<h1>Taxation of construction services: splitting land, material and service values determines VAT and service tax incidence accordingly.</h1> Builders' collaboration agreements create two taxable activities: (A) works contract/service from builder to landowner in exchange for land/development rights, and (B) works contract/service from builder to purchasers who pay before completion. State VAT excludes labour, services and land from taxable turnover by actual or percentage methods or composition schemes; rules prescribe deduction methods and point of taxation tied to transfer or incorporation of goods. Service tax taxes complex construction where payment is received before completion certificate, allowing prescribed abatements or actual valuation under Rule 2A; timing follows invoice/receipt rules.