CA Shraddha Vora (Teamhead) (149 Points)
21 December 2013Hello ALL,
My query is related to PLC (Preferential location Charges) which are related to constrction services of a residential complex.
PLC came into existence as on 1/7/10 along with construction services.
If a demand note is issued before 01/07/10 for PLC and the provision of service was also before that day, but the customer makes payment or takes possession after 01/7/10, am i liable to pay service tax on that amount?
Ankit
(CA, CS)
(3064 Points)
Replied 21 December 2013
Dear Shraddha,
it depends on the date of entering into the agreement. If the agreement is entered into post it coming into existance, then you are liable to pay Service Tax on the PLS.
- Ankit
CA Shraddha Vora
(Teamhead)
(149 Points)
Replied 21 December 2013
Dear Ankit,
Agreement has been entered before 01/07/10 but in agreement it is written that the amount has to be paid on or before possession.
So does it mean that the date of provision of service would be the date of possession and not completion of building or date of issue of demand note.
Also, for your reply above, could you please tell me on what basis you confirmed it as exempt.
Thank you for replying.
Ankit
(CA, CS)
(3064 Points)
Replied 21 December 2013
Dear Shraddha,
As per the Transfer of Property Act, the transfer completes on the date of the registration of the agreement and not on the date of the possession.
Thus, the transfer got completed on a date before the taxability of the service. This is the Point of Taxation.
Thus i am saying it is exempt.
If you have any more queries...pl feel free to ask
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