20 May 2014
Dear Sir, we are planning to take an AMC(Comprehensive Basis)for Air Condition. Vendor has sent his quotation, in that quotation there is a doubt, please clarify, In the given Quotation, There is a Gross Bill Amount. After that he adds a 12.36 @ 70% Service Tax Then after adding of Service Tax and Gross Bill , he is charging VAT @ 8%. Now the my doubt whether is there any rules or circular or notification that explain that the VAT will be charged on Gross Bill + Service Tax, He has given me a some Notification, No.32/2007, Dated:22.05.2007 & 35/2012, Dated:20.06.2012. Now my second question shall I deduct WCT TDS on it or not. Please reply as it is required urgently.
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21 May 2014
Dear Shri Shrivastava On your first qs, the answer lies in judgment of Maharashtra SAles TAx Tribunal in the matter of Nikhil Comforts wherein it has been held that service tax element shall be exigible to VAT in a contract comprising both service & material element. Similar view has been taken by the Commissioner of Sales Tax in Sujata Printers. Though the point is debatable it would have to be litigated. Till then VAT is applicable on Service Tax element. On qs no 2 Section 31 of MVAT Act lays down that TDS has to made by specified persons @ 2% from a RD or 5% from URD dealer. If you are in doubt in view of some peculiarities of the transaction then you may apply to JC VAT Administration to get a no TDS certificate. Till then you will have to make the TDS & deposit it in the treasury. Amit Sheode Cost Accountant Ex- DY Commissioner Sales Tax Maharashtra 9967657138
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