Service Tax and VAT on under construction apartment

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Hi,

I had booked an apartment in 2009 and am getting the possesion by June 2012. I paid 4300000 for the unit and 250000 for the car park. A total of Rs. 4550000. Now the builder is asking me to pay ST and VAT on the total cost of Rs.4550000. But I got to know from a few sites that ST and VAT is calculated excluding the car park cost? Is this true? If yes, can someone please point me to an official government site/document where it is clearly stated that car park cost is excluded. I tried to speak to my builder about this but he said the unit cost means a total cost including the car park. Further this tax amont has to be paid as DD in the favor of the builder. Hence I am all the more doubtful about this as I wont have a proof as to that amount being paid actaully reaches completely to the government.  Harsha and others please share your comments on this as I am sure many of us who have booked under construction apartments will surely face this too.

Thanks,

Shashi

Tags: asked May 10, 2012

1 Answer

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Have a look at http://www.raagvamdatt.com/budget-2010-2011-service-tax-on-property-house-apartments-flats

 

service tax can’t be on the full amount, since essentially cost of construction has to be reduced.

 

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