Liability of service tax on advance taken from public

This query is : Resolved

pramod (Querist)
Follow

30 April 2013 my client has business of deposit taken from public.

on maturity say after 6 years following option is being given:

1) Either ask for refund with interest from company.

2) Or purchase plot or flat/house on specific price.

whether liability of service tax on advance taken will arise or not???

CA Vikas Acharya

CA Vikas Acharya (Expert)
Follow

30 April 2013 by cbec:
6.2.6 If the builder instead of receiving consideration for the sale of an apartment
receives a fixed deposit, which it converts after the completion of the building into
sales consideration, will it amount to receiving any amount before the completion of
service.
This may be a colorable device wherein the consideration for provision of construction service
is disguised as fixed deposit, which is unlikely to be returned. In any case the interest earned
by the builder on such fixed deposits will be a significant amount received prior to the
completion of the immovable property. As will form part of the consideration.
interest in such cases would be considered as part of the gross amount charged for the
provision of service and the service of construction will be taxable.

hope clear from above point

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Join the CA Students WhatsApp Community for ICAI Updates, Trending Courses & Notes!

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

JACOB ABRAHAM KURIALANICKAL

Jitin Aditya Kapur

sachidanandam

Rajesh

Amit Singh

Subscribe Now

Liability of service tax on advance taken from public

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

Senior Executive

Manager- Finance and Compliance

GST CONSULTANT

GST CONSULTANCY

Accountant

CA Final

Article Assistant

Associate CA