Developed land sold as plots will attract GST: AAR

The Gujarat bench of the Appellate Authority for Advance Ruling has held that sale of land for which real estate developers have provided primary amenities such as drainage, waterline and electricity will attract GST. Developed plots as the ones described above are covered under the clause ‘construction of a complex intended for sale to a buyer’ and therefore are liable to attract GST. An applicant sought an advance ruling to understand if GST was applicable on the sale of a plot of land for which the applicant provided primary amenities such as a drainage line, a water line, an electricity connection, land levelling etc. The Gujarat bench observed that the price of the amenities would be included while selling the plot and therefore, should attract GST. Experts have suggested that this ruling will take away the neutral status awarded to developed plots and is likely to have an adverse impact on real estate sales.