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Service tax on individual residential bunglows

RAJENDRA MALI (PROPRIETOR) (28 Points)

15 August 2016

A Builder has Constructing Individual residential bunglow for prospective buyers. which having Single permission from authority and alos land is in the name of builder. in this situation builder is liable to clollect and pay service tax in service of service tax act.

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11 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (178258 Points)
Replied 15 August 2016

Yes, the service tax is payable over the underconstruction residential units (being not a single unit), but not-liable after getting completion certificate.

For agrregate value of land and structure @ 4.5% of total value.

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RAJENDRA MALI (PROPRIETOR) (28 Points)
Replied 16 August 2016

Dear Dhiraj lal Ji My Quistion is Service Tax on Construction of Single Residential Bunglows ( independent Units) Which is Not Fall Under the definition of Residential Complex?

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (178258 Points)
Replied 16 August 2016

For you it may be a single bunglow, but liability of collecting & payment of service tax is over Buider, for him its a residential project of more than single unit.

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (178258 Points)
Replied 16 August 2016

RAJENDRA MALI (PROPRIETOR) (28 Points)
Replied 16 August 2016

Dear sir

As per service tax on residential complex definition it is construction of single residential unit is excluded form service tax preview.

Macro Marvel Projects Ltd V SCT 2008 17 STT 479

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (178258 Points)
Replied 16 August 2016

Construction of following original works are exempt:

Services by way of construction, erection, commissioning, or installation of original works pertaining to :

(a)		an airport, port or railways, including monorail or metro;
(b)		a single residential unit otherwise than as a part of residential complex;
(c)		low cost houses up to a carpet area of 60 square metres per house in a housing project approved by competent authority empowered under the ‘Scheme of Affordable Housing in Partnership’ framed by the Ministry of Housing and Urban Poverty Alleviation, Government of India.

Etc. Etc.

As per above single residential unit, is exempt from levy of service tax, but not when part of a Residential Complex.

RAJENDRA MALI (PROPRIETOR) (28 Points)
Replied 16 August 2016

Services by way of construction, erection, commissioning, or installation of original works pertaining to,-

(a) an airport, port or railways, including monorail or metro;

(b) a single residential unit otherwise than as a part of a residential complex;

(c) low- cost houses up to a carpet area of 60 square metres per house in a housing project approved by competent authority empowered under the 'Scheme of Affordable Housing in Partnership' framed by the Ministry of Housing and Urban Poverty Alleviation, Government of India;

(d) post- harvest storage infrastructure for agricultural produce including a cold storages for such purposes; or

(e) mechanised food grain handling system, machinery or equipment for units processing agricultural produce as food stuff excluding alcoholic beverages;

New Delhi, the 20th June, 2012

G.S.R......(E).- In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the said Act) and in supersession of notification number 12/2012- Service Tax, dated the 17th March, 2012, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 210 (E), dated the 17th March, 2012, the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the following taxable services

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (178258 Points)
Replied 16 August 2016

Mr. Tapan Ray:

The earlier definition of residential complex specifically excluded building which has 12 or less than 12 residential units. There is no such exclusion provided in the present statute except sr. No. 14 of Notification No. 25/2012 -ST dated 20.06.2012 where in construction of single residential unit is exempt from payment of service tax

Read more at: /forum/service-tax-on-construction-of-residential-complex-248822.asp