Hello Experts, I need advice please. This request is regarding my flat which was completed on 17 June 2017 in Bangalore,KA and builder raised the final settlement bill as below.


Sl. No
Descriptions
Amount
Vat
ST
Total


1
Instalment Due
53177.56
5398
3191
61766


2
Club House Fee
40000

6000
46000


3
External Electrification, water & Sanitation Charges @ Rs. 200/- Per sqft
202000

12120
214120


4
Building Maintenance charges Rs. 2/- per Sqft Per Month (For One Year)
24240

3636
3636


5
One time corpus fund which is equivalent to one year's maintenance charges
24240


24240


6
Campus maintenance charges - lump sum @Rs.60/- per sft
60600


60600


7
Service Charges Towards Property Tax Assessment and Sub numbering
10000

1500
11500
















Total Payable
446102



When my bank paid the bill on July 5, the builder raised a differential invoice on account of GST as below, he says I have to pay more under GST as I did not clear the payment by 30 June 2017.


Sl. No
Descriptions
Amount
GST
Total


1
Instalment Due
53177.56
9572
62750


2
Club House Fee
40000
7200
47200


3
External Electrification, water & Sanitation Charges @ Rs. 200/- Per sqft
202000
36360
238360


4
Building Maintenance charges Rs. 2/- per Sqft Per Month (For One Year)
24240
4363
28603


5
One time corpus fund which is equivalent to one year's maintenance charges
24240

24240


6
Campus maintenance charges - lump sum @Rs.60/- per sft
60600

60600


7
Service Charges Towards Property Tax Assessment and Sub numbering
10000
1800
11800















Total Payable
473553




Please note that the builder has put 18% GST where previously VAT/ST were applicable. I am suspicious about their motive but thought to check with experts, Can you please clarify if builder's claim is right ?
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  • Installment Due: Your builder has quoted 18% GST while it should be 12% only.

    Club House Fee: I assume this is club membership fee. At membership fee of Rs, 40,000/- then even if it is per year charge (I know they say it is for lifetime membership) then it costs just Rs. 110/- (40,000/365 = 110). If the rent is less than Rs. 1000/- per day then GST is exempted under clause 74 and I'm giving it below "as is":

    <<
    74. Services by a hotel, inn, guest house, club or campsite, by whatever name called, for residential or lodging purposes, having declared tariff of a unit of accommodation less than one thousand rupees per day or equivalent
    >>

    Service charges for property tax related obviously fall under financial related transactions so 18% GST is correct.

    Electric work & maintenance: The builder (but not your "Association" as I understand) is charging these as part of contract. I downloaded the GST booklet and noticed this should be exempted from GST. The clauses are provided below "as is" which are under "exempted" category:

    <<
    66. Services provided by way of pure labour contracts of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of a civil structure or any other original works pertaining to the Beneficiary-led individual house construction / enhancement under the Housing for All (Urban) Mission/Pradhan Mantri Awas Yojana (PMAY);
    67. Services by way of pure labour contracts of construction, erection, commissioning, or installation of original works pertaining to a single residential unit otherwise than as a part of a residential complex
    >>

    I hope the above should give a head start for your discussion with the builder. Take a print out of GST booklet and show clauses pointed above to him.
    CommentQuote
    3 Comments
    • try_samar3 years ago
      Thanks again for your kind comments. Yes, I know all of these folks who charge GST @18% or 28% never reaches government, they always maintain dual billing systems and consumer is at the receiving end.
  • Can anyone help me on this query?
    I am in search of an apartment to buy. I visited couple of projects last this June and continuing on July as well. As we all know GST came into picture now from July 1st. Initially one builder shared me the cost sheet with VAT/ST. Later after negotiation another cost sheet I received before few days (in July after GST) containing the same VAT/ST. Now the builder is telling me that cost sheet is not as per GST. The cost will go up for sure. But we can’t say how much. You can go ahead with booking. (by making payment). Later you will be knowing.
    Based on the approx GST % they shared my cost might increase approx 1.4 lakh more. Now I am thinking whether to book or not.
    Again thinking to wait for 2-3 months to get all the cost sheet revised based on GST and then to search and finalize the property along with the price.
    Any suggestions????
    CommentQuote
    1 Comments
    • inboxsurvey3 years ago
      Better to wait for the revised GST price.
  • Thank you very much for your response. Will wait till the builders come up with revised price as per GST.
    CommentQuote
  • try_samar, I believe that you need not pay any GST. The demand for installment was raised by your builder before june 2017 (installment was due before June 2017).
    CommentQuote
  • Your statement is false. This is like saying you took insurance policy 5 years ago so you pay 14% tax as earlier and not 18% current tax. It deosn't matter when the due is, it matters when the amount is being paid. If you are paying today, the rules applicable today would be valid irrespective of due is before or after GST.
    CommentQuote