Service tax
NAMDEO CHAUDHARI
(Querist) 24 December 2013
This query is : Resolved
Date: 24th December ,2013.
Dear sir,
I purchased a house property having built up area 875 sq.feet in lonavala . I entered in to an agreement for sale on 8th August 2012 .and conveyance deed was made on 12 th sept.2012.The builder produced the occupancy certificate dated 06 th june , 2012 which is issued by municipal corporation. The builder told to me that it is completion certificate.
MY question is relating to service tax.
1.Whether I am liable to pay the service tax if the transaction is made after completion of construction ?
2.Whether the purchaser is liable to pay the service tax if the purchase price is less than Rs.20 lakh.
3.Genrally the document is always similar to the other purchaser and if it is mentioned that I agree to pay the government dues or taxes if there will be change in the act. So what are the changes in the provisions of the act which affects the purchaser?
4. I got message from builder through society president to pay the service tax.Whether it is legal to ask for service tax when the construction is completed before the sale deed?
Kindly guide me which will helpful to us and all.
Thanking You,
Yours Faithfully.
Mr.N.B.Chaudhari.
R.K Nanda
(Expert) 25 December 2013
consult tax lawyer.
V R SHROFF
(Expert) 25 December 2013
ur CA, tax Consultant will do needful
T. Kalaiselvan, Advocate
(Expert) 25 December 2013
It is always better to contact a local tax consultant on such issues who will be able to explain in detail as per the prevailing circumstances.
krishna mohan
(Expert) 26 December 2013
Service Tax is for the services rendered and in your case the property is constructed even before the sale agreement is entered. In civil projects about 40% are taken as services element and ST applied. You may ask for copy of GO issued by tax authorities to ascertain right amount. Also check with your co owners and based on these documents consult practicing lawyer or CA on Service Tax matters to guide you correctly.
Vineet
(Expert) 27 December 2013
No, since you have purchased the residential house after its completion certified by OC issued by Local Authorities, you are NOT required to pay any service tax.
sindhu Mangat
(Expert) 28 December 2013
No service tax is required to be paid when house is sold after completion of construction.
No exemption when purchase price is less than 20 lakhs.
When house property is sold after completion of construction , it becomes a transaction in immovable property which would be subject to stamp duty. No service tax would apply and hence the similarity in agreement with other purchaser would have no impact.
When the purchase is of completely constructed unit and the fact of completion is proved by completion certificate, there is no need to pay service tax.
