Tax applicable on the invoice raised or consideration paid before the 1st July 2017 .However, payment made by the  buyer to the builder on or after 1st July 2017 against invoices issued  on or after 1st July shall attract GST @12%.

Rate of GST

Effective rate of GST payable on purchase of under construction residence or commercial properties from a builder involving in transfer of interest in land or individual share of land to the buyer, is 12% with full input Tax Credit (ITC).{GST Payable @18% on 2/3rd of the amount foe the property ;1/3rd of the amount having been deemed as value of land or undivided share of land supplied to the buyer}

Consideration which does not constitute transfer in land or undivided    share of land as part of consideration such as construction services provided by a sub-contractor to the builder ,attract GST at the standard.

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CA Chirag Chauhan

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    I hope by reading this article you got enlighten on ,Clarification about applicability of GST on under Construction and Realty -To - Move -In Propertyfurther to mention before taken any financial decision based on this content it is prefered to take an expert opinion as matter can be subjective.