Service tax on real estate

Queries 388 views 2 replies

CA Sunil Kumar Dudeja

Student

135 Points Joined June 2009

Dear Sir

I have an urgent query regarding the Real Estate Business of one my client, he is selling a Housing Society Projects with two type of segment-one is Freehold Property in which he sells a plots of around 80 Sq. Yard and another is Constructed flats of 2 BHK/3 BHK on a margin Basis-For E.g.-Purchase @ 2000/- Sq. Yard.and sells @ 2500/-Sq. Yard.He paid commission to his various associates in selling the same.He made payment to his vendor on Lump Sum & Instalment Basis.He didn't developed/construct the plots.My Question is only that whether he is liable to pay service tax,if yes-then in which service with abatement,cenvat credit etc.If no-then in which section/rule/notification is defined.Please reply me asap. with brief notes or links.I Shall be very grateful to you for this.

Replies (2)

karan jit singh

Consultant

1299 Points Joined November 2010

Wow , so many things in a question ,, Real estate business... Segment ; sells plots of 80 sq yards No levy of service tax as this is a case of sale of immovable property. As a transfer of title of immovable property by way of sale is excluded from definition of service under section 65B (44) . . , Segment : sale of sonstructed flats No levy of service tax as this is a case of sale of immovable property. As a transfer of title of immovable property by way of sale is excluded from definition of service under section 65B (44) . . ,

karan jit singh

Consultant

1299 Points Joined November 2010

This was the treatment of selling party But for agent, The service provided by him is definitely a service as per defined in section 65B (44) and not declared as negative list of service undrr section 66D. Neither any partial or full exemptio under notification 26/2012 & 25/2012 respectively. Therefore, full ST is chargeable under section 66B if providd or agreed to provided in taxable territory.