I have booked a flat in Aug 2015 paying 10% and the remaining amount 90% can be availed as as home loan as per our discussion with the builder( verbal discussion). We then approached the lender (PNBHFL) as suggested by them for loan processing As per the agreement with builder, the remaining amount to be paid within 45 days from the date of booking. Bank informed me that they can finance 85% only and not 90% on Sept 29, 2015 well past the due date of Sept 26, 2015. I lost my 5k processing fee and then applied for home loan with HDFC. Now the builder has charged me interest @12% per annum for the delayed payment for 64 days from the due date and GST @18% on accrued interest. The delay was due to resubmitting all the docs to HDFC and processing from the beginning. my concern 1. Am I liable for the interest amount as the lender was suggested by builder itself and the bank informed me very late past the due date for additional 5% payment as they can finance only 85 %. 2. Is GST applicable on the interest amount as the delayed payment was done in 2015 itself. if yes, then whether 18% rate is justified as I am already paying the penalty for delay. Can the builder be charged for Anti-Profiteering u/s171 of GST Act. 3. The builder has given delay possession charges for 4 months only whereas OC (occupancy certificate) was obtained after 9 months. also Is GST applicable on the delay possession charges given by the builder. ? As a buyer, what can i do as per the law.
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1. The builder can claim interest as it was agreed by to make timely payments and same was your responsibility under agreement. Secondly.there might be no evidence builder referred the said bank to you.
2. GST on interest is applicable if interest amount to paid after GST came into force.
3. GST not applicable on delay compensation give by builder as buyer you can claim compensation for 5, more months as there was 9 months delay issue notice to builder.
1. when the builder charges you interest/penalty for late payment, neither is he selling you any goods or providing any services, thereby entitling him to levy GST @ 18%
2. Builder may be entitled to the penalty but how and under what provision he is charging GST on that amount - that you need to ask him to provide details of the relevant provision
3. builder may not agree to waive the penalty for late payment - even though it was a delay by the lender which the builder himself recommended you and fighting for that waive will be a task
4. the builder is liable to pay delay possession charges from the stipulated date mentioned in your registered agreement till the date of handover of possession with OC to you
5. GST is not applicable on the delay possession charges. By paying a penalty for late possession the builder is again not providing any service or selling any goods to you. Moreso in this case it is the builder who is making the payment and not you. So if there is any GST on such payment, it is the builder who has to pay and not you
1. If the conditions for agreement of sale states this then the builder has a right to invoke this clause, it is the loan for you and not for the builder hence you may have to bear the interest for the delay in payment.
2. The GST is not applicable for the past i.e., to the pre-GST era, if the builder is doing some mischief, you can rightly refuse to pay the same.
3. If the delay is due to the builder, then you may reuse to pay GST for the delay in payment since the builder caused the delay in procuring the OC.
