/ CBDT

CORPORATE AND PROFESSIONAL UPDATE JANUARY 25, 2016

CORPORATE AND PROFESSIONAL UPDATE JANUARY 25, 2016

www.caindelhiindia.com; SERVICE TAX
www.caindelhiindia.com; SERVICE TAX

ST: VALUATION OF FLATS GIVEN BY BUILDER TO LANDOWNER AND POT THEREOF

CBEC Circular No. 151/2/2012-ST dated 10.2.2012 on following issues:

  • Valuation of construction service; and
  • Point of taxation thereof.

According to the CBEC Education Guide on Taxation of Services, 2012:

  • Value of construction service provided to such land owner will be the value of the land when the same is transferred; and
  • The point of taxation will also be determined accordingly i.e. POT will be date when land/rights in land is handed over to builder/developer.

However, Circular No. 151/2/2012-ST dated 10.2.2012 states that:

  • Value of land / development rights in the land may not be ascertainable ordinarily and therefore, value, in the case of flats given to the land owner, would be equal to the value of similar flats charged by the builder/developer from prospective buyers; and
  • Point of taxation will be at the time when the possession or right in the property of the said flats are transferred to the land owner by entering into a conveyance deed or similar instrument (e.g. allotment letter).

To resolve this dilemma, it is directed, vide F. No. 354/311/2015-TRU dated 20th January, 2016,that the Service Tax assessing authorities should be guided by the said Board Circular dated 10.2.2012 and not the Education Guide.

IT : CBDT: SPECIFY THE PROCEDURE FOR ISSUING REFUNDS EXCEEDING RS. 5000; STIPULATES 30 DAYS FOR DEMAND-ADJUSTMENT U/S 245

CBDT lays down detailed procedure for issuing refunds exceeding Rs. 5000 where notice u/s 245 (for adjustment of refund against outstanding arrears) has been issued to taxpayer-assessee; Earlier this month, CBDT had directed prompt issuance of refund upto Rs. 5,000 without any adjustment of outstanding arrears; For cases not covered by earlier relaxation and where Sec 245 notice has been issued, CBDT now directs CPC to issue refund without any adjustment where assessee has contested the demand and no response is received from AO within 30 days; Likewise, when there is no response from assessee within 30 days, CBDT directs CPC to adjust demand against refund due and issue balance refund, if any. (OFFICE MEMORANDUM ISSUED BY THE CBDT DATED 29-01-2016)

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Hope the information will assist you in your Professional endeavors. For query or help, contact :  info@caindelhiindia.com or call  at 011-233 43 333

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