Is service tax payble if a flat is sold after obtaining c/c

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

01 March 2016 Dear Sir,
Kindly let me know whether Service tax is payable if a flat is sold after obtaining of completion certificate from Local Authority( i.e. Corporation or Municipality). In other case if part of flat value is taken beforehand and before taking the balance amount received completion certificate is obtained .Do one has to pay the service tax or not. if he sells his flat after obtaining completion certificate but if he takes advance part of flat value before receiving completion certificate then has he to pay service tax on full amount of consideration money or on the part of Flat Value before receiving completion certificate.

Suresh Ramaswamy

Suresh Ramaswamy (Expert)
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01 March 2016 Service tax is payable by persons rendering the service of construction of commercial / residential premises. the service tax is payable on the abated value of moneys received from the prospective buyer of the property. It is the promoter / developer who renders the service. If a person who has been paying advances to the developer, sells the flat directly to a third party, even before the issuance of Completion Certificate, he is not liable for payment of service tax. However, if the flat is sold back to the promoter and resold by him service tax would be payable.

Any sale of a flat after issuance of Completion Certificate, or any further payment to the promoter / developer thereafter is not subject to service tax.