service tax

Do we have to pay service tax on purchase of flat diretly from builder

This will be first purchase

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4 Replies

PJANARDHANA REDDY (ADVOCATE & DIRECTOR) 02 March 2010

I have purchased a ready to occupy flat in hyderabad.After registration of property, owner asked me to pay it.?

Of total flats, ther is 50 - 50 share of developer and owner.I have purchased flat from the share of owner and not from developer.stil i have to pay service tax and if how much? Is it legal on which ground.To whom I have to pay.give me contact details of person- consultant in this field.
thanks bye

1 year ago

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Veers த‌மி‌ழ்

Best Answer - Chosen by Voters

when it is joint venture all the construction expenses, statutory taxes with respect to construction like planning permission fees, building fees, water & sewerage connection fees, electricity connection charges etc., are to be paid by builder in all & the ready to occupy condition flats 50% share of the owner need to be delivered by the builder.

hence in my opinion the builder claiming any money from the purchaser of owners share is no correct.

discuss across the table and solve.

sreenu (ast manger) 03 March 2010

if they charge some kind of development charges then need to pay service tax otherwise not

Vineet (Director) 03 March 2010

As of now there is no service tax payable for purchase of flat from developer. However as per budget proposals which are to be notified at a later date, the payments received by Builder before the completion certificate of building and amounts charged for locational advantage, EDC/IDC etc shall be liable to be charged service tax which developers are likely to pass on to the customers.

Advocate Suresh Kumar T V (Advocate & Indirect Tax Consultant) 08 March 2010

This include so many things. if builder purchased the land by way of sale deed from the land owner and then construct building, after completion of the building he transfered to you by way of sale deed for both land (undivided portion of land) and building, then such a case you need not pay service tax. (or ) if builder transfer undivided portion of land alone to you by way of sale deed and then entered into construction agreement, in this case you liable to pay service tax.