Exemption on construction of holiday homes

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This query is : Resolved

CA JAIMIN TRIVEDI (Querist)

25 March 2009 One of my client has got construction work from Sbi for holiday homes. These holiday homes are exclusively for the benefit of the employees and would be given to them at a very nominal rate, i.e. not for profit basis. Will service tax liability arise or will there be exemption as it is not a commercial construction service.

Rajesh Kumar

Rajesh Kumar (Expert)

25 March 2009 ST is Payable. It is a commercial construction as it is for commercial use by SBI in their business.

CA JAIMIN TRIVEDI

CA JAIMIN TRIVEDI (Querist)

01 April 2009 Under Civil Construction category, there is an exemption if the construction is not be used for commerce or industry. Can we take exemption on the grounds that "Holiday home" of Sbi (5 bungalows) will be ised only by the staff for free.

Madhukar N Hiregange

Madhukar N Hiregange (Expert)

03 April 2009 I agree with Mr. Rajesh that it appears to be used for commerce or industry.
The only possible exclusion is if the same can be said tobe residential. What sort of plan sanction is there?

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