On the transfer of GIDC plots, the industrial units based in Gujarat’s GIDC estates are combating the GST levy.
In some cases, MSMEs would owe a higher GST liability than their profits as they transferred the plots to the other companies in a short span since the business was not profitable, as per the Chartered accountants. Before the High Court, some industry associations would plan to file the petition as the GST department would levy the GST on the GIDC land transfer however not permitting the input tax credit (ITC) against the same.
Plots of GIDC are leasehold land and must not be deemed as goods or services as per the GST, the Gujarat Chamber of Commerce and Industry (GCCI) written to Gujarat chief minister Bhupendra Patel and Union finance minister Nirmala Sitharaman.
The details of the GIDC plot transfers from GIDC would have been collected by the GST department and various other companies would receive the notices of GST towards the tax levy on the acknowledgement obtained for the assignment of the leasehold land.
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The notices have been provided since 2017-18 and there are some cases in which the buyers and sellers would not be in contact or conflicts that exist between them for the retrospective GST obligations with penalties and interest. Notices for the tax have been received by the MSME on the acknowledgement obtained for the assignment of the leasehold land that is not proper, Ajit Shah, chairman of the GIDC committee of GCCI, stated.
Jashu Chaudhari, president of the Ankleshwar Industries Association mentioned that levying the GST without permitting the ITC on lease is not relevant. No GST paying for the lease transfers would have been advised by us. It is ensured by the state government that they shall carry the same problem before the GST council, and we shall proceed to court if the same would not get solved.
Various MSME units who had transferred their GIDC plots to the other entities would have obtained the GST notices.
