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Sales Tax and Service Tax levied on Builders & developers

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Manoj Asher

Service

20 Points Posted on 20 June 2011

Sir

I request you to please guide me which latest circular to be followed for Builders & Developers

in the matter of implication of Sales Tax & Service Tax to be levied on purchaser of Flat

what will be the steps to be followed in the said matter?

1st can we apply for Sales Tax And Service Tax Registration no?

If so then from which date we are liable to levy the above mentioned tax ?

Please clarify this matter urgently.

Thanks

Manoj Asher

I humbly request CA Club india that do not treat this querry as abuse, but give me the best judgement from your side.

Replies (1)

Pawan Kr. Tomar

20 Points Posted on 20 June 2011

Circular no. 96/07/2007 ST dated 27.08.07.

1. Where any builder/promotor/developer or any other person build a residential complex (,ore than 12 units) by engaging other builder/developer/contractor, ST will be applicable

2. Where no other person is engaged in development/construction then no ST will be applicable (absence of service provider and service receiver relationship)

Circular no. 108/02/2009 ST dated 29.01.2009

Issue: Where developer/builder/promoter enters into an agreement with the ultimate owner for selling a dwelling unit in a resindential comples at any stage of construction (or even prior to that) and who makes construction linked paymet- Whether ST applicable.

Clarification: ST would not be applicable (existence of "self service" and some due to exemption)

For more clarity please read the circulars.