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Who shall be liable for the VAT charges ?
14-Feb-2023 (In Property Law)
I am purchasing a flat in faridabad wherein possession was provided in 2012 itself. The seller has already carried out sale deed in 2012. As per Haryana government guidelines in 2016, 1 percent VAT is applicable on property which builder is demanding now. Please clarify who is liable to pay the same. I have to close the sale deed next week and flat is still owned by seller only.
A builder cannot charge Value Added Tax (VAT) on transaction for sale of flat effected after he has secured completion certificate for the project from the municipal corporation, the Pune district consumer disputes redressal forum has ruled.
In an order passed on Thursday, a three-member bench of the forum, headed by its president V P Utpat, held city-based construction firm, Kshitij Promoters and Developers in Erandwane, liable for deficiency in service and unfair trade practice for wrongfully collecting 1% VAT from the purchasers of a flat and not returning the same.
The bench, which also comprised members Mohan Patankar and Kshitija Kulkarni, directed the firm and its partners, S P Paranjape and Vinayak D Gokhale, to refund the Rs 70,230 VAT that was collected from complainants Janice D'sa and Leena D'sa within six weeks from the date of order. The firm has also been ordered to pay Rs 20,000 compensation to the complainants towards physical and mental agony.
The construction firm had secured development rights for a land at Pashan and got a building plan approved by the Pune Municipal Corporation (PMC) on March 28, 2007. Post-construction of the project `Crystal Gardens', the firm had secured a completion certificate from the PMC on September 27, 2010.
In an order passed on Thursday, a three-member bench of the forum, headed by its president V P Utpat, held city-based construction firm, Kshitij Promoters and Developers in Erandwane, liable for deficiency in service and unfair trade practice for wrongfully collecting 1% VAT from the purchasers of a flat and not returning the same.
The bench, which also comprised members Mohan Patankar and Kshitija Kulkarni, directed the firm and its partners, S P Paranjape and Vinayak D Gokhale, to refund the Rs 70,230 VAT that was collected from complainants Janice D'sa and Leena D'sa within six weeks from the date of order. The firm has also been ordered to pay Rs 20,000 compensation to the complainants towards physical and mental agony.
The construction firm had secured development rights for a land at Pashan and got a building plan approved by the Pune Municipal Corporation (PMC) on March 28, 2007. Post-construction of the project `Crystal Gardens', the firm had secured a completion certificate from the PMC on September 27, 2010.
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Adv. Siddhant Sharma
Delhi | 500+ Answers
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Builders are demanding 1% VAT, stating that the same is recoverable as per the 2016 Amnesty Scheme notified by the Haryana Govt for the builders to pay their past tax arrears upto March 31, 2014 and to get a reprieve from any penalty or interest payable.
The amnesty scheme no where specifies that the VAT must be collected from the buyer.
You should talk to the builder accordingly.
The amnesty scheme no where specifies that the VAT must be collected from the buyer.
You should talk to the builder accordingly.
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Adv. Ruchira Chaudhary
Gurgaon | 100+ Answers
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