In re TCG Urban Infrastructure Holdings Private Limited (GST AAR West Bengal)
West Bengal Authority for Advance Ruling (WBAAR) examined the GST classification and tax rate applicable to TCG Urban Infrastructure Holdings Pvt. Ltd. for supplying fitted assets on hire. The applicant, engaged in real estate development, provides infrastructure support to tenants, including air-conditioning systems, fire sprinklers, DG sets, and electrical installations. Initially, the applicant applied a 28% GST rate based on Notification No. 11/2017 but sought clarity on whether an alternative rate of 18% under SAC 997314 should apply.
WBAAR ruled that such services fall under leasing or rental services and should be taxed at 18% under serial number 17(viii) of the notification. The ruling classified the assets as immovable property, negating the argument for a mixed supply with the highest rate of 28%. The decision aligns with a prior ruling for Sun Knowledge Pvt. Ltd., a tenant of TCG Urban. The applicant, after consulting experts, is reconsidering its approach and exploring alternative interpretations regarding the nature of the charges recovered from tenants.
What would be the proper classification of the services and rate of tax being provided by the applicant by way of supplying fitted assets on hire basis?
