Service tax leived by developer

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Srinivas (Querist)
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29 May 2015 Can a builder who is developing a commercial property and selling units to retail investors charge service tax on the cost of land as well as construction cost ?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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29 May 2015
Notification no 26/2012-ST issued and made effective w.e.f. 01.07.12 which provides a kind of partial exemption from payment of service Tax on some services.
Construction of complex etc. Is one such service listed at sl. no. 12 in aforesaid notification. Service can claim abatement and pay service tax on a lesser value as under:
Taxable 25%
a) For a residential unit satisfying both the following condition;
i) The carpet area of the unit is less than 2000 sq. Ft.
ii) The amount charged for the unit is less than Rs. 1 Crore.
Taxable 30%
b) For other than (a) above
Conditions to be fulfilled to claim abatement:
The following both the conditions are required to be fulfilled to claim abatement:
i) The CENVAT credit on inputs used for providing taxable service has not been taken under
the provisions of CENVAT Credit Rules, 2004
ii) The value of land is included in the amount charged from service receiver

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