Entire value of the flat is liable to service tax, if any amount is received prior to getting of completion cerrtificate.

Entire consideration shall be received before completion for non-taxability.

Hence, in this case, service tax liability shall be imposed on the entire consideration.

You may refer Sec66E(b) for meaning and you can claim abatement of 25% as per Notification No.26/2012-St dated 20-06-2012, if the value includes land value, else go for 40% valuation as per Rule 2A of Service Tax (Determination of Value) Rules, 2006 under works contract scheme.

Hope this is suffice.

THANK YOU NAIR SIR & VIKAS SIR...  

One has tobe careful of the possible classification disputes.

If the service is under construction services then on 25%  of amount [ inlcuding the value of land]  recived before completion there isa liability.

In case the same is a works contract then on actual value of services involved . [ If one is under the regular scheme under VAT and say discharges the VAT on 72% or 65% of the value, then ST can be paid on the balance as per Valuation rules. Where the figures are not available then pay ST on 40%. In this category the ST is payable only on the construction contract and not on the land value.

Respected Experts

Very informative discussion on a complex issue. I am keeping this bookmarked.

Regards,