Fw: [aurangabad_ca] Service Tax-inclusion of Builders

Thursday, March 4, 2010 7:12 PM By Livemail

 



Dear Vijayji
 
Though the mail is addressed to SNK, trying to reply to your queries
 
1) The definition of  term residential complex has not been changed, hence  the complexes having more than 12 residential units are only under the net.
 
2) Commercial Construction service as well as Construction of complex services scope has been widened with the explanation inserted by this bill. The explanation is in the nature of deeming fiction which may calls for no. of litigation. Even it calls for its constitutional competency. There is rightly said, Litigation and laws are twins & will go along
 
3) I think the amount received after enactment is only subject to levy so there is no need to divide sale consideration.
 
4) Not to opt abatement is depend upon case to case basis, actual calculation have to work in every case.
 
    Unsold stock as on the date of completion certificate is not taxable at all, this view has been supported by TRU
 
 
 
 
 
 
 
Regards,
 
CA Anand Nahar
 
Shah Khandelwal Jain & Associates
Chartered Accountants,
 
C-6 Balaji Apartment, Behind Hotel Kohinoor Plaza, Nirala Bazar, Aurangabad - 431101
 
Tel: +91 240 2345597
 
Email: anand @ skjglobal.net
 
web: www.skjglobal.net
 
Please consider the environment before printing this e-mail. 1 ton of
paper = 17 trees. Reduce. Reuse. Recycle.
 
 
----- Original Message -----
Sent: Thursday, March 04, 2010 7:34 PM
Subject: [aurangabad_ca] Service Tax-inclusion of Builders

 

Dear SNK,
 
I have gone thru your excellent analysis of Direct and Indirect Taxes.
I have specific query on inclusion of Builders receiving payment in advance for their commercial as well residential complexes?
 
a) Whether construction of residential complexes below 12 units are covered under construction?
b) What about element of land value involved in transaction? It constitutes around 70% of sale value in metros and around 20% to 30% in tier 2 cities.? As per my understanding, this element does not attract     service tax? Abatement is available for construction material only.
c) Service Tax is charged on rendering of service, though deposited on receipt basis.  How to divide the sale consideration between before enactment and after enactment for already booked areas?
 
d) The builders are presently paying Service Tax to Contractors under compounding scheme, for which no input credit can be claimed? Will it be beneficial for the builder to pay at full rate and claim input credit for the same? What about the unsold stock lying at the date of completion certificate?
 
Please share your views on above. Does any representation from ICAI/Industry association required to resolve the issue.
 
Regards
 
CA Vijay Kapur

 

From: SNK <snk@snkca.com>
To: aurangabad_ca@yahoogroups.com
Sent: Wed, 3 March, 2010 5:57:19 PM
Subject: [aurangabad_ca] Budget Analysis - 2010 SNK [1 Attachment]

 

CA GIRISH R. KULKARNI ( AURANGABAD ) CELL NO 92253 06814

Dear Colleagues,

We are forwarding herewith a copy of Budget Analysis, 2010 on Direct & Indirect Taxes with suitable illustrations at appropriate places for easy comprehension of the amendment.

  Thanks & Regards,

 SNK

 snk@snkca.com

snk@youtele. com

 


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