First of All Is this AMC means Anual Maintainence Contract ? If yes you are liable for Service Tax and Not Vat.
Second.If you are providing commodity along with your services you Bill these commodity seperately.
Third: If your product sale is below Rs 5 Lac in an accounting year you need not take a vat tin number and you will not charge the client the Vat
Finally: Weather Service Tax or Vat, Sett off is available in Both
Also please check the Limit for Service Tax, It is 10 Lacs, Before acheiving that limit you are not liable for Service Tax Either