CA Shraddha Vora (Employee) 30 July 2013

Provision of service- on construction

As on 1.7.2010, the building is 50% complete as is certified by the Architect. A booking is made on 26 June 2013 for a consideration of Rs.1 crore.

Since service tax on construction was levied on or after 1.7.2010, Should service tax be levied on 50% or 100%? the question of debate is that construction has taken place to the extent of 50% before 1.7.2010, therefore same may not be taxable. However, one may take a contrasting view that since booking has been made after 1.7.2010, service has been provided only after applicability of service tax.

Please express your views.

Thank you, in anticipation

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1 Replies

Rama chary Rachakonda (Secunderabad/Telangana state Highcourt practice watsapp no.9989324294 ) 30 July 2013

although paying Service Tax is mandatory, it can be avoided if:

a. The builder has obtained a completion certificate from the issuing authority.

b. The buyer has paid the entire consideration only after the building completion certificate had been obtained by the builder.

Please note that you can even get the completion certificate from an architect or chartered engineer or licensed surveyor. It is not necessary to go to a Government authority to get the completion certificate. You may rely on the notification issued by the Government of India (D.O.F.No.334/03/2010-TRU