The Karnataka Authority of Advance Ruling ( AAR ) ruled that the transaction value is the taxable value of supply unless cancelled and revealed beneath section 15 Goods and services tax act. The petitioner M/s Pankaj Enterprises is an individual and has no enrolment beneath GST, however, he poses to execute the business as a service provider in the construction and the sale of the commercial immovable properties.
The petitioner seeks the clarification with respect to the determination of the taxable value of the commercial immovable property towards the intention of the GST liability that is if the sale consideration prescribed in the sale deed amid the builder and the proposed buyer must be acknowledged as a taxable value or transaction value of the mentioned immovable property for the guidance value set via state government council towards the enrollment of the mentioned property.
Authority sees that section 15 of GST Act 2017 concerned with “value of taxable supply” and that is reproduced below:
- Value of the taxable supply:
- The value of the supply of goods or service or both will be the transaction where the price is paid actually or subjected to pay for the mentioned supply of goods or services or both in which the supplier and the recipient of the supply are not concerned and the price is the exclusive consideration for the supply.
- The supplied value will comprise of:
- Any taxes duties, cesses, fees, and the charges imposed beneath any law for that the imposed time excluding this act, the state goods, and services tax act, the Union territory goods, and services tax act, and the goods and services tax compensation to states act if the supplier levied separately.
- Any amount that the supplier is responsible to pay concerned to that supply but the same is been incurred by the recipient of the supply and does not come at the price actually furnished or subjected to pay towards the goods or services or both.
- Incidental expenses, along with commission and packing, supplier charged to the recipient of the supply and any amount imposed for anything executed by the supplier for the goods or services supply or both during the time of, or prior to the delivery of goods or services supply.
- Interest or late fee or penalty for late GST payment of any consideration for any supply.
- Subsidies directly connected to the price except subsidies supplied by the Central Government and State Governments.
The Coram of Dr Sri M.P. Ravi Prasad, Member (State Tax) and Sri. T. Kiran Reddy Member (Central Tax) ruled that with section 15 it is clear that the GST act mentioned treating the transaction value as the supply value unless that is eliminated and the value revealed under section 15 of the GST act.
It would not be mentioned to recognize the guidance value mentioned beneath the additional legislation to be deemed to be the supply value unless the transaction value itself is disputed and discovered not acceptable under Section 15 of the GST Act. In the latter case, the determination of the value of these supplies would be made as per the provisions of 15 of the GST Act.
