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2012 (6) TMI 363 - AT - Service TaxConstruction of residential complexes - appellant under Joint Development Agreements with land owners assigned portion of the constructed area, in the form of flats / houses, in favor of the land owners and sold remaining constructed area, in the form of flats/houses, to various buyers - dispute in the nature of non-payment of tax in respect of flats handed over to land owners - Held that:- Relationship of service provider and service receiver - In instant case, since UDS is registered in name of land owners and then the Developer constructs flats for the original Land Owner, becoming UDS holder after registering UDS in his name. Hence it is clearly outside the scope of the clarification given by CBEC and there is a service provided to the UDS holders including the original Land Owners. Also, residential complexes in question were not constructed for personal use of the owners of the land. It was predominantly for sale to individual buyers and was thus covered by the definition of the service. On contention that that there was no provision in law prior to 19-04-2006 to tax consideration received other than in the form of money it is held that once it is decided that tax was payable on the activity, the liability cannot be set to naught because the section dealing with valuation specified only amounts received. It is well-settled that the court would construe the statute in such a manner so as to make the machinery workable. Valuation of flats given to land owners - assessee contending different valuation on ground of point of time of transfer of land - Held that:- Since flats handed over to the land owners were not different from what were sold to the individual buyers, hence it does not warrant assessment of a different value for services in respect of flats handed over to land owners as compared to flat sold to individual buyers. Time bar - Since there has been persistent resistance on the part of the appellant in providing the required information, hence appellant cannot claim benefit of bonafide belief and argue that demand for a period of one year from relevant date only will apply. Flats sold to Individual buyers - assessee contended that flats are constructed and sold and hence the construction service is for self - applicability of circular dated 29-01-2009 issued by CBEC - Held that:- Since UDS was first registered and then an agreement to construct was entered into. Therefore the clarification dated 29-01-2009 issued by CBEC does not apply in this case. Registration fees and stamp duty paid by the appellant and recovered from the buyers - held that:- the expenses relating to stamp duty and registration charges cannot be considered as expenses incurred in the course of providing the service. These are not reimbursed expenses incurred on behalf of the clients and in our view the expenses are outside the scope of the expression of reimbursable expenses very commonly used in the context of value of services. - to be excluded subject of verification. Applicability of definition of a residential complex only to cases where one building has more than twelve flats or will extent to cases where different buildings in the same compound totally having more than twelve flats - Held that:- Expression residential complex will apply only in case of buildings which have more than twelve residential units.It is an agreed fact that this was not the case in respect of Kamakotivilasam project. So we are of the view that the demand in respect of Kamakotivilasam project is not sustainable and the same is set aside.
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