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Is service tax applicable on society mainteinance?


03-Apr-2023 (In Tax Law)
Hi Team, Please confirm if builder can charge service tax on society maintenance while giving possession of new flat. I'm about to get possession of my flat and builder is charging 2 years of maintenance with 15% of service tax in advance. While checking online I came across one website where it's mentioned that builder can charge but there are some exceptions as if monthly maintenance is less than 5000 then service tax is not applicable, is that the case? While discussing with builder, they told that it's applicable when ST is charged by builder however when society is formed after that ST is not applicable, is it true? Please help on this.
Answers (1)

Answer #1
960 votes
As per the latest CESTAT judgements, such one time maintenance charges are not liable to undergo service tax. Even when the housing society is formed, then based on the principle of mutuality, service tax is not leviable.

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