Press Information Bureau

Government of India

Ministry of Finance

26-October-2015 15:45 IST

In order to resolve a long standing issue relating to levy of Service Tax on sale of flats/dwellings etc. after issue of occupancy certificate but before issue of completion certificate in areas under the jurisdiction of Municipal Corporation of Greater Mumbai i.e. Brihanmumbai Municipal Corporation (BMC), it has been conveyed to the Service Tax Authorities in Mumbai on Friday, 23rd October, 2015 that sale of flats/dwellings etc., where the entire consideration is received after issue of occupancy certificate by BMC, leading to a mere transfer of title in immovable property, falls outside the definition of “Service” provided in Section 65B (44) of the Finance Act, 1994, and is therefore, not taxable.

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DSM/MA/AK

Mere transfer of title in immovable property excluded from service tax when sale completes after occupancy certificate issuance. Where the entire consideration for sale of a flat or dwelling is received only after issuance of an occupancy certificate, the transaction is a mere transfer of title in immovable property and falls outside the definition of Service, and therefore is not taxable as service tax.