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TMI Blog2014 (2) TMI 620X X X X Extracts X X X X X X X X Extracts X X X X ..... for construction of the flats and they had collected money for construction and they are rendering services to other persons. In view of that, the contention of the learned advocate based on point of registration of UDS is not relevant. - application rejected. - ST/S/354-356/2012 and ST/448-450/2012 - MISC ORDER No.40412-40414/2014 - Dated:- 27-1-2014 - Shri P.K. Das and Shri Mathew John, JJ. For the Appellant : Ms. Radhika Chandrashekar, Advocate For the Respondent: Shri Parmod Kumar, JC (AR) ORDER Per Mathew John 1. The applicant has filed these applications for modification of Stay Order No.41959-41961/2013 dt. 29.7.2013 which decided stay petitions filed in three appeals, namely, ST/448-450/2012. As per the stay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d then construction undertaken and consideration received for such construction." 3. She submits that as per applicant's business model two agreements are executed simultaneously (i) an agreement to sell Undivided Share in land ( UDS for short) and (ii) an agreement to do construction activity on the UDS. She submits that after receiving around 70% of the consideration, they register the UDS in the name of the prospective buyers. In the meanwhile, the construction activity also proceeds. As against such facts it is recorded in para-3 of the stay order that UDS is first sold and thereafter construction is undertaken. She submits that this mistake in fact may be corrected. She has also given sample of copies of agreement for sale and memor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he argues that there is no need to correct the fact recorded and there is no need to change the finding that UDS was sold first and thereafter construction was done. If at all any change is to be made it is only by of a change in a few words or sentences in para-3 of the order to make the position clearer. But the position remains that land is sold first and thereafter construction service is rendered as per a separate agreement. He submits that the department is demanding tax only on the service rendered as per construction agreement. He further submits that applicants have never made a submission that registration of sale was done for the constructed flats. The registration was done only for the UDS which implies that the construction was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of UDS. For the entire transaction registration of sale with local authorities maintaining land records is only for sale of UDS and there is no registration of the constructed flats. The issue to be decided is whether there is relationship of service provider and service recipient exists in the facts of this case." 6. The sentence in 6th line of para 22 of the order that is,- "When UDS is sold the person to whom UDS is sold becomes the legal owner of UDS" is to be replaced with sentence "When construction for UDS is taken up, the land is effectively sold and the buyer has an enforceable right against the applicant for the UDS". 7. There is a prayer that sentence in 6th line occurring in para 23 starting with "whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the above terms. (Dictated and pronounced in open court) Per Pradip Kumar Das 9. I agree with order of my learned brother and I would like to record my further observation as under. 10. On a query from the Bench, the learned advocate on behalf of applicants submits that in the present case, during the process of construction of the flats, after 75% to 80% of payment is received UDS is registered and therefore, even if tax is leviable it should be calculated for the activity done after the registration of UDS. She submits that prior to registration for UDS there is no service rendered to other persons. 11. Section 65 (91a) of the Finance Act, 1994 defines the "residential complex service". The definition makes it clear that 'res ..... X X X X Extracts X X X X X X X X Extracts X X X X
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