02 October 2009
Recently our transport contractor (we hire transport from them for the tour of our foriegn clients) billing us as per following example : -
Tour Package Cost = Rs. 60,000 Service Tax @ 4.12% Rs. 2472 Nett bill amount = Rs. 62472
Can we suggest our transporter to bill us as per follwing manner : -
Suppose they have a Margin on the total tpt cost is @ 10%
So they can bill us like :- Hiring Charges 6000.00 (10 % of Rs. 60000) Service Tax @ 4.12% = Rs. 247.00 Total bill amount = Rs. 6247.00 Charges of Fuel/Toll/Parking/State Taxes etc. = 54000.00 Gross Bill amount = Rs. 60247.00
The captioned suggestion means to avoid double taxation, as the transporters are already paying service tax on the fuel, parking, toll etc. then again they levy the service tax on their gross billing
you can not suggest your transporter as you narrated.
Here i am giving u 2 examples both are not cosidered as double taxation.
example:1 When a manufacturer sell any goods 1st he has to pay c.Excise duty ,E,Cess & S& Hecess @8.24% on the value of the goods and sales tax [either VAT or CST] on the consolidated price.
example:2 In a case of testing & certification service one Engg has visited Kerala from kolkata where his to & fro air fare is Rs.20,000/= and service charge RS.4,000/= he has to charges S.Tax @10.30% on 24,000/= not on Rs.4,000/=.
I think over this 2 example it is clear to you that your contractor is rightly charged you 4.12%.
CAclubindia
