Service tax on under construction flats

[GOWRI SANKAR]

The Division Bench of the High Court of Delhi in the case of Suresh Kumar Bansal vs. UOI (W.P. 2235/2011) by its order dated 03.06.2016 has held that service tax is not leviable on the under construction flat being sold by the developer to the buyer. The Hon’ble High Court allowed the buyer to claim refund of service tax paid by them to the builders along with interest @ 6% p.a.. The above judgment is in line with the ratio aid down by Supreme Court in the case of L&T and has come as a big relief to the buyers paying service tax w.e.f. 01/07/2010. In view of the above decision of the Delhi High Court, buyers may approach the High Court for seeking similar relief.

Forwarded as received.