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How the VAT is Calculated on Agreement Value

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How the VAT is Calculated on Agreement Value

Last updated: April 27 2015
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  • Re : How the VAT is Calculated on Agreement Value

    Originally posted by bheeshma View Post
    Dear Jitu_sir,

    Thanks for the exceptionally good advice provided to all the IREF members. If you can educate me on the applicability of the VAT in my case it would be great. My agreement was done on 4th May 2009. The Builder handed a possession letter to me on 27-09-2009 which states that the possession date is 04th May 2009 ( i.e the same date as the Agreement ).

    The builder applied for the OC ( Bogavta Patr ) on 04th April 2009 and received it on 14th May 2009.

    What would be my liability? As i understand, VAT is not applicable on ready possession units on the Date of Agreement. Is my unit ready possession officially, based on the OC dates and Agreement Dates.

    Thanks,
    Bheeshma
    Dear Bheeshma,
    In your case Agreement date is 4th May while OC is on 14th May, hence VAT is applicable. Possession date has to be after OC date.
    Jitendra Pethkar | Pethkar Projects

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    • Re : How the VAT is Calculated on Agreement Value

      Originally posted by Jitu_Sir View Post
      Dear Prakashinani,
      Its a matter ONLY between Builder and first Purchaser.
      Thank you Jitu_Sir

      Sent from my GT-I9100 using Tapatalk 2

      Comment


      • Re : How the VAT is Calculated on Agreement Value

        Dear Jitu_Sir,

        One basic question : What is Indemnity Bond ? Is it some extra document that buyers would have signed apart from the normal Agreements that get executed ?

        Comment


        • Re : How the VAT is Calculated on Agreement Value

          Dear Jitu Sir,
          Occupancy certificate is given by PMC. I had followed up with PMC officials for almost 6 months for my flat in our society and had noticed that these people literally sit on the files. They have all excuses not to do work. So, how come flat be considered as Not Completed if these guys sit on these documents.
          As a builder, do you ever tell your customers that you are not getting ready possession flat even though in exhibition or enquiry, it is said that flat is ready possession.

          Thanks,
          Sandeep

          Comment


          • Re : How the VAT is Calculated on Agreement Value

            Checkout the last page for VAT calculation methods and all other queries (FAQs on VAT) by Govt of MAH..

            http://mahavat.gov.in/Mahavat/MyFold..._8_31_49PM.pdf

            Comment


            • Re : How the VAT is Calculated on Agreement Value

              Originally posted by imemyself View Post
              Dear Jitu_Sir,

              One basic question : What is Indemnity Bond ? Is it some extra document that buyers would have signed apart from the normal Agreements that get executed ?
              Dear imemyself,
              Indemnity Bond is a like a Memorandum of Understanding stating that the Purchaser keeps the builder indemnified from VAT amount which needs to be paid by the Purchaser based on the outcome of the pending judicial case.
              Jitendra Pethkar | Pethkar Projects

              Comment


              • Re : How the VAT is Calculated on Agreement Value

                Originally posted by sakumbhare View Post
                Dear Jitu Sir,
                Occupancy certificate is given by PMC. I had followed up with PMC officials for almost 6 months for my flat in our society and had noticed that these people literally sit on the files. They have all excuses not to do work. So, how come flat be considered as Not Completed if these guys sit on these documents.
                Thanks,
                Sandeep
                Dear Sandeep,
                Sadly but thats the way PMC operates.
                Originally posted by sakumbhare View Post
                As a builder, do you ever tell your customers that you are not getting ready possession flat even though in exhibition or enquiry, it is said that flat is ready possession.

                Thanks,
                Sandeep
                We use the word 'Ready Possession' only when we had received Occupancy Certificate.
                Jitendra Pethkar | Pethkar Projects

                Comment


                • Re : How the VAT is Calculated on Agreement Value

                  Originally posted by Jitu_Sir View Post
                  Dear imemyself,
                  Indemnity Bond is a like a Memorandum of Understanding stating that the Purchaser keeps the builder indemnified from VAT amount which needs to be paid by the Purchaser based on the outcome of the pending judicial case.
                  Thanks Jitu_Sir. In my case, there is no such Memorandum of Understanding. Does this mean that the builder cannot ask me to pay the VAT ?

                  Comment


                  • Re : How the VAT is Calculated on Agreement Value

                    Originally posted by Jitu_Sir View Post
                    Dear Sandeep,
                    Sadly but thats the way PMC operates.

                    We use the word 'Ready Possession' only when we had received Occupancy Certificate.
                    DearJitu_Sir, the posession letter is given only after occupancy certificate is granted ?

                    P.S- Sorry for hijacking the thread.

                    Comment


                    • Re : How the VAT is Calculated on Agreement Value

                      hi Jitu Sir,

                      just saw a program on ibn-lokmat, in which they discussed this issue of VAT. In that discussion, Mr. Sudhakar Velankar of Grahak Hitvardhini mentioned that customers would need to pay the VAT, however, he mentioned that, the customer should ask builder about the VAT calculation -

                      1. how the builder is going to calculate the VAT amount. As we know, VAT calculation can be done by 3 formulae. All 3 calculations should be presented to customer which is certified by CA.

                      In fact, customers should ask builder about these calculations (in details) which should be certified by CA. It is customer's right.

                      2. Out of those 3 amounts, the customers are liable to pay the minimum of these values.

                      Whats your say on this. Is it a better approach mentioned by Mr. Velankar.

                      Are you also going to follow this process.
                      If not which process are you going to follow for it.

                      Comment

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