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The Finance Ministry on Monday said that in case of sale of flats, the transfer of the title of immovable property after the issuance of an occupancy certificate is exempt from service tax.
“To resolve a long standing issue relating to levy of service tax on sale of flats or dwellings after issue of occupancy certificate but before issue of completion certificate… it has been conveyed… that such a sale where the entire consideration is received after issue of occupancy certificate… leading to a mere transfer of title in immovable property, falls outside the definition of ‘service’ provided in Section 65B (44) of the Finance Act, 1994, and is therefore, not taxable,” said an official release.
The clarification by the Central Board of Excise and Customs regarding cases relating to areas under the jurisdiction of Municipal Corporation of Greater Mumbai or Brihanmumbai Municipal Corporation (BMC).
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