GST is Applicable on Lease Rent : AAAR upholds AAR Ruling

GST is Applicable on Lease Rent : AAAR upholds AAR Ruling The Appellate Authority for Advance Ruling in Karnataka in matter ofM/s Tathagat Heart Care Centre LLP The AAAR upheld the ruling rendered under provisions of 98(4) the GST Act 2017 by Advance ruling authority vide order KAR ADRG 04/2018 dated 21-03-2018 of GST is leviable on the rent paid /payable for the premises taken on lease Below is the extract of Order: 11. Thus, what emerges from the above is that : a) No GST Is payable on outward healthcare supplies, as these are exempted supplies ; b) "Renting in relation to immovable property" has been defined under the definition clause 2(zz) of the CGST Notification No 12/2017- Central Tax (Rate) dated 28-06-2017 and KGST Notification (12/2017) No FD 48 CSL 2017 Bengaluru dated 29-06-2017 to mean allowing, permitting or granting access, entry, occupation, use or any such facility, wholly or partly, in an Immovable property, with or without the transfer of possession or control of the said immovable property and includes letting, leasing, licensing or other similar arrangements in respect of immovable property. By virtue of these Notifications, services by way of renting of residential building for use of residence only is exempt from levy of GST Vide SI.No .12 of the said Notifications. c) In terms of CGST Notification No 11/2017 - Central Tax (Rate) date 28-06-2017 and KGST Notification (11/2017) No FD 48 CSL 2017 Bengaluru dated 29-06-2017. GST is leviable @ 18% (CGST@9% SGST@ 9%) on the rent paid / payable for premises taken on lease by the Applicant for running the hospital vide SI.No.16 (Real Estate Services) of the said Notifications. 12 As regards the plea that this Authority is required to pass a ruling on para 8(b) and 8 (c) we observe that these issues are outside the realm of our consideration. The scope of the Appellate Authority for Advance Ruling under section 101 of the Act is limited to passing such order, as it thinks fit, confirming or modifying the ruling appealed against or referred to. There was no question raised before the AAR seeking a ruling on the aspect of ITC used in providing exempted supplies and refund of Input Tax credit. This issue has been raised for the first time before us in appeal. We are of the view that, there can be no appeal on issues on which no ruling was sought before the Authority for Advance Ruling under section 97 of the Act and which was not examined by the AAR. As such, the plea of the Appellant on this issue is dismissed, as non-sustainable. 13. In view of the above discussions, we pass the following order:

ORDER

We uphold the Order KAR ADRG 4/2018 dated 21.03.2018 passed by the Advance Ruling Authority and accordingly the Appeal filed by the Appellant Tathagat Heart Care Centre LLP stands dismissed on all counts. Click here to download AAR Order against which Appeal has been filed Click here to download AAAR Order