In re R Nilakantan Iyer (GST AAR Karnataka)
In a recent decision, the Authority for Advance Ruling (AAR) in Karnataka rejected an application filed by an individual seeking clarity on the Goods and Services Tax (GST) implications of works contract services received during the purchase of a flat. The applicant, Sri R Nilakantan Iyer of Bengaluru, who is not a registered person under the GST Act, had approached the Authority to determine the value on which tax is payable and the applicable GST rate on the works contract services provided by M/s Shriprop Projects Limited, a company involved in the real estate project from whom the flat was purchased.
The case, formally documented as In re R Nilakantan Iyer, centered on a fundamental aspect of the advance ruling mechanism under the GST law – specifically, who is eligible to seek such a ruling. Sri Iyer had duly filed his application in the prescribed form GST ARA-01, paying the required fee of Rs. 5,000 each under the Central GST (CGST) Act, 2017, and the Karnataka GST (KGST) Act, 2017, as stipulated by Section 97 of both Acts read with Rule 104 of their respective Rules.
During the personal hearing conducted via video conference on April 8, 2025, Sri Nilakantan Iyer presented his case, reiterating the details provided in his application. He confirmed that he had purchased a flat from M/s Shriprop Projects Limited and was the recipient of the works contract services involved in the construction or completion of the flat. His core questions revolved around understanding his tax liability, if any, as a recipient in this transaction, concerning the valuation and the rate of GST applicable to these works contract services.
