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Taxability of work contract

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Avinash (Querist)
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07 May 2012 suppose a builder had registered and transferred ownership of property (incomplete) to third party. Builder have to pay service tax the amount of registration of property.

Than If he entered with him as a contractor for construction and furnishing of his residential building (i.e. to complete the incomplete part of house)

Whether he has liable to pay service tax as a service provider for construction of complex even if not fall under the definition of residential complex.

Please suggests also about the liability of VAT under the CG Vat Act.

Arun Gulati

Arun Gulati (Expert)
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08 May 2012 Once, the Builder has transferred the property to third party then third party will become the owner of house. Therefore, now third party if getting work completed through contractor, which will used by the said third party for his personal use. Third party is not liable to pay service tax and accordingly, Builder is not liable to collect the service tax as service provider.

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