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Table of Contents
[F. No.354/53/2021 -TRU]
Government of India
Ministry of Finance
(Department of Revenue)
New Delhi, the 2nd June, 2021
Notification No. 02/2021- Integrated Tax (Rate): Seeks to amend notification No. 06/2019- Integrated Tax (Rate) so as to give effect to the recommendations made by GST Council in its 43rd meeting held on 28.05.2021.
[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB- SECTION (i)]
G.S.R (E).- In exercise of the powers conferred by sub-section (1), (3) and subsection (4) of section 5, sub-section (1) of section 6 and clauses (iii), (iv) and (xxv) of section 20 of the IGST Act, 2017 (13 of 2017), read with sub-section (5) of section 15, subsection (1) of Section 16 and section 148 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, and on being satisfied that it is necessary in the public interest so to do,
hereby makes the following further amendments in the notification of the Government of India, in the Ministry of Finance (Department of Revenue) No.08/2017- Integrated Tax (Rate), dated the 28thJune, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 683(E), dated the 28thJune, 2017, namely:-
In the said notification, in the Table, -
- in serial number 3, against items (i), (ia), (ib), (ic) and (id) in column (3) , in the conditions in column (5), in the fourth proviso, in the Explanation, after clause (ii), the following clause shall be inserted, namely-
“(iii) the landowner-promoter shall be eligible to utilize the credit of tax charged to him by the developer- promoter for payment of tax on apartments supplied by the landowner-promoter in such project.” ; - in serial number 25,-
- after item (ia) in column (3) and the entries relating thereto, in columns (3), (4) and (5), the following items and entries shall be inserted, namely –
| (3) | (4) | (5) |
| “(ib) Maintenance, repair or overhaul services in respect of ships and other vessels, their engines and other components or parts. | 5 | -” |
- in item (ii), in column (3), for the word, brackets, figures and letter “ and (ia)”, the brackets, figures, letter and word “,(ia) and (ib)” shall be substituted.
2. This notification shall come into force with effect from the 2nd day of June, 2021.
(Rajeev Ranjan)
Under Secretary to the Government of India
Note: - The principal notification No. 8/2017 - Integrated Tax (Rate), dated the 28thJune, 2017 was published in the Gazette of India, Extraordinary, vide number G.S.R. 683(E), dated the 28th June, 2017 and was last amended by Notification No. 02/2020- Integrated Tax (Rate), the 26th March, 2020 vide number G.S.R. 222(E), dated the 26th March, 2020.
📚 Frequently Asked Questions (FAQs): Notification No. 02/2021 - Integrated Tax (Rate)
Q1: What is Notification No. 02/2021 – Integrated Tax (Rate)?
Answer:
Notification No. 02/2021 – Integrated Tax (Rate), issued on 2nd June 2021, amends Notification No. 08/2017 – IGST (Rate) to implement changes recommended in the 43rd GST Council Meeting held on 28th May 2021.
It introduces two key updates:
Clarification for landowner-promoter ITC utilization in real estate projects.
Inclusion of maintenance, repair, and overhaul (MRO) services for ships and vessels under a 5% GST rate.
👉 For GST advisory, contact a GST Professional.
Q2: What is the change regarding landowner-promoter under this notification?
Answer:
A new clause (iii) was added in the explanation under serial number 3 of the original notification, clarifying that:
“The landowner-promoter shall be eligible to utilize the credit of tax charged to him by the developer-promoter for payment of tax on apartments supplied by the landowner-promoter in such project.”
🏠 This amendment ensures input tax credit (ITC) benefits flow correctly to landowners who sell apartments in joint development agreements (JDA).
Q3: Why was this clarification needed for real estate projects?
Answer:
Before this notification, ambiguity existed regarding whether the landowner-promoter could utilize GST credit from the developer-promoter’s invoices.
The amendment removes this confusion, allowing seamless ITC utilization — ensuring tax neutrality and smoother compliance for both parties.
📋 For compliance and reconciliation help, visit GST Compliance Services.
Q4: What new service was added under Notification No. 02/2021?
Answer:
A new item (ib) was inserted under serial number 25:
“Maintenance, repair or overhaul (MRO) services in respect of ships and other vessels, their engines and other components or parts”
Tax Rate: 5%
🚢 This brings ship and vessel MRO services at par with the aviation MRO sector, promoting “Make in India” for the maritime industry.
Q5: What is the significance of the 5% GST rate on ship MRO services?
Answer:
The reduced GST rate of 5% encourages ship maintenance and repairs to be performed within India rather than abroad, boosting domestic maritime repair industries and employment.
⚓ For marine business setup, check MSME Registration.
Q6: When does this notification come into effect?
Answer:
This amendment is effective from 2nd June 2021, as published in the Gazette of India (G.S.R. ... E). All invoices raised on or after this date must comply with the revised rules.
Q7: How does this connect with the 43rd GST Council Meeting?
Answer:
The 43rd GST Council Meeting (held on 28th May 2021) recommended several reforms, including:
Clarification of ITC for landowner-promoters, and
GST rate reduction on ship MRO services to 5%.
Notification 02/2021 officially implemented these Council recommendations through amendments to Notification 08/2017 – IGST (Rate).
📘 Stay updated with more GST Amendments.
Q8: What does this amendment mean for landowners under JDAs?
Answer:
Landowners in Joint Development Agreements can now:
Claim and use Input Tax Credit (ITC) charged by the developer.
Utilize that credit to pay GST on apartment sales.
Avoid double taxation and cash flow blockages.
🏗 Developers can also plan projects better with Online GST Registration.
Q9: What industries benefit from this notification?
Answer:
✅ Beneficiary sectors include:
Real Estate Developers – clearer ITC rules for landowners.
Shipbuilding & Maritime Repair Firms – reduced GST rate.
Logistics & Ports Industry – lower service costs for vessel maintenance.
🌍 Businesses in these areas can optimize filings via GST Return Filing.
Q10: How can Finodha assist under Notification No. 02/2021?
Answer:
Finodha offers:
Advisory on ITC utilization and real estate GST planning.
Assistance with marine MRO GST compliance.
Return filing & classification review for amended IGST rules.
Support for Private Limited Registration and One Person Company (OPC) Registration.
Download PDF: Notification No. 02/2021 - Integrated Tax (Rate)
More Information: https://taxinformation.cbic.gov.in/
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