(1)(a) Every builder shall be liable to pay tax on the capital value of the building or part of a building constructed by him and sold or leased for the first time on or after 1st April, 2011 at the rate of five percent.

(b) If any part or space of a building is leased for the first time on or after 1st April, 2011, then the entire building shall be deemed to have been leased for the first time on or after 1st April, 2011.

Explanation.- No tax under this section shall be levied in respect of the transactions which are in the nature of works contract and on which tax is payable under Section 9 as a works contractor.

(2)(a) Such value of land, as may be prescribed, assigned to the building shall be deducted from its market value of both land and building to determine its capital value.

(b) If the sale price of a building is more than its market value, then its sale price will be taken as its market value for the purpose of determining its capital value.

(3) Every builder liable to pay tax under sub-section (1) and who is not liable to pay tax under Section 9, shall get himself enrolled in such manner as may be prescribed.

(4) An enrolled builder and a registered dealer who is liable to pay tax under sub-section (1), in respect of goods specified in Schedule II other than those specified in Part III and Part-Ill A of the said Schedule purchased within the State of Madhya Pradesh from a registered dealer after payment to him input tax for consumption or use in the construction of buildings, shall claim or be allowed in such manner and within such period as may be prescribed, input tax rebate of the amount of such input tax:

Provided that an enrolled builder and a registered dealer who has consumed the goods purchased before 1st April, 2011 in the construction of a building upto or after 31st March, 2011 and the building so constructed is sold or leased on or after 1st April, 2011, shall be eligible to claim or be allowed input tax rebate in respect of such goods.

(4A) Notwithstanding anything to the contrary contained in sub-section (4), where a builder makes an application for grant of an enrolment certificate under subsection (3) after the prescribed period but before 30th June, 2013, he shall be eligible to claim or be allowed input tax rebate in accordance with the provisions of this section.

(5) No rebate under this section shall be claimed or be allowed in respect of the goods as the State Government may, by notification, specify:

Provided that the purchase value of goods, on which tax under the Act has been paid at the time of purchase and no input tax rebate is admissible on such purchase, shall be deducted from the capital value of the building.

(6) The rebate under sub-section (4) shall be adjusted towards the tax payable under sub-section (1).

(7) The provisions of this Act shall mutatis mutandis apply to a builder who is liable to pay tax under sub-section (1).