The value calculated by the owner upon delivery of TDR or market value (calculated by the government during the collection of stamp duty) is calculated if such a TDR agreement is entered into. But here again, the author has another argument that, if the government itself has already clarified in 2017 that the sale of antique jewelry and private used vehicles is not considered a delivery, because they are not intended to promote the activity. So why doesn`t the same principle apply to the exchange of TDR services and works? Does this mean that there will be separate principles that will apply to goods and be separated for services? The author understands controllability in such cases. However, disputes in such cases can still be mitigated by very careful drafting of the JDA agreement, so that this is not unnecessarily interpreted as an encouragement to transactions or deliveries. If the development right transfer agreement is concluded with the lessor, the developer will pay taxes on that day in accordance with RCM. In the case of MAARQ Spaces (P.) Ltd., 2019 (11) TMI 994 – AUTHORITY FOR ADVANCE RULING, KARNATAKA Antragsteller has entered into a joint development agreement with the landowners for the development of residential layout land and the costs of the development are borne by the applicant. Revenues from land sales are shared in a ratio of 75 percent for landowners and 25 percent for applicants. It was found that the activities carried out by the applicant are treated as a service to landowners and that the taxable value of the supply within the meaning of Rule 31 (residual rules with reasonable means compatible with the principles and general provisions of Article 15) corresponds to the total amount received by the applicant. Joint development agreements (“JDAs”) are generally concluded either on the basis of participation in turnover or on the distribution of areas. In the area-sharing agreement, landowners enter into an agreement with the developer under which the landowner grants the developer development rights to build or develop a complex. In return, the contracting authority undertakes to allocate part of the built area in the form of housing. Both parties are free to sell the area under construction on their own to potential buyers. In many parts of the country, there is a practice of having a separate register for land and separate housing for built housing.
Thus, in such cases, an evaluation problem often arises. In the case of IN RE: M/S. KARA PROPERTY VENTURES LLP 2019 (3) TMI 924 – AUTHORITY FOR ADVANCE RULING, TAMILNADUthe Assessee has entered into two separate agreements, one for the sale of a share of unshared land and the other for the construction of a complex service for the buyer, with two separate counterparties being required of the buyer. That is how a question was raised about the tax measure. The AAR decided that the two agreements were coexisting and ongoing simultaneously; Any contract cannot be terminated without the termination of the other, it is a single delivery, which falls entirely under entry 5 (b) of Schedule II of the Central Goods and Services Tax Act, which makes this transaction a “complex construction” service and it is therefore established that the GST can be raised to 2/3 of the total value of the two agreements. In this case, the taxpayer and the landowner have completed a JDA for the development of land into residential land, as well as amenities. The revenue rate between taxpayers and landowners is 25-75%. The development costs were borne by the taxpayer. .
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