Tax on sale of immovable property

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

27 December 2014 I have purchased a flat whoes agreement date was 27.01.10 & agreement value was 4.5Cr. before registering I have paid 3.5 Cr & balance 1 Cr paid on 13.08.13. O.C. for the flat is recd on 18.05.2013. At time of purchase & payment no VAT & Service Tax were Paid. Now Builder is asking to pay VAT & Service Tax.

As service Tax on Immovable property came into existence on 01.06.10 & VAT on the same was amended on 01.04.10.

Is Service Tax & VAT payable on above? If yes then on which amount and if interest is payable then from which date interest will be applicable?

CA Kumar Mukesh

CA Kumar Mukesh (Expert)
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28 December 2014 Yes additional amount demanded by the builder is correct.

However, if the agreement contains that you have to pay only 4.5 cr, in that case it means that Builder was initially agree to bear the Taxes i.e. consideration also include TAXES. Then it is not correct. You directly approach to Consumer Department.

This transaction comes under the provision of Service tax. for vat you need to refer Respective State VAT law

As Buyer, you don't need to pay either interest on Service Tax or VAT. it is defaulter if builder not you

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