04 April 2012
Trading activity is considered as exempted activity for service tax, however -
From financial year 2011-12 - for computation of service tax exemption turnover limit of 10 lacs - Trading activity figure is considered with service activity & service tax is applicable from the day the turnover figure (Trading + Service charges) crosses Rs.10 lacs. It is True ?
(As auditors from Excise dept.has raised the above point)
05 April 2012
No, yr statement is not correct.You have to go through the relevant notification No.6/2005 properly.amendment has included the activity of Trading under the definition of Exempted service for other reasons.The reason was that the people were doing mfg.as well aS TRADING activity and enjoying the benifit of cenvat credit in toto.To disallow them that part of credit it was done.But for 10 Lacs threshold limit you have not to consider the trading ,which is an exempt sevice,u have to include all taxables services only.CA.SAGAR MAL PAREEK,9824346469
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