• Service tax & gst refund against cancellation of flat booked by us .

I have booked flat in Mumbai I have paid approx 5 Lakh Service & around 15 Lakhs GST on Payments made by us to Builder .TOTAL 20 LAKHS .
 Service Tax was paid around june 2017 . GST was paid around March 2018 .
I want to Cancel the Flat so i would like to know whether i shall get Refund of Service Tax & GST Paid by us against Flat .What is Procedure for Refund & approx how much time it takes for Refund .
PAWAN SUREKA ( [deleted] )
Asked 6 years ago in Taxation

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11 Answers

For service tax there is no return you can get gst tax benefits by applying to new purchase property. 

Ganesh Kadam
Advocate, Pune
13008 Answers
267 Consultations

The Maharashtra state government has amended section 48 (pertaining to property sales) of the Bombay Stamp Act, 1958, to allow flat buyers to get stamp duty refunded up to two years after the cancellation of the agreement with the builder

 

 

2)

The application of refund of stamp duty can be made within 2 years from the date of execution or the said agreements for sale is cancelled by separate deed of cancellation, by recording the facts for cancellation on the ground of dispute such as (inadequate finance, financial dispute in terms of agreed consideration, suppression of any material fact or dispute regarding the property, etc) executed by both the parties and register the same can apply for relief under section 48 of Bombay Stamp Act, 1958.

 

3) you can get refund of stamp duty paid by you of Rs 22 lakhs 

 

 

 

 

Ajay Sethi
Advocate, Mumbai
99790 Answers
8147 Consultations

Builders will have to refund GSTpaid by home buyers in case he cancels the flat booked in the last fiscal and will be allowed to avail credit adjustment for such refunds, the tax department has said.

 

2) developer will be able to issue a 'Credit Note' to the buyer as per provisions of Section 34 in case of change in price or cancellation of booking.

"Developer shall be able to take adjustment of tax paid in respect of the amount of such Credit Note,

Ajay Sethi
Advocate, Mumbai
99790 Answers
8147 Consultations

Yes as per the new tax regime applicable from 1st April 2019 the gst paid will repaid in form of credit note to buyers and will be adjusted in their tax liability by builders

Prashant Nayak
Advocate, Mumbai
34526 Answers
249 Consultations

You are fully entitled to get refund of gst and stamp duty on cancellation of flat. 

Builder to issue you credit note 34 to you along with the refund. Claim it from the builder. Do not make unnecessary delay. 

Apply to registry office for refund of stamp duty on cancellation of the deed. 

You will get all such refunds. 

 

Kallol Majumdar
Advocate, Kolkata
2837 Answers
14 Consultations

1. on cancellation, builder will not refund the ST and GST since he must have already paid that to the government

2. so you will have to execute a cancellation deed with the builder and register it

3. submit the registered cancellation deed to the sales tax authority and apply for refund of ST and GST

4. Similarly the stamp duty will be paid to the government treasury and using the registered cancellation deed you will have to apply to the collector of stamps for stamp duty refund - i guess the procedure i had already described in a previous question of yours

Yusuf Rampurawala
Advocate, Mumbai
7900 Answers
79 Consultations

Stamp duty must be paid on ATS, if booking is cancelled due to fault of builder than can recover from builder through consumer court/RERA. Otherwise not.

And Builders must refund GST in case buyers cancel flats.

Yogendra Singh Rajawat
Advocate, Jaipur
23082 Answers
31 Consultations

The service tax paid on such cancelled flats neither can be adjusted against the consequent liability under GST nor the taxes paid can be availed as credit in GST regime. As the taxes paid are refunded to the customer and the ultimate tax burden is on the builder, the only option available to the builder is to apply for refund of the taxes paid on such cancelled flat. 

 

 

Mohammed Mujeeb
Advocate, Hyderabad
19325 Answers
32 Consultations

Yes you can get refund of GST from GST department by submission of cancellation deed of builder. 

Yes you can get refund of stamp duty if you apply for refund to revenue department with in Two years of payment of stamp duty.

Mohit Kapoor
Advocate, Rohtak
10686 Answers
7 Consultations

Builders will have to refund GST paid by home buyers in case they cancel the flat booked in the last fiscal and will be allowed to avail credit adjustment for such refunds.

Developer will be able to issue a ‘Credit Note’ to the buyer as per provisions of Section 34 in case of change in price or cancellation of booking.

“Developer shall be able to take adjustment of tax paid in respect of the amount of such Credit Note

Giving example,  a developer who paid GST of Rs 1.20 lakh at the rate of 12 per cent in respect of a gross amount of booking of Rs 10 lakh before April 1, 2019, shall be entitled to take adjustment of tax of Rs 1.20 lakh upon cancellation of the said booking on or after April 1, 2019, against other liability of GST.

T Kalaiselvan
Advocate, Vellore
89992 Answers
2495 Consultations

A project registered under RERA has to register an agreement to sale if the amount of advance received is more than 10%. So, if you have paid an amount of more than 10% as booking amount, you should get the agreement to sale registered.

The buyer of the property can get a refund of 98% of the stamp duty, if an application is made for a refund of the stamp duty. With the refund application, you are required to attach the original agreement, as well as the original cancellation deed, with both the documents being registered.

 

T Kalaiselvan
Advocate, Vellore
89992 Answers
2495 Consultations

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