Joint venture with land lord

[Guest]

Very specific answer wanted Whether Promoters/Builders works under joint venture with land lord for construction of flats and selling out later are subjected to Services tax taking into consideration the decision of court a) Raheja Construction and b) Megas construction

[Surender Gupta]

Threre are different propositions in different circumstances. However, in general sale of flats are not subject to service tax.

AI Summary

Service tax on sale of flats: generally not leviable where builders sell completed units, subject to factual exceptions. Whether promoters or builders in a joint venture with a landowner attract service tax depends on circumstances, but the operative position is that sale of flats constituting a transfer of immovable property after construction is generally not subject to service tax; specific contractual or factual arrangements may, however, lead to different conclusions.