A developer enters into land pooling agreement with the owner of the land to develop the plots for residential purpose and to sell them to the purchasers.
In consideration of the Land, provided to the developers, the owners will be given 60 % share of the developed plots. Developer will bear entire cost for developing the plots.
As per my view, there is no construction activity, there seems no service tax chargeable by the developer.
Is there any other service tax issue either to land owners or Developers ?
Looking forward for early advice.
Regards.
Developer Questions Service Tax on Land Pooling Agreement; Analysis Needed for Possible Business Support or Work Contract Service. A developer entered into a land pooling agreement with a landowner to develop residential plots, with the owner receiving 60% of the developed plots. The developer questioned whether service tax applies, given no construction activity is involved. One respondent noted that, under current regulations, it might not be taxable, but future changes could affect this. Another respondent suggested that while it doesn't appear to fall under construction services, a detailed analysis of the agreement is necessary to determine if it falls under other taxable services like Business Support Service or Work Contract Service. (AI Summary)
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