TIOL-DDT 2712
27 10 2015
Tuesday

AS per Section 66E(b) of the Finance Act 1994, the following shall constitute declared services, namely: -

(a) renting of immovable property;

(b) construction of a complex, building, civil structure or a part thereof, including a complex or building intended for sale to a buyer, wholly or partly, except where the entire consideration is received after issuance of completion-certificate by the competent authority.

So, if a builder sells a flat before issuance of completion-certificate, he is liable to pay Service Tax on the sale of the flat!

And there were disputes on this for the last ten years or so.

It seems in places like Mumbai Metropolitan Region (MMR) comprising of Municipal Corporation of Greater Mumbai, Thane, Kalyan, Navi Mumbai, Ulhasnagar etc. as per Municipal Corporation Act for time being in force, the building completion certification is furnished by the licensed surveyor or any person approved by the Commissioner to erect the building. Once the occupancy certificate is granted for the premises it signifies that construction of building is completed. But the Law says you need a completion certificate.

We had carried an article on 25.02.2015, Occupancy Certificate equals Completion Certificate? wherein the author had suggested to the Board to issue a Circular/Instruction to clarify that no service tax shall be applicable in case of sale of premises after grant of occupancy certificate by the competent authority.

Board has responded! In a Press Note issued yesterday, CBEC clarifies,

In order to resolve a long standing issue relating to levy of Service Tax on sale of flats/dwellings etc. after issue of occupancy certificate but before issue of completion certificate in areas under the jurisdiction of Municipal Corporation of Greater Mumbai i.e. Brihanmumbai Municipal Corporation (BMC), it has been conveyed to the Service Tax Authorities in Mumbai on Friday, 23rd October, 2015 that sale of flats/dwellings etc., where the entire consideration is received after issue of occupancy certificate by BMC, 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.

Now this is a very important clarification from the Board and it comes out in the form of a Press Note! And will the Board clarify whether this clarification applies only to Mumbai and not other cities. Should the builders in other cities approach the Board for similar clarifications?

PIB Press Release.

FTP - Import Policy of Human Embryo - Prohibited

THE present policy for Import of Human Embryo is free subject to a 'No Objection Certificate' from Indian Council of Medical Research (ICMR).

Now this is changed to:

Import of Human Embryo is "Prohibited" except for research purposes based on the guidelines of the Department of Health Research.

DGFT Notification No.25/2015-2020, Dated: October 26, 2015

FTP - Services Exports from India Scheme (SEIS) - Eligible period extended

THE earlier notified period of services export rendered between 1-4-2015 to 30-09-2015 as per the list comprising rates and conditions for rewards under the Services Exports from India Scheme (SEIS) notified vide Public Notice No. 3/2015-20 dated 1st April, 2015 is extended upto 31.03.2016.

The Note 1 of Annexure to Appendix 3D read as: The services and rates of rewards notified against them shall be applicable for services export made between 1-4-2015 to 30-09-2015 only. The list of services/rate is subject to review with effect from 1-10-2015.

Now, it reads as: The services and rates of rewards notified against them shall be applicable for services export made between 1-4-2015 to 31-03-2016 only. The list of services/rate is subject to review with effect from 01-04-2016.

DGFT Public Notice No.42/2015-2020., Dated: October 26, 2015

CBEC - Cases Pending Adjudication - Revenue Secretary Seeks Monitoring

IN a letter to all Chief Commissioners of Central Excise, Customs and Service Tax, the CBEC Member Ms. Ananya Ray notes that it is seen from the Monthly Performance Report (MPR) for the month of August 2015, that a large number of cases are pending adjudication before the adjudicating authorities at all levels. Secretary (Revenue) has in this regard directed that proper monitoring and reporting mechanism of these cases should be put in place, so that they can be disposed off within a prescribed time frame.

Now, she wants the Chief Commissioners to assign the cases of adjudication on a monthly basis in his jurisdiction to the officers in personam and ensure that the officer to whom the case has been assigned disposes of the said case. In the event of his transfer out of that jurisdiction he should not be relieved till he has disposed of the said cases.

She further wants the Chief Commissioners to monitor the pendency of the adjudication cases on monthly basis by the 5th, for the cases of the previous month and report submitted to the Zonal Member clearly indicating the reasons for not disposal along with a copy to the J.S. (Review).

CBEC Instruction No.1/2015 in F.No.1080/09/DLA/Misc./15., Dated October 23, 2015

Relieve those transferred IRS officers - CBEC

WHILE the CBEC Member, in the above Instruction wants the Chief Commissioners not to relieve transferred officers who have not passed the adjudication orders, here is another instruction which wants all the transferred officers to be relieved immediately. CBEC has made transfers of Assistant Commissioner/Deputy Commissioner; ADC/JC; Commissioners and Principal Commissioners in its orders dated 09.06.2015, 17.06.2015,17.08.2015,20.08.2015 and 20.08.2015 (2 orders on that date).

It was found that many of the transferred officers were not relieved. Recently the Board issued an order that all the transferred officers (except those stayed by courts) are deemed to have been relieved on 30.09.2015. In spite of this, Board finds that some officers have still not joined their new places of posting.

Now, Board wants all the cadre controlling officers to ensure that all the transferred officers are relieved immediately.

What happened to the deemed relieving on 30th September 2015?

Board wants a compliance report today. All the best.

CBEC F.No.A.22011/09/2015-Ad(Pt.)., Dated October 26, 2015

Huge Fire at Jordan Customs as Seized Containers explode

EIGHT persons were killed and 12 injured yesterday at the Jordan Customs Department (JCD) yards in Amman as fire erupted after two containers of fireworks exploded. Several vehicles were also damaged. The containers were seized by customs officers several weeks ago and were stored at the yards for being re-exported to Nigeria.

https://www.youtube.com/watch?v=cv_3cDATOWs

Until Tomorrow with more DDT

Have a nice day.

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