Charging of Service TAx on consumables

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sheetal maliye (Querist)
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31 August 2010 A company has entered into a contract with a Facility Manager for management of various facilities in its office. At the time of billing, it has come to notice of the company that the facility managers had used some consumables for providing services. These consumables were charged to the company on actual, however the invoices were not provided to the company. The facility managers charge service tax for the service provided which also includes the cost of consumables.

The query is whether service tax can be charged on consumables if they have been already subjected to VAT. Can the company save that much part of service tax as double taxation relief?

Awaiting your replies. Thanks.

Gagan Agarwal

Gagan Agarwal (Expert)
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31 August 2010 the facility manager needs to clearly bifurcate the bill into consideration for services and consumables.

On the services part, service tax needs to be charged and on the consumables part, applicable vat needs to be charged.

In this way double taxation can be avoided

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