Page 67 - CA Final GST

Badlani Classes

EXEMPTIONS : REAL ESTATE SERVICES / RENTING OF IMMOVABLE
PROPERTY

Real estate services includes-
➢ Real estate services-
Real estate services involving owned or leased property:
Rental or leasing services involving own or leased residential / non-residential
property;
Trade services of buildings; Trade services of time-share properties;
Trade services of vacant and subdivided land.
➢ Real estate services on a fee/commission basis or contract basis : Property
management services on a fee/commission basis or contract basis: Building sales on
a fee/commission basis or contract basis: Land sales on a fee/commission basis or
contract basis: Real estate appraisal services on a fee/commission basis or contract
basis.
Declared Service [Para 5(a) of Schedule II]: Renting of immovable property is a
declared service under Schedule II of CGST Act. Further, as per Para 2 of Schedule II,-
(a) any lease, tenancy, easement, license to occupy land is a supply of services;
(b) any lease or letting out of the building including a commercial, industrial or
residential complex for business or commerce, either wholly or partly, is a
supply of services
All kinds of lease of land/building are ’service’: Both (a) and (b) virtually amount to
renting of immovable property [i.e., other than transfer of title]. Hence, such transactions
are deemed ‘service’
1- Renting [Para 2(zz)]: “Renting”, in relation to immovable property, means-
• allowing, permitting or granting.
• access, entry, occupation, use or any such facility,
• wholly or partly.
• in an immovable property,
• with or without the transfer of possession or control o the said immovable
property and
• includes letting, leasing, licensing or other similar arrangements in respect of
immovable property;
2- Exemption_ Residential renting [Entry 12] : Services by way of renting of –

• residential dwelling
• for use as residence
are covered within the exemption and, thus, not chargeable to GST.

‘Residential dwelling’[CBIC]:As per normal trade parlance it is-
• any residential accommodation,
• but does not include hotel, motel, inn, guest house, campsite, lodge, house boat,
or like places meant for temporary stay.
Instances of taxation of renting:
Page66
Case Taxability of renting transaction

Central Goods & Services Tax Act, 2017