please help us with the below case. I am unable to understand it, will this not be a case of amount received before the issue of completion certificate and service tax is leviable thereof.
Question If the person who has entered into a contract with the builder for a flat for which paymentsare to be made in 12 installments depending on the stage of construction and the person transfers his interest in the flat to a buyer after paying 7 installments, would such transfer be an activity chargeable to service tax?
Answer Such transfer does not fall in this declared service entry as the said person is not providing any construction service. In any case transfer of such an interest would be transfer of a benefit to arise out of land which as per the definition of immoveable property given in the General Clauses Act, 1897 is part of immoveable property. Such transfer would therefore be outside the ambit of ‘service’ being a transfer of title in immoveable property.
CAclubindia
