I have purchased new flat in pune.
At time of agreement, builder not gave any information about service tax and VAT.

I did Agreement on 11 Octomber 2010.
As flat was ready so Bank has disbursed all amount of loan (22 lakh) dated 18/11/2010. at one time installment (Only one payment done by bank.)

According to me Bank is done full one time disbursement of loan only if Building is having completion certificate(ready possession flats).

So Now Builder is asking about service tax and VAT amount.

Can you please tell me whether in my cases service tax and VAT is applicable or not
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  • Originally Posted by "md12345
    Dear Jitu Sir,
    I want to register the property (under construction flat in Pune) with my name + my wife's name.
    However, I'm the only earning member and want to take a loan only with my name.
    Is this possible? Or do I have to add my wife's name also when applying for a home loan?

    Dear md12345,
    It's very much possible. You can put both names in the registered agreement, while take loan on your name.
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  • VAT 5% is on agreement cost??

    Hi Jitu,

    I am Sagar, I have booked flat in 2009 at New Mumbai and my registration & agreement was in 2010 Feb.
    Now builder is demanding 5% VAT on agreement value and 2.57 % amount as Service Tax.
    The possession of the flat may be after 3-4 months.

    I have paid about 50% amount to builder before July 2010 and still he is demanding complete 2.57 % over agreement value as a Service Tax.

    I need your suggestion.

    thanks
    Sagar
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  • Dear Jitu Sir and experts;

    I have booked under construction row house in satara.I have paid Rs.5 Lakh to builder till date.Property is not yet registered on my name and still getting constructed (75 percent constructed). Recently I came to know that service tax need not be paid on payments made after C.C.is obtained. I told builder that I will pay the remaining amount (15 Lakhs) once he gets C.C. and then register property on my name; so that i dont have to pay service tax on those 15 lakhs. I suppose I still will have to pay service tax on 5 lakhs I have already paid. Builder is saying that In any case; I have to pay service tax on entire 20 Lakhs. Can you please help me and clarify on what amount I will have to pay service tax?
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  • Originally Posted by "nits555
    Dear Jitu Sir and experts;

    I have booked under construction row house in satara.I have paid Rs.5 Lakh to builder till date.Property is not yet registered on my name and still getting constructed (75 percent constructed). Recently I came to know that service tax need not be paid on payments made after C.C.is obtained. I told builder that I will pay the remaining amount (15 Lakhs) once he gets C.C. and then register property on my name; so that i dont have to pay service tax on those 15 lakhs. I suppose I still will have to pay service tax on 5 lakhs I have already paid. Builder is saying that In any case; I have to pay service tax on entire 20 Lakhs. Can you please help me and clarify on what amount I will have to pay service tax?

    Dear nits555,
    It's now clear that VAT & ST is not applicable for ready possession units having Occupancy certificate. So in your case whether the builder can wait for remaining amount till he receives the OC is the question.
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  • Thanks Jitu sir,

    I will definitely ask builder if he can wait till getting OC.
    So if I understand correctly ;if he agrees to do registration after getting OC , I will not have to pay any service tax and VAT.

    Please confirm my understanding.
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  • Originally Posted by "nits555
    Thanks Jitu sir,

    I will definitely ask builder if he can wait till getting OC.
    So if I understand correctly ;if he agrees to do registration after getting OC , I will not have to pay any service tax and VAT.

    Please confirm my understanding.

    Dear nits555,
    Your understanding in right except you need to pay ST on initial 5 lac payment which is received before registration.
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  • VAT paid but no mention of Sales Tax

    Hi Jitu_sir,
    Would appreciate your inputs with regard to my situation-
    I recently bought a house and registered it on 17th Sept,2012.The Sale deed mentions that builder has got Occupancy certificate in 29th March 2012 .The house is still having some pending work like fitting toilet accessories,doors,windows and final coat of paint .

    Here are my queries:
    1)Can builder obtain OC before completing the finishing work,as mentioned above?

    2)If no VAT/ST needs to be paid if OC has been obtained before registration-which is the case now-,why did he ask for VAT to me.He has not asked for ST though.Have I been fleeced?

    3)By any chance,builder has made a mis-leading statement in registration deed by saying that OC has been obtained?He has even mentioned the Order no. from local authority vide which OC was obtained.I asked for him to show the OC before registration and he said he will send me a scanned copy-I somehow forgot to follow up.I'm planning to get in touch with him now .

    Thanks in advance for any inputs .
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  • Dear Jitu Sir,

    Should the builder put all the Amenities and Specifications mentioned in the Brochure at the time of booking into the Agreement.
    If Yes and if the builder is not agreeing , what can be done so that the builder negotiates?
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  • Originally Posted by "simpleton
    Hi Jitu_sir,
    Would appreciate your inputs with regard to my situation-
    I recently bought a house and registered it on 17th Sept,2012.The Sale deed mentions that builder has got Occupancy certificate in 29th March 2012 .The house is still having some pending work like fitting toilet accessories,doors,windows and final coat of paint .

    Here are my queries:
    1)Can builder obtain OC before completing the finishing work,as mentioned above?

    2)If no VAT/ST needs to be paid if OC has been obtained before registration-which is the case now-,why did he ask for VAT to me.He has not asked for ST though.Have I been fleeced?

