SERVICE TAX ON RESIDENTIAL QUARTERS

[NANDKUMAR SAGWEKAR]

DEAR ALL MEMBERS

WHETHER SERVICE TAX IS LIABLE TO PAID ON FOLLOWING ACTIVITIES .

1. SERVICE PROVIDER UNDER TAKE CONSTRUCTION OF RESIDENTIAL QUARTERS / FLATS FOR AN

    EDUCATION  TRUST WHO PROPOSE TO IMPART EDUCTION TO STUDENETS OF DEGREE COLLEGE. THE

    SAID RESIDENTIAL ACCOMODATION WILL BE USED AS A RESIDENCE BY THE TEACHERS , STUDENTS

   AND OTHER STAFF OF THE EDUCATION TRUST. THESE FLAT WILL NOT BE FOR SELLING PURPOSE.

   THE NO. OF UNITS ARE 82 IN FOUR BUILDING HAVING COMMON AREA.

 

     THANKS

     A M SHEMBEKAR

    CELL 9421187122

AI Summary

Residential complex exclusion may exempt trust owned staff and student housing from service tax when trust provides land and materials.
Whether service tax applies depends on arrangement and land ownership: where the educational trust owns the land and supplies materials while contracting labour only, the activity falls under the residential complex exclusion and is not taxable; where construction is on third party land or structured as a works contract, tripartite agreement, sale or construction linked payment, it is taxable. CBEC circulars provide further guidance on classification and exclusions.