Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: ACCOUNTING STANDARDS :: articles on VAT and GST in India :: list of goods taxed at 4% :: form 3cd :: Central Excise rule to resale the machines to a new company :: VAT Audit :: TAX RATES - GOODS TAXABLE @ 4% :: cpt :: ARTICLES ON INPUT TAX CREDIT IN VAT :: due date for vat payment :: empanelment :: TDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT RATES :: ACCOUNTING STANDARD
 
 
« Sales Tax »
 Sales tax staff protest against goods service tax council
 Income tax survey on city jeweller
 Service tax levy to weigh on upstream companies’ earnings
 5 pc tax on online sales awaits Cabinet approval
 Amendment to Additional Sales Tax Act unconstitutional: High Court
 Maharashtra will soon achieve Rs one lakh cr sales tax : CM Devendra Fadnavis
 CBEC chief bats for minimal exemptions for India Inc under GST
 Issuance of Free Sale & Commerce Certificate to Merchant Exporters
 Why model GST law does not give confidence to exporting community
 State governments tighten their grip on sales tax holidays
 Income tax dept charts plan to broaden national taxpayer base

Sales, service and tax
July, 25th 2013

A small correction is needed to Vivek Mishra's otherwise informative article "Service tax on restaurants and hotels not constitutional". Towards the end of the article Mr Mishra says, "The clause 29A was introduced, as it was felt necessary by the experts to declare those transactions as deemed sale of goods that could otherwise lead to a dilemma in classification between sale of goods and/or services." In fact, the need for the 46th amendment to the Constitution came up because of an apex court judgment in the matter of Northern India Caterers versus Lt Governor of Delhi (decided on September 7, 1978) wherein sale and supply of food in hotels and restaurants were held not as a sale because the basic definition of a sale, i.e. transfer of property, never takes place. In that judgment, English and American law on taxing food supplied by hotels and restaurants was discussed at length and, after doing so, a three-judge Bench declared, "Service of meals to the visitors in the restaurant is not taxable under the Sales Tax Act, 1941".

After this order, for many years restaurants and hotels didn't pay any sales tax. When many states brought this omission to the notice of the Union government on grounds that they were losing revenue , the 46th amendment was introduced, giving the definition "a tax on the supply, by way of or as part of any service..." so that our state governments could treat such transactions as a sale and collect sales/commercial tax (now known as the value added tax). There was no need to differentiate between sales and service, as Mr Mishra claims, because the concept of service tax had not been introduced till then. The service tax concept came in 1994.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
System Testing Solution Manual Software Testing Solutions Automation Software Testing Solutions System Workflow Testing System Manual Testing

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions