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- Service tax on realty may land in SC
The Confederation of Real Estate Developers’ Association of India (Credai) plans to move the Supreme Court against Union Finance minister P Chidambaram’s Budget proposal of imposing a 12.36% service tax on “renting of immovable property for use in commerce or business."
Raj Menda, secretary of Credai, the national body of 16 regional real estate associations, said that the finance minister’s service tax proposal is not constitutional as land tax is a state subject.
Since the building is on the land, any kind of tax on the building can only be imposed by the state government. The central government can't slap any tax.
Menda said that the association will soon submit its demand to revoke service tax to the finance minister. If the finance minister does not agree with us and Parliament passes the Budget with service tax on lease rentals in place, we will move to the Supreme Court.
Menda said Credai has already spoken to come senior advocates on the possibility of moving court on the issue.CommentQuote0Flag