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CCP 02.07.23.00 Circular No. 177/09/2022 GST dated 03.08.2022
Dhruv Developers sold a plot of land in Greater Noida after levelling, laying down of drainage lines,

water lines and electricity lines. Determine whether GST is payable or not. [CA Final RTP May 23]
Answer:-
Ü GST is not payable by Dhruv Developers on sale of plot of land.
Ü As per Para 5 of Schedule III of CGST Act, 2017, 'sale of land' is neither a supply of goods nor a supply of

services. Hence, the sale of land does not attract GST.
Ü Land may be sold either as it is or after some development such as levelling, laying down of drainage lines,
water lines, electricity lines, etc.
Ü It is clarified by CBIC that sale of such developed land is also sale of land and is covered by Para 5 of

Schedule III and accordingly does not attract GST.

CCP 02.07.24.00
Sarvanna & Sons wishes to start supplying alcoholic liquor in the State of Tamil Nadu. Therefore, it

applies for licence to the Tamil Nadu Government for selling liquor for which the State Government has
charged specified fee from it. Examine whether the grant of alcoholic liquor licence by the Tamil Nadu
Government to Sarvanna & Sons qualifies as supply. [Study Mat]
Answer:-

Ü Services of granting of alcoholic liquor license by the State Governments have been notified u/s
7(2)(b) of CGST Act which shall be neither treated as a supply of goods nor as a supply of service.
Ü This licence is granted against consideration i.e. licence fee or application fee or or any other fee.
Ü This special benefit is given only for granting of licence to sell liquor as notified above and not for any other
licences or privileges i.e. other licences or privileges given by government are treated as supply & liable to

GST.
Ü Thus, in the given case, the grant of alcoholic liquor license by the Tamil Nadu Government to Sarvanna &
Sons is neither a supply of goods nor a supply of service.

08. Section 7(1A) & 7(3) read with Schedule II:- Activities to be treated as supply of goods
or supply of services (Classification as 'supply of goods' or 'supply of services')
CCP 02.08.25.00

Transfer of title and/or possession is necessary for a transaction to constitute supply of goods.
Examine. [Study Mat]
Answer :-
Ü Section 7(1)(a) of CGST Act, 2017 states that supply include sale, transfer, barter, exchange, lease,

license, rental or disposal for a consideration in the course or furtherance of business.
Ü Once, a transaction is treated as supply, it is classified of goods or services u/s 7(1A) read with schedule II.
Ü As per Para 1 of schedule II, activities are classified as follows:-
a) If both title and possession are transferred in a transaction, it shall be treated as supply of goods.
b) If title is not transferred but possession is given in a transaction, it shall be treated as supply of service.

c) If possession is transferred immediately but title is transferred at a future date in a transaction like sale
on approval basis or hire purchase arrangement, it shall be treated as supply of goods.
Ü Thus, transfer in title irrespective of the transfer of possession is necessary to constitute supply of goods.

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