TaxTMI 
TaxTMI 
Land owner enter an agreement with builder for building apartments. As a consideration, builder agrees to allocate few fully furnished flats to the land owner on free of cost.
please let us know the applicability of service tax.
regards
Saravanan.
Service tax applicability
22 Jan 2016 
7 Replies 
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Service tax applicability: flats allotted to landowner in developer agreement are taxable as works contract service; valuation rules govern.
Service tax applies where a builder allocates furnished flats to a landowner as consideration, characterising the arrangement as a taxable construction/works contract service; the value of the flats is taxable and valuation and point-of-taxation are determined by the Board's valuation guidance which governs in-kind consideration in such agreements. (AI Summary)
Service tax applies where a builder allocates furnished flats to a landowner as consideration, characterising the arrangement as a taxable construction/works contract service; the value of the flats is taxable and valuation and point-of-taxation are determined by the Board's valuation guidance which governs in-kind consideration in such agreements. (AI Summary)