We have purchased a flat in X venture. The details are as under:

We booked a flat on December 3, 2024, by paying a token advance of ₹3.6 lakh. The venture got occupancy certificate from GHMC on December 31, 2024. We entered into a sale agreement on January 18, 2025, for ₹1,40,80,710 (sale consideration ₹1,34,10,200 + GST – ₹6,70,510). We have paid a total of ₹1,40,80,710 and the flat was registered on February 12, 2025. Later, I came to know that GST is not applicable for ready-to-move flats.

But the seller says he has paid the GST.

Please clarify whether GST is applicable or not for our flat purchase. If applicable, no problem. If not, what course is left for us to recover the GST amount paid to the seller.

T Balanarayana

This is liable to GST in terms of Section 7 read with clause 5(b) of the Second Schedule of CGST Act, 2017.

As per this provision, even if a part consideration is received before the issuance of an occupancy certificate by the relevant authorities, the said supply of construction services is liable to GST.

In the present case, it has been stated that an advance was paid on December 3, 2024, and an occupancy certificate was received on December 31, 2024.

Accordingly, GST is liable to be paid in such a scenario. Since it is residential apartments, GST is liable to be paid at 5 per cent, which is correctly calculated in this case.

The author is a practising chartered accountant

Send your queries to taxtalk@thehindu.co.in

Published on June 28, 2025

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