Sr. No 12 of notification 26/2012-ST dated June 20, 2012 amended vide notification no. 2/2013 ST dated 1.3.2013.

At present taxable portion for service tax purpose is prescribed as 25% uniformly for constructions where value of land is included in the amount charged from the service recipient.

This is being rationalized.

Accordingly, where the carpet area of residential unit is upto 2000 square feet. or the amount charged is less than One Crore Rupees, in the case of 'construction of complex, building or civil structure, or a part thereof, intended for sale to a buyer, wholly or partly except where the entire consideration is received after issuance of completion certificate by the competent authority', taxable portion for service tax purpose will remain as 25%; in all other cases taxable portion for service tax purpose will be 30%.

This change will come into effect from the 1st day of March, 2013.

Example:

Situation	Taxable Portion
Value is Rs. 99.99 lacs and Carpet Area is 2000 sq ft.	25%
Value is Rs. 99.99 lacs and Carpet Area is 2000 sq. ft	25%
Value is Rs. 1 Crore And Carpet Area is 2100 sq. ft.	30%
Value is Rs. 1.1 Crores And Carpet Area is 2000 sq. ft.	25%
Value is Rs. 1.1 Crores and Carpet Area is 2100 sq. ft.	30%

 Need to mind that:

Value cap is Less then One Crore Rupees and Carpet Area Cap is upto 2000 sqare feet.

Taxable portion for construction services adjusted: lower portion for smaller or lower value residential units, higher portion otherwise. Amendment adjusts the taxable portion for service tax on construction of complexes, buildings or civil structures where land value is included: for residential units intended for sale, the lower taxable portion applies if either the carpet area is within the prescribed threshold or the charged amount is below the prescribed threshold; otherwise a higher taxable portion applies, with an exception where full consideration is received only after issuance of the completion certificate.