Liability of VAT(Value Added Tax) and the ST(Service Tax)
Subject – Liability of VAT(Value Added Tax) and the ST(Service Tax) on Purchase of Residential Apartment(FLAT in Bangalore – Karnataka)
Respected Sir,
Me and my wife (XXXX) purchased a FLAT C# XXX on 1st Floor having SBA of 1650 Sq.ft in “XXXX Estate” constructed by builder “XXXX” in Bangalore went into “Agreement To Sell” in Jan 2010 with Possession Date of Dec 2010, Bangalore – XXXX. Note - We had only “Agreement To Sell/Sale Agreement” done and did not had any construction agreement at that time.
Total Apartment Floor to be constructed in the Project are – 10 Floors.
My Flat is on – 1st Floor, C Block, C # XXX
At the time of my Booking – 5 Floors were already constructed (Electrical Wiring/Painting etc were done…I mean it was almost finished when we booked the Flat in Jan 2010, But builder took more time to construct remaining floors due to some issues and I am Not Sure if they have taken the Occupancy Letter from BDA.
(Quick question here is does this property becomes “immoveable” , if so I am not liable to pay VAT/ST right?please clarify)
Agreement Page 8i Says –
“If any further tax is liable to be PAID in respect of anything done or deemed to be done under the agreement , in respect of “Schedule A” property through any prevailing or future statue/law, and should any authority raise any demand for any such payment, the PURCHASER hereby agrees, promises and assures to make such payments.”
Sale Agreement was done on 21st Jan, 2010 with
Possession Date as Dec, 2010.
Current Situation – Not letting me know the Possession Date despite many requests.
My sale agreement says to pay 51,11,500/- (Total as per Cost Sheet)
49,11,500/- – is towards (Basic Price+1 Covered Parking + BWSSB and KEB + Club Membership)
2,00,000/- – is towards(Registration + Stamp duty)
Breakup of 49,11,500 is:
24,36,500/- – is towards component of undivided interests of Land AND
24,75,000/- – is towards Apartment and Other Facilities.
All disbursement details done by us through SBI Bank before JULY 2010 are given Below:
2-Jan-2010- 2,00,000/- Cheque was given.
17-Jan-2010- 3,00,000/- Cheque was given,
12-Mar-2010- 22,00,000/- Disbursed by XXX Bank
31-July-2010- 75,924/- Disbursed by XXX Bank
31-July-2010- 18,90,000/- Disbursed by XXX Bank
TOTAL Amount Paid to the Builder till Date - Rs 46,65,924/-
Note - , For the above PAID amount they Provided us all the INVOICES which didn’t had any TIN/VAT Number( Has been enclosed herewith)…
I have already disbursed 46,65,924/- before JULY 2010 and now when I ask them for Registration of FLAT the builder is asking me to pay 4% VAT on 49,11,500 and 2.5% Service Tax on 49,11,500/- (This amount and percentage is NOT being mentioned in my sale agreement) ,
i.e 6.5% of 49,11,500 comes around Rs 3,19,248/- according to builder.
Also Builder also charges me 2,19000/- as late payment – Disbursement was delayed by bank to builder as there was no progress – Builder says he can waive this off if I give him a letter saying I was having financial problem – please advice
Builder asking me to pay VAT and ST amount as -
VAT and ST Amount of Rupees of 3,19,248 i.e 6.5% of Rs 49,11,500/-
I would Like to know few things –
1. Referring to Page 13 of my sale agreement , its an “Immovable” property and according to the supreme court decision under section (Raheja Development Decisions) I am NOT liable to pay any VAT and ST – is this true? please clarify this as my FLAT was already ready when we did our bookings(Till 5th Floor was already constructed, My Flat is on 1st Floor).
2. Please suggest If I am Liable to Pay VAT and ST.
3. Builder also charges me 2,19000/- as late payment – Disbursement was delayed by bank to builder as there was no progress – Builder says he can waive this off if I give him a letter saying I was having financial problem – please advice.
4. If I am Liable to pay VAT/ST under any section,Then let me know the TAX calculation based on
a. Composition Tax – Under Section – 15 KVAT – I have verified with TAX office the Builder is in this category.
b. Regular VAT method @ 12.5% – Based on the builder category, Still I need input on this.
5. What should be the “Registration and Stamp Duty” amount to be paid by me, Please let me know the calculation.
6. Any other Access amount which I/we may need to pay the govt. please providing the detail calculation.
7. Also let me know if they have got Occupancy Certificate from BDA, Else please guide me whom to approach for this.
Thanks
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