I have purchased a flat from a builder in Bangalore. which was under construction and entered in to an agreement with the builder on 17th July, 2011 and the same "Sale agreement" was registered on 4-Nov-2011.
While making agreement neither mentioned in the agreement nor informed by builder about service tax. In agreement in cost break up it is only mentioned about 4% VAT and parking charges , electricity charges etc. but no word about service tax. Now the building construction almost completed and in occupiable postion (Still some pending works, which doesn't create much inconvinance like Drinking water (Cauvery water) connection not yet given etc to live in, the lift provided is not up to the mark w.r.to quality and functionality). For the same, I have paid all the money as per agreement and a "SALE DEED" made and got registered on 23rd Oct, 2012 with the BBMP, based on the promise made by builder to finish the pending works due course of time and also occupied by self and now living there. But Builder is still not yet completed those pending works as promised in the agreement. when we ask him to finish those works, now he is asking us to "pay the service tax (Comes around Rs. 1.3 Lakhs) which I didn't collect that time. Unless untill you pay the service tax I will not finish the pending works".
When we asked the builder "regarding service tax we dont have any word in our agreement, now why you are asking that, We assumed that the base price is inclusive of taxes or levies which are not explicitly mentioned". But Builder replied "I forgot to mention about service tax, recently I have received a notice from the government to pay the service tax, so now I have to collect it from you people". FYKI, He already constructed 4 apartments (during 2009 - 2011), to say that he forgot to collect the service tax, Our apartment is the fift one.
I request you to advise on how to go about? Does he have right to ask the service tax now. (If requiered I am ready to share the SALE AGREEMENT" soft copy with members of the forum.
Please help us.
Thanks & Regrads