Service Tax On Building Construction
Devi Prasad Ruia
(Querist) 28 December 2008
This query is : Resolved
Facts:The Company (C) has entered into a notarized Agreement in Deember 2006 landlord (L) for construction of a building on his land in 70 : 40 ratio. The Broad terms are as follows:
1. Ground floor as commercial and Area of 5 existing shops will be deducted from landlords share on ground floor.
2. 1st floors to 3h floor as residential flats (more than 12 units)
3. The construction of the building is being done by company by engaging daily construction workers
4. The Company will buy 1000 sq ft from Landlord @ Rs. 400- per sq. ft. and has already paid Rs. 4lacs in advance to the landlord .
5. Landlord has executed Registered power of attorney in favour of one of the Director of the Company for execution of sale deed in favour of Purchaser’s of Company’s alocation
6. The total Super structure is complete
7. So far Company has not entered into any agreement for sale and intends to use booking form for booking of flat and after full payment to execute final Sale deed in favour of would be purchaser.
Queries
LANDLORD’S Allocation
1. Whether any Service tax is payable against the landlord allocation
2. under which section
3. Rate of ST
4. Quantum of ST
5. Date of Payment of Such ST
DEVELOPER’S Allocation
1. Whether any Service tax is payable against the Company’s allocation & Purchase of 1000 sq ft. by Company from Landlords Allocation
2. under which section
3. Rate of ST
4. Quantum of ST
5. Date of Payment of Such ST
Rajesh Kumar
(Expert) 06 January 2009
Too much facts to be answered here effectively.
Landlord and developer is not providing any service to anybody, so no service tax. The construction company is providing service of building of residential premises, and hence they need to pay service tax.
