determination of head for taxability of service

This query is : Resolved

pankaj jain (Querist)
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07 April 2008 hello friends,
i want to ask whether my clients services should come under the head 'air travel booking agent' or 'business auxilary service'.
the nature of work of the client is as follows.

1.the clients promots the name of the airline to which he is associated.
2.he is linked up with some IATA agents in india to whom he sells the tickets of the airline.
3.The IATA agents sells tickets to ultimate customer and my client receives commission on such sale at a predetermined rate of commission.

if u want some more information on topic plz do ask freely.

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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08 April 2008 It has been clarified that only GSA/IATA agents who issue tickets directly and get commission from airlines are liable to pay service tax. Sub-agents or sub-sub-agents who are not getting commission from airlines as also not making out tickets directly from airlines are not required to collect service tax and get registration - CCE, New Delhi letter dated 27.8.97 - 97 ELT T7.
Tax is payable only on commission and other charges but relating to booking of passage for air travel. For example, if he provides service for procurement of passport, that service cannot be covered under this head.

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