Amount adjusted as compensation
This query is : Resolved
26 February 2009
Actually i provide amenities and against that we charge service tax, now at the time of termination of agreement client's security deposit has been forefitted by us.... now the amount received has been treated as income from other sources as per income tax act.......... now the question is whether this amount is subject to service tax..... in my view when we are not providing any service after the termination of agreement y we sud charge service tax....
ACTUALLY AMOUNT HAS BEEN FOREFITTED ON A/C OF COMPENSATION CHARGES.
ACTUALLY AMOUNT HAS BEEN FOREFITTED ON A/C OF COMPENSATION CHARGES.
26 February 2009
I do not have any authoritative information in my possession about the subject. However it appears to me that forfeiture of security deposit being for non-adherence of contractual obligations and not for providing any service, is NOT liable for service tax.
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