Wednesday, October 31, 2012

1 per cent VAT on Flats bought between June 20, 2006 and March 31, 2010?

Maharashtra Government to issue an order today?:


As per the news of ExpressIndia, to pacify the united property buyers, today, Maharashtra Government may issue an order for adopting a simple procedure of charging 1 per cent VAT on Agreement Value for the flats purchased between June 20, 2006 to March 31, 2010. The same rate applicable for the flats purchased from 1st April 2010.

Yesterday, on 30th October 2012, Bombay High Court dismissed Maharashtra Chamber of Housing Industry-Confederation of Real Estate Developers Association of India (MCHI-Credai) "petition without merit" and ordered the builders to pay 5 per cent VAT before 31st October 2012.

However, according to TNN, the court held out 'a ray of hope' by saying the order would not come in the way of Maharashtra Government taking a decision applying post-April 2010 scheme to flats purchased between 2006 to 2010.

As of now, according to Vivek Velankar of Sajag Nagrik Manch, nearly 30-50 per cent property buyers have refused to pay VAT. Which, for sure, has affected the recovery of 5 per cent VAT on the flats purchased between 2006 and 2010.

So, the builders are trying their best to convince the Maharashtra Government to adopt a simple procedure of charging 1 per cent VAT on the agreement value - as per the prevailing norms.

Related Stories:


1) Bombay High Court gives no relief to builders on VAT

2) घर खरेदी : व्हॅटची जबाबदारी बिल्डरांचीच

3) हायकोर्टाचा बिल्डरांना दणका;व्हॅट भरावाच लागणार

4) Bombay High Court to give verdict on VAT today

5) Flat Owners Who Have Already Paid VAT Join the Fight!

6) 31st October Deadline is for Builders!

7) VAT - Questions & Answers

8) Pune Flat Owners United Against VAT

9) 'Builders confusing flat owners about VAT payment'

10) We refuse to pay VAT!

11) How to Refuse to Pay VAT

12) MCHI-Credai moves court against VAT

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8 comments:

  1. So in nutshell, VAT is applicable to flats/houses sold between 2006 onwards. 5% as of now. But question really is not whether VAT is applicable or not but it is whether buyer or builder has to pay this sum. This is not addressed in this petition. Now buyers who were not charged VAT and given possession have united to not pay tax. But that doesn't invalidate obligation to pay the tax. So what relief the court has given to common people? as usual common man (new buyers and even existing ones) will be coerced to pay VAT

    ReplyDelete
    Replies
    1. Try not to mix petitions and jump to conclusion, PuneHomeBuyer!

      Delete
  2. Hi Ravi,

    thanks for update, As my builder sent us legal notice through lowyer to pay VAT before 31st October 2012, which is near to 3.39% of sales value. Also mentioned if we are fail to pay this VAT on given time then we are liable to pay Interest & Panelty.
    Please suggest.

    ReplyDelete
    Replies
    1. Dear Yesh, Go to Grahak Peth. Grahak Panchayat, Sajag Nagrik Sangh & Grahak Hitwardhini have arranged , a team of lawyers. Contact:
      Mr. Vijay Sagar, Advisor, Builder Related Problems,

      Grahak Panchayat Pune Office
      Above Grahak Peth, Opposite S. P. College, Tilak Road,
      2020, Sadashiv Peth, Pune - 411030

      Every Monday, 6 pm - 7.30 pm

      94 22 50 23 15 / vsagar1963@yahoo.co.nz

      Google Map: http://goo.gl/maps/tdv5P

      Delete
  3. Hello Ravi,

    Thanks for the information, our builder had demanded flat 5% of agreement value, he had not bothered to produce any breakup of the calculation, we have already paid 1% of agreement value at the time of possession, in his latest demand of vat notice the 1% that we already paid wet the time of possession doesn't reflect, and he simply demanded 5%. We all are confused as to what to do. We have sent him a reply by registered post demanding vat calculation, breakup and 1%.vat that we have already paid. But there is no response from him, we don't know what to do. Please advise.
    Rajeev

    ReplyDelete
  4. Hello your post is really too informative
    And i recommend to choose residential property in Property For Sale in Sec 119 for best deals,also recommends to invest in Eldeco Inspire Sector 119 Noida
    for best return on investment.this is my personnel opinion and experience.

    ReplyDelete
  5. Dear Ravi,
    I had Purchased a Flat in 2009. What will be the percentage of VAT Payable on the Agreement amount of 24L.

    ReplyDelete
  6. Hello Ravi,

    So, what is the last verdict? There are so many confusing news. I have series of questions:
    1. Do flat owners who purchased flat during 2006 to 2010 will have to pay VAT?
    2. If answer of #1 is Yes then how much VAT, what is the calculation, is it on construction cost or the flat agreement value?

    I will be of great help you can answer he questions as I have already got the possession in 2009, but my builder is saying unless I pay VAT he won't to Conveyance Deed, which is very necessary to own the flat in true sense.
    Please guide.

    Thanks

    ReplyDelete