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: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: form 3cd :: VAT RATES :: Central Excise rule to resale the machines to a new company :: list of goods taxed at 4% :: ACCOUNTING STANDARDS :: VAT Audit :: TAX RATES - GOODS TAXABLE @ 4% :: due date for vat payment :: cpt :: TDS :: articles on VAT and GST in India :: ACCOUNTING STANDARD :: empanelment :: ARTICLES ON INPUT TAX CREDIT IN VAT
 
 
Service Tax »
 All you want to know in 5 brief points
 GST loss to be reduced by slice of service tax
 Government encouraging self-registration for GST
 Spl assembly session on GST Bill on May 9
  Getting the trade to align with GST is a challenge
 Getting the trade to align with GST is a challenge
 With GST launch, race against time to avoid sales tax upheaval across India
 GST to rate taxpayers, businesses on payment record, make ratings public
 7 major benefits of Goods and Services Tax
 100 Opening GST Profiles- Indirect Taxation- ALL Industries
 New Opening Sr. Manager-Indirect Tax For A Leading Power Company

Gross amount charged for service tax
September, 09th 2010

Is the value of free supplies includable in the gross value for the purpose of charging service tax? Pravin Bagadia

As per notification no.1/2006-ST dated March 1, 2006, the contractor can charge service tax on 25% of the gross amount charged if the gross amount includes the value of land or charge service tax on 33% of the gross amount charged if the gross amount does not include value of land.

The gross amount charged includes the value of the goods and material supplied or provided or used for providing the service and hence the gross amount will have to include the value of the material used by you as well as the value of the free supplies.

In the case of Jaihind Projects Ltd versus commissioner of service tax, Ahmedabad, 2010 (18) STR 650 the brief facts are as under

The appellant, engaged in laying in of pipelines, is covered by Commercial or Industries Construction service, and availed abatement of 67% vide Notification No. 15/2004 and paid service tax on the balance amount excluding value of free supplies. The abatement was denied on the ground of non-inclusion of value of free supplies of pipes by the service recipient used in construction services. Penalty also was levied u/s.76 and u/s.78. The appellant contested that the value of free supplies is not includible in gross amount charged, as appellants have not charged anything for free supplies.

The CESTAT opined that the case was covered by Rule 3 of the service tax (determination of value rules), 2006 providing for valuation of services. The said rule provides that value of consideration would be the gross amount charged inclusive of monetary and non-monetary consideration and where such valuation is not possible, the gross amount charged would be money equivalent to consideration charged and in no case it would be less than the cost of provision of service.

It also states that proviso to the notification only explains when and how the benefit of this notification can be taken. The explanation in current case is only explaining actual meaning of gross amount charged and does not expand the scope of main operative part of notification. So, the value of free supplies is to be included in the gross amount charged.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Software Development Software Programming Software Engineering Custom Software Development Requirement Based Software Development Software Solutions Software Serv

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