    3)By any chance,builder has made a mis-leading statement in registration deed by saying that OC has been obtained?He has even mentioned the Order no. from local authority vide which OC was obtained.I asked for him to show the OC before registration and he said he will send me a scanned copy-I somehow forgot to follow up.I'm planning to get in touch with him now .

    Thanks in advance for any inputs .

    Dear Prashant,
    1. OC can be obtained even when some minor works are pending inside some flats.
    2. If OC is received prior to date of registration then no VAT/ ST.
    3. Actually copy of OC should be attached as an annexure to the registered document. Get the copy of the OC asap.
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  • Originally Posted by "YashRE
    Dear Jitu Sir,

    Should the builder put all the Amenities and Specifications mentioned in the Brochure at the time of booking into the Agreement.
    If Yes and if the builder is not agreeing , what can be done so that the builder negotiates?

    Dear YashRE,
    Builder must mention amenities & specifications as annexures in his Agreement to Sale. Its a sign of transperancy and gives a confidence to the buyer to take his decision. It also restricts the builder to change them as per his wish.
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  • Originally Posted by Jitu_Sir
    Dear YashRE,
    Builder must mention amenities & specifications as annexures in his Agreement to Sale. Its a sign of transperancy and gives a confidence to the buyer to take his decision. It also restricts the builder to change them as per his wish.


    but that doesnt mean builder has to complete it on time... it just means builder agrees to provide this to you *at his convenience*. Most of the builders wont put a date on the amenities completion in the agreement and a few, if put the date, will create caveats under which they can delay it as much as they want.

    in fact, most of the time builder reserves the right to change the amenities details, layout, description/scope etc. and buyer has nothing he can do..

    ready possession or resale is the only true picture!
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  • Thank you Jitu_sir

    Originally Posted by Jitu_Sir
    Dear Prashant,
    1. OC can be obtained even when some minor works are pending inside some flats.
    2. If OC is received prior to date of registration then no VAT/ ST.
    3. Actually copy of OC should be attached as an annexure to the registered document. Get the copy of the OC asap.


    Thanks a bunch Jitu sir .I still have some payment to make-will ask for adjustment for payment already made under VAT head and also try to get the copy of OC.
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  • Originally Posted by "punerebuyer


    but that doesnt mean builder has to complete it on time... it just means builder agrees to provide this to you *at his convenience*. Most of the builders wont put a date on the amenities completion in the agreement and a few, if put the date, will create caveats under which they can delay it as much as they want.

    in fact, most of the time builder reserves the right to change the amenities details, layout, description/scope etc. and buyer has nothing he can do..

    ready possession or resale is the only true picture!

    Dear punerebuyer,
    A builder is like 'Jack of all trades, Master of none'. He has to deal with N number of agencies & situations in order to complete his project. Many times he is unaware about incidental hurdles that arise because of reasons beyond his control while sometimes his inexperience about handling the progress of the project comes into play.
    That doesn't mean he should complete the things as per his convenience, but should keep his buyers aspirations at first place by providing the committed things in reasonable time frame.
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  • Originally Posted by Jitu_Sir
    Dear punerebuyer,
    A builder is like 'Jack of all trades, Master of none'. He has to deal with N number of agencies & situations in order to complete his project. Many times he is unaware about incidental hurdles that arise because of reasons beyond his control while sometimes his inexperience about handling the progress of the project comes into play.
    That doesn't mean he should complete the things as per his convenience, but should keep his buyers aspirations at first place by providing the committed things in reasonable time frame.


    That remark wasn't specific to you jitu_sir... Today itself someone posted another scheme named meadows and the false promises... I had already had several posts on your scheme so won't add that here... :)

    And in this point, please understand that even a buyer has to (in most cases) work for life long to gather the money to pay to the builder... Clearly the stakes are much higher for him but the any agreement doesn't care about that at all...
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  • Originally Posted by Jitu_Sir
    Dear punerebuyer,
    A builder is like 'Jack of all trades, Master of none'. He has to deal with N number of agencies & situations in order to complete his project. Many times he is unaware about incidental hurdles that arise because of reasons beyond his control while sometimes his inexperience about handling the progress of the project comes into play.
    That doesn't mean he should complete the things as per his convenience, but should keep his buyers aspirations at first place by providing the committed things in reasonable time frame.

    Thanks Jitu_Sir and punerebuyer for your reply.

    I agree with your views. However, I am not worried about the timely delivery of Amenities by the builder at this point of time. The builder has already started construction of apartments at a high pace.I am at a very initial stage where I have just done the booking and going for the agreement.However, my problem is that the builder only mentioning a handful of Speciifcations and Amenities as compared to those mentioned in Brochure.I am more concerned on the specifications side since that is what I have to live with after possession as compared to Amenities which is a shared thing and builder will defintely try to give good amenities to sell future buildings.
    Some of the distinctive specifications like Make of modular switiches , Provisions for usage (Geyser,exhaust fan,water purifier ,inverter back-up ,washing machine,internet,TV and telephone points), laminated wooden flooring and deorative door is mentioned in Brochure but not in Agreement.
    On top of this I think putting make of the fittings in the apartment and lift in the agreement is very important.

    Am I being resonable in asking Builder to put these specifications and make of fittings/lift in agreement? If Yes, How can I negotiate with the builder to do so?
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