Service tax on Property

[munaj inamdar]

Sir,

I had booked my flat in Nov. 2009, and paid the instalments as demanded by builder.

But at the time of last instalment on June 2011, he demanded service tax & Vat on agreement cost to get the possession.

So my query is whether ST & VAT payable, if yes then on what amount coz during booking of flat no ST & VAT applicable at that time.

He had not yet get the completion certifiacte.

Any way to escape that taxation.

Thanking U

Munaj Inamdar

AI Summary

Service tax on builder payments applies to instalments paid after the implementation date; pre-implementation payments remain outside liability.
Service tax applies to builders from 01.07.2010; instalments paid before that date are not taxable while instalments paid after that date are liable. Builders apply a 75% abatement reducing the effective service tax burden (practitioner-cited effective rates noted). Taxable value discussions include whether registration, stamp duty and VAT components form part of the agreement value for calculating the tax.