Ashwin (Consultant) (142 Points)
23 August 2012Hi All,
Our Company is having retail store and teaching school.because of teaching school since our income has exceeded Rs.10 lacs service tax was applicable.now we want to demerge retail store and teaching school.now,whether we have to again register for new company(teaching school) or we can use the existing one.
Please advise
CA. Subhash Dangi
(Chartered Accountant)
(1784 Points)
Replied 23 August 2012
with the result of demerger, two seperate entity will emerge and accordingly U need to register seperately with the change in name, address, nature of business or services as per provisions of Shops and Establishment Act and Service Act.
U S Sharma
(glidor@gmail.com)
(21056 Points)
Replied 23 August 2012
if the school goes registered with affilation to any state or central board or body for any of its carriculam then school will get exempted from service tax.
CA. ROHIT GUPTA
(Service)
(133 Points)
Replied 24 August 2012
Hi
Teaching school business is still exempt from service tax as its is kept in Negative list ans also turnover from teaching buisness will not get added up with your taxable services to ascertain the status of small scale service providers.
sagar k.raval
(C.A.)
(40 Points)
Replied 24 August 2012
CA. Subhash Dangi
(Chartered Accountant)
(1784 Points)
Replied 24 August 2012
As the cost of diesel is supplied by company, service tax on supply of goods i.e, diesel will not attract on the value of diesel.
ST is to be paid on Rs.24000/- which is payble to CAB operatior provided the amount of Rs.24000 twds Rental chgs of CAB and Rs.12000 for cost of diesel shown seperately in the Invoice or Bill.
CA. ROHIT GUPTA
(Service)
(133 Points)
Replied 24 August 2012
If a cab is hired even for one day for official purpose by the company and bill is raied on company, will it still be liable to service tax under reverse charge?
CA. Subhash Dangi
(Chartered Accountant)
(1784 Points)
Replied 24 August 2012
As long as contract beteen company and Rent -a - CAB operator exits, u are liable to service tax under Reverse machanism or otherwise not.
CA. ROHIT GUPTA
(Service)
(133 Points)
Replied 24 August 2012
Thanks Subhash
Can you please provide the relevant extracts of the provisions of Finance Act or any circular/notification in support of your reply?
I haven't come across anything which talks about Contract between cab operator & company.
CA. Subhash Dangi
(Chartered Accountant)
(1784 Points)
Replied 24 August 2012
Generally, Corporates, Big firms are hiring a CABS based on certain agreements i.e, contract.for regular arrangement for trasport or conveynnce facility to its employess on pool or other basis.
Refer the following link:
CA Sourabh Goenka
(Chartered Accountant)
(249 Points)
Replied 24 August 2012
Dear all,
Sry to interput you, but please read the defination of work contract give in service tax. This service does not come under the work contract service.
It 's a simple service provided by the cab driver, if it's total turnover exceeds rs. 10 lacs, then he will charge service tax on his bill, otherwise no service tax leviable..
No partial reverse mechanism applicable in this case, because it's not work contract service.
CA. ROHIT GUPTA
(Service)
(133 Points)
Replied 24 August 2012
Thanks Subhash
But you didn't read my query properly. My query was in relationto a cab is hired for one full day by a company for its employee , not talking about the coveyance facility provided for employees. Obviously in that case, company will be having contract with the service provider.
Thanks Sourabh
Yeah , it doesn't come under works contract service. It comes directly under rent a cab service which has come under partial reverse mechanism vide Notification No 30/2012 ST dated 20.06.2012. Also, just to correct you >>>>>>>>> the exemption of 10 lakhs not available to service receiver Proviso (ii) to Para 1 of the Notification No. 33/2012-ST dated 20-6-2012 that nothing in this notification shall apply to such value of taxable services in respect of which service tax shall be paid by such person and in such manner as specified under sub-section (2) of section 68 of the said Finance Act read with Service Tax Rules,1994. Thus threshold exemption of ` ten lakhs is not applicable in cases where the service receiver is liable to pay service tax under reverse charge method, as per provisions of section 68(2) read with rule 2(d) of Service Tax Rules
ACMA Obulirajan R
(M.Com, ACMA)
(1119 Points)
Replied 24 August 2012
Under reverse mechanism there is no threshold limit. Service receiver must pay the tax irrespective of the turnover.
CAclubindia
