LUNA CHEMICAL INDUSTRIES PRIVATE LTD v. THE UNION OF INDIA & ORS. – Gujarat High Court
High Court, Gujarat
A.S. Supehia, Justice & Pranav Trivedi, Justice
LUNA CHEMICAL INDUSTRIES PRIVATE LTD
v.
THE UNION OF INDIA & ORS.
R/SPECIAL CIVIL APPLICATION No. 617 of 2024 dated 13.03.2026
Law : GST
Act Name : Central Goods & Service Tax Act, 2017
Relevant Section : Section 7, 9, 70 & 74
Decision : In favour of assessee
Levy of GST on assignment of leasehold rights – Petitioner allotted GIDC industrial plot transferred leasehold rights to third party through assignment deed – Department issued summons demanding documents issued SCN under Section 74 treating assignment as supply of service – Court noted as per Gujarat Chamber of Commerce GIDC lease allotment constitutes supply of service under Section 7(1)(a) read with Schedule II clause 5(a) – However assignment of leasehold rights by lessee to assignee constitutes transfer of immovable property excluded under Schedule III clause 5 – Leasehold rights for 99 years equate to absolute alienation akin to sale – Transaction divests assignor of all rights with assignee assuming direct lessee obligations to GIDC – Held: Provisions of Section 7(1)(a), Schedule II clause 5(b) and Schedule III clause 5 render transaction non-taxable under Section 9 CGST Act – SCN and order quashed.
Represented By:
Counsel for the Petitioner: Nisarg Desai with Yash Modi for Gandhi Law Associates
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