Need advice on Service Tax & VAT

Q: I have finalized a flat in north Bangalore & about to enter into an agreement. There are two agreements, i.e., 'Build' & 'Sell' agreement. In the sell agreement (for UDS proportion), the value mentioned is INCLUSIVE of service tax and VAT. I want to know if land (UDS portion) attracts service tax & VAT. Please advice.

Arun Kumar, Apartment Resident, Bangalore

2nd January 2014

Other in Fortuna Center Park, Sahakara Nagar, Bangalore

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Hello Indrajit, thanks for the advice and your time. I appreciate for coming back to me on this quickly. I am not sure, however, this is what the builder has to say. Please see the notification in the URL and want to know the relevance here.

http://www.servicetax.gov.in/notifications/notfns-2012/st26-2012.htm

Thanks in advance for your time and advice, Regards, Arun

Arun Kumar, Apartment Resident, Bangalore

4th January 2014

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Hello Arun, As far as i know when you buy a flat you buy two things from the builder 1. Undivided Land of Share and 2. The flat.

Both VAT and Service Tax (As on Jan 2013 ...Service Tax @ 12.36% on 25% of BASIC Price ( if Land Cost is included ) otherwise 12.36% on 33% of Basic Sale price ) need to be paid on basic selling price of the flat and not on Undivided Land of Share.

Keep me inform how you have paid the Service tax and VAT while entering into an agreement.

Indrajit Kaul, Bangalore

2nd January 2014

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