Now he started purchasing ready made kit from other states for programming.
If he sell the kits in local and out state market after doing programming as per the requirements of the buyers which tax is applicable whether VAT & Service Tax or Excise ?
Please send me the calculation of the tax which ever is applicable..
23 November 2011
Dear friend , this is a case of work contract in which both service tax and VAT are applicable. VAT is applicable of materials utilized and you can get input credit and service tax is applicable on value added as labour or service provided.
In your case software is an intangible and not a goods as per the defination of sales tax, however when any software loaded on Compact Disk or any other physical substance and through which it transfers from one person to another person,it is a sale within the menaing of sale. Hence it is attracted to CST and Vat depending upon the nature of sales.
CAclubindia
