- Bombay High Court (Nagpur Bench) ruled that assignment of long-term industrial leasehold rights is not taxable as a ‘supply’ under Section 7 of the CGST Act.
- The Court held such assignments are transfers of benefits arising out of immovable property, not leases or sub-leases, and fall outside the scope of “supply.”
- Schedule II cannot independently expand the charging provision; the essential requirement of being “in the course or furtherance of business” was not met in these one-time assignments.
- The Court rejected classification under “other miscellaneous services” and followed the Gujarat HC’s binding precedent.
- The ruling clarifies that assignment of leasehold rights by lessees is not subject to GST, distinguishing it from GST on lease premium charged by development corporations.
Source: elplaw.in
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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