16 January 2013
5. Whether service tax is applicable on developing a land and selling plots. - Can we call this a service and colonizer a service provider. - A contractor who is developing colony under a contract with developer is liable to pay service tax.
Simple sale of land is not taxable but construction services are taxable @ 25% of 12.36% if it includes value of land in other case 40% of total value.
Yes Contractor is liable to pay tax on 40% of the value as per valuation rules,2006 Rule 2A.
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