Service tax rates on immovable property

dilip ranadive (consultant) (48 Points)

30 September 2013  

Hello Everyone,

          I have a quire regarding payment rate of service tax on immovable property. I have booked  a flat in Mumbai with reputed builder. Paid the agreement amount of 20 lakh in December 2011 of which 10 lakh written in agreement as earnest money and other 10 lakh distributed as installment on work progress. Six (6) lakh on basement foundation and 4 lakh on Plinth. Now builder is demanding to pay service tax with rate as follows, 2.575% on 16 lakh and 3.09% on 4 lakh because the demand for installment  of plinth payment  is raised in April 2013. Do I have to pay the tax for 4 lakh as per new rate of 3.09% though I have done payment in 2011? Nothing is mentioned in the agreement about  interest to be paid by builder for delay in work or unused amount lying with him.