TMI Blog2010 (10) TMI 504X X X X Extracts X X X X X X X X Extracts X X X X ..... person by any other person in relation to “commercial or industrial construction” and “construction of residential complex” would be a taxable service with effect from 1-7-2010 by Section 76 of the Finance Act, 2010 - the deeming provision contained in the explanation added to Section 65(105)(zzq) and (zzzh) of the Finance Act, 1994 will have only prospective effect from 1-7-2010 - A builder cannot be deemed to be service provider providing any service in relation to industrial/commercial or residential complex to the ultimate buyers of the property - Admittedly, the entire dispute in the present case lies prior to 1-7-2010 - prima facie case against the impugned demand of service tax - Hence, waiver of pre-deposit and stay of recovery ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch sale were shared by the appellant and the land owners. In the third category, the appellant entered into joint venture agreements with land owners, and buildings were got constructed through contractors employed by the joint venture and these buildings were subsequently disposed by sale and the profits were shared. The impugned demand of service tax is on the land value plus cost of building materials plus labour charges and so on. It appears from the relevant agreements that the liability to pay service tax was placed on the contractors. The contractors accordingly paid service tax at the compounded rate of 2.06% as applicable to works contracts . The impugned demand of service tax is on a taxable value, on a part of which the contr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... these explanations is reproduced below :- Explanation. - For the purposes of this sub-clause, the construction of a new building which is intended for sale, wholly or partly, by a builder or any person authorised by the builder before, during or after construction (except in cases for which no sum is received from or on behalf of the prospective buyer by the builder or the person authorised by the builder before grant of completion certificate by the authority competent to issue such certificate under any law for the time being in force) shall be deemed to be service provided by the builder to the buyer;] The above Explanation was added to sub-clause (zzq). The said sub-clause laid down that any service provided or to be provided to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bang.)] wherein the appellant-company was found to have undertaken development of property through contractors for construction of residential complex and it was held to have rendered taxable service defined under Section 65(105)(zzzh) read with Section 65(30a) of the Finance Act, 1994. 5. After considering the submissions, we have found substance in the legal plea made by the learned counsel. Learned Jt. CDR has fairly conceded the fact that, before completion of construction of building complex, advances were received by the appellant from the prospective buyers. Therefore it stands tacitly conceded that the present case is not covered by the clause given in parenthesis in the text of the Explanation. In other words, the present case i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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