Suresh Kumar Bansal vs Union Of India & Ors. on 3 June, 2016

1. The Petitioners are individuals who have entered into separate

agreements with a builder (M/s Sethi Buildwell Pvt. Ltd. – hereafter ‘the

W.P.(C) Nos. 2235/2011 & 2971/2011 Page 1 of 43
builder’) to buy flats in a multi-storey group housing project named ―Sethi

Group – Max Royal‖ being developed by the builder in Sector 76, Noida,

Uttar Pradesh.

2. The builder has in addition to the consideration for the flats also

recovered service tax from the Petitioners, which is payable by him for

services in relation to construction of complex and on preferential location

charges.

3. The Petitioners are aggrieved by the levy of service tax on services

‘in relation to construction of complex’ as defined under Section 65

(105)(zzzh) of the Finance Act, 1994 (hereafter ‘the Act’) and inter alia

impugn the explanation to Section 65(105)(zzzh) of the Act (hereafter ‗the

impugned explanation’) introduced by virtue of Finance Act 2010 as being

ultra vires of the Constitution of India. The Petitioners also impugn Section

65(105)(zzzzu) of the Act which seeks to subject preferential location

charges charged by a builder to service tax. The Petitioners state that their

agreement with the builder is a composite contract for purchase of

immovable property and contend that in absence of specific provisions for

ascertaining the service component of the said agreement, the levy would

be beyond the legislative competence of the Parliament.

W.P.(C) Nos. 2235/2011 & 2971/2011 Page 2 of 43

Source: Indian Kanoon

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