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Mr. Majumdar (Service)     17 June 2013

Service tax on resale of property

Dear friends,

I purchased a flat from a builder through execution of Deed of Conveyance in 2009. Bank loan was availed of by me. The builder made declaration in the Deed that the construction of flat was completed in accordance with the plan sanctioned by the Municipality. He has not paid Service Tax to the Govt. for the flat. Neither has he applied for Occupancy Certificate. However, I now wish to resale the flat. Whether it will attract Service Tax ! What may be the other legal complications?

Kindly share your expertise.

With regards.


 5 Replies

Mr. Majumdar (Service)     20 June 2013

Dear friends,

Kindly make your valuable comments on the foregoing service tax related issue.


With regards.


service tax is payable by builder if he sells the property but in my opinion service tax is not payable by you if you re sale it.

1 Like

Mr. Majumdar (Service)     22 June 2013

Many thanks to Srivastava saab for his valuable opinion. Now, my another query- whether pvt. banks give loan for purchase of resale flats without Occupancy Certificate!

Vineet (Director)     24 June 2013

Service tax is laibility to be discharged be developer on sale of under construction property. For Service Tax purposes, even an architect certificate is sufficient to prove that construction has been completed to escape rigours of service tax. However, in any case resaler of flat is not required to pay service tax.


Now, other question Majumdar Sahib, depends upon guts of the manager of bank. However, after recent spate of decisions against properties without OC, specially Campa Cola Coumpound, Worli case, the banks have become very cautious.

1 Like

Mr. Majumdar (Service)     24 June 2013

Thank you very much Vineet saab for your valuable comments.

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