06 July 2012
The Answer for your query is given in the Circular No. 151 /2 /2012-ST (F.No.332/13 /2011-TRU)dated 10th February, 2012. In nutshell the answers are: 1) No, if A is not providing any service as such. If the amount is received against transfer of development rights it may be termed as a declared service within the meaning of Clause (a)or(e) of section 66E of the finance Act 2004 which read as under "(a)allowing, permitting or granting access, entry, occupation, usageor any such facility, wholly or partly, in an immovable property, with or without the transfer of possession or control of the said immovable property and includes letting, leasing, licensing or other similar arrangements in respect of immovable property" "(e) agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act; 2)Yes, A is receiving construction service in consideration for transfer of development rights. The method of valuation is described in the above notification. 3) No, it is an outright sale.
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