I made my final payment for possession of my flat in Thane. Was surprised to be informed to pay another 2.37% odd as service tax on the final payment. Agreeement registered on FEB 2008.

The surprising element is that the builder has sought the S.T. only on the final payment and not on the entire cost. Furthermore it was levied since the cut-off was June2010. Infact my friend who made the payment June-enddidn't have to bear the same. I am sure you cannot have different structures of service charge for similar flats based on the receipt of payment. If someone is conversant with the law, please shed some light.

All whose payments are in the pipeline do cheque up with ur developer/builder
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  • Hi,
    Service tax of 2.37% is applicable on the amount accrued to buidler post 31st June 2010.
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  • As the Metallica song goes 'Sad But True'
    I am also in the middle of making payments for my Thane flat. I was told by my builder that all payments I make after 30th of June will include the service charge. Therefore he suggested that if I wish to avoid that charge I should pay as much as possible before 30th of June. I therefore paid-up for 3 more slabs.
    Consider yourself lucky that you had to pay only for your final installment!!
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  • Thks, appreciate for the inputs
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  • Any payment made after 1st of july to the builder will attract a service charge as levied by the govt. It also depends on the construction stage of the builing. For example if the blg is say 80% complete and payment due if 40% then service tax will be applied only on the 20% as per the construction stage. This is what I got to know from Mahindra Developers today..
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  • Now this is bit complicated...:bab (6):

    Originally Posted by shivkumar2
    Any payment made after 1st of july to the builder will attract a service charge as levied by the govt. It also depends on the construction stage of the builing. For example if the blg is say 80% complete and payment due if 40% then service tax will be applied only on the 20% as per the construction stage. This is what I got to know from Mahindra Developers today..
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  • If that was the case Mr. Shivkumar, say a flat in my building which was completed prior to 30th June would not attract any tax. There are people who have taken possession already implying the building is complete, however I still have to shell out Service tax on my last tranche.

    There is bound to be some ambiguity in the intepretation at the onset and all inputs are welcome.
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  • This issue needs some more clarity on the implementation of service tax. Some builder will start taking advantage on the same while some will bring clearity or throw some light. Its better to wait and watch for now..
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  • Originally Posted by sagi7
    If that was the case Mr. Shivkumar, say a flat in my building which was completed prior to 30th June would not attract any tax. There are people who have taken possession already implying the building is complete, however I still have to shell out Service tax on my last tranche.

    There is bound to be some ambiguity in the intepretation at the onset and all inputs are welcome.


    If the demand from the builder for the last payment has come in before July'01 then you dont have to pay service tax. The service tax from developers will be mentioned on the invoice/demand notice.
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  • Dosti Group Is asking for the service charge on payment made from august onwards.

    I am not convienced as I doubt -is it really going to happen?
    but if yes then I would be more than happy !
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