Are home buyers exempted from paying SerTax

AOJSM (Student) (93 Points)

02 January 2009  

hello all,

My sister (living abroad) bought a villa for 50lacs in hyderabad. The builder is asking her to pay VAT( @ 4%)and ServTax( @ 4.12%) on the "Cost of Construction=41 lacs" component. Is this correct???

So the point is, I was reading the site/forum and found few articles relating to the exemption given to homebuyers in terms of ServTax by the Govt of India. Is this still applicable as on Jan 2009, and I quote the following:

1. "/news/2007/9/service_tax_relief_for_home_buyers.asp"
2. "/news/2007/9/home_buyers_get_service_tax_waiver_.asp"

From these above articles I understand that she doesn't have to pay ServTax as demanded by the builder. Is

Please enlighten me on the issue and dont hesitate to ask me if u need any clarifications from my end.
 

Also can anybody tell the Circular Number issued on 23Aug,2007 regarding the same.So that it would be handy to have a printout and show the builder if needed.
 


Sai