Dear Sir,
I have purchased under construction property in Thane ( Mumbai ). I have done agreement with builder in 22 Nov 2010. Builder has not yet handed over possession. Builder is demanding 1% VAT on Agrrement value and 25% penalty.
Does 25% penalty liable in this case?
Please advice me.
As per Rules and with reference to High Court judgement dated 30th Oct, 2012, Builders have to pay 1% Vat
(1% of Agreement Value) by 31st October, 2012 otherwise additional annual penalty of 15% of Tax will be levied.
Hence the builders can recover this amount from the Buyers, but at the same time he cannot keep Margin in this ( 25% Penalty as in your case ). At the most you will be liable to pay 15% not more than that.
Regards,
RAJESH CHOUDHARY
In case possession of the completed property is already handed over to buyer on payment of full price, is the builder entitled to recover the VAT amount from buyers? What should buyers do if the builder asks for VAT amount from the buyer for property of which possession was handed over more than 1 year ago?
In case possession of the completed property is already handed over to buyer on payment of full price, is the builder entitled to recover the VAT amount from buyers? What should buyers do if the builder asks for VAT amount from the buyer for property of which possession was handed over more than 1 year ago?
CAclubindia
