TaxTMI 
TaxTMI 
Please advise me whether service tax is applicable for one of my client who is making constructing buildings in the form of duplex for residential accomadation. He sold the portion of land individually to all the customers. Now he has made agreement for construction of building one-to-one basis individually.
My question is whthere service tax is chargable if so under which category?
service tax on construction building
26 Nov 2011 
4 Replies 
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Works contract service: construction of individual duplexes may attract service tax where VAT applies, with limited cenvat credit.
Characterisation as Works Contract Service depends on State VAT applicability; if so, the construction service is taxable as works contract with taxable value including materials supplied free by the client. Cenvat credit is available for capital goods and input services but not for input materials under the composition scheme. The activity may fall outside Commercial Construction or Residential Complex classifications when contracts are individual and produce single dwellings for personal use. (AI Summary)
Characterisation as Works Contract Service depends on State VAT applicability; if so, the construction service is taxable as works contract with taxable value including materials supplied free by the client. Cenvat credit is available for capital goods and input services but not for input materials under the composition scheme. The activity may fall outside Commercial Construction or Residential Complex classifications when contracts are individual and produce single dwellings for personal use. (AI Summary)