Dear Sir/Madam,
I had booked a under consturction flat in Hyderabad in July 2007, in a residential complex (with more than 500 flats). The details are given below.
July2007-April 2010: Paid 70% of total construction cost.
April 2010: Project got Municipality approved 'fit for occupancy' certificate.
April 2010-April2011: Another 25% of total construction cost paid. So far from beginning to now I paid (70%+25%) 95% of total construction cost to the builder.
The last payment balance is 5%.
My builder told me that I need to pay service tax on the payments received by them from us so far. However, what I have understood as per the latest circular is that service tax will be applicable only for payments made from July 1, 2010 and prior to completion of building. In this case construction is completed before July 1, 2010 and hence I am not required to pay service tax. Is that correct?
But the builder is claiming that I need to pay the service tax whatsoever.
I am planning to do the registration soon. Kindly advise ASAP what I need to do in this case. Should I pay the service tax?
Thank you in advance for your guidance.
