Upgrad LLM

vat registration for builder


Dear All,

Pls lite on this topic:-

We are in construction business in UP and making a multi storied apartment here. We  are doing this business by Pvt. Ltd Firm and having  service tax registration .  some days ago some peoples from development authority  comes on construction site and ask for sale  tax registration which we do not have yet. However we do not sale a single unit yet but get some  Partial Payment (advance) from clients

So pls suggest us if we get registration now , is there any penalty lies on us.

Thanx

 
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Proprietor

Dear Querist,

As is understood from your posting , you are  only rendering construction service to the parties/ flat owners who release payment on phased manner .You have taken a Service Tax Registration in the name of your Pvt. Ltd. Company to comply with your statutory obligation arising out of such an activity. Since you are not selling readymade houses to prospective customers , your activity does fall under the purview of " Sale of Goods Act"/ or State Value added Tax Act. However , if you are undertaking the construction work from land owner(s) by way of a Contract, the activity would fall under the Value Added Tax Act of your state under which you are required to take registration as a "Works Contractor" if your turnover crosses the threshhold limit for seeking regn. under the Act.

 
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