Union of India & Anr. Vs Gujarat Chamber of Commerce And Industry & Ors. (Supreme Court of India)
The Supreme Court dismissed the Revenue’s batch of Special Leave Petitions against the Gujarat High Court judgment holding that the assignment, sale and transfer of leasehold rights in GIDC industrial plots along with buildings constructed thereon, by the lessee-assignor to a third-party assignee for a lump-sum consideration, constitutes a transfer of immovable property and is not liable to GST. The dispute arose after the GST Department sought to levy GST at 18% by treating such assignments as a taxable supply of service under Sr. No. 35 of Notification No. 11/2017-Central Tax (Rate). The Gujarat High Court had allowed the writ petitions and quashed the show cause notices and consequential orders, holding that the transaction falls outside the scope of “supply” under Section 7(1)(a) of the CGST Act read with Clause 5(b) of Schedule II and Clause 5 of Schedule III. The Supreme Court noted that it had already dismissed a similar SLP arising from the Bombay High Court, declined the Revenue’s request to clarify the taxability of a standalone transfer of development rights without transfer of the underlying land, kept the larger question of law open, and dismissed the Special Leave Petitions along with pending applications. Read HC Judgment in this case: No GST on Transfer of Leasehold Rights: Gujarat High Court
