expert opinion

This query is : Resolved

MOHAN JOSHI (Querist)
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18 June 2009 I joined gold quest by purchasing a single coin in liftime i e on 30/11/2001 and given two referrals one in dec 2001 and other in jan 2002 .this two persons were joined with my reference .my work ended on jan 2002 however i received income continusly .
2004-05 268500
2005-06 126500
2006-07 115000
2007-08 207000
2008 -09 253000

here i may once again add that i have done nothing after jan 2001 i stoped ref persons, even then the chain went on and i got income without my effort continuosly
year by year.now i have receved suimmons from service tax and they are asking me to pay around a half million .
I stronly belive that As I have not rendered any service after 2001 i am not liable for tax as for as 2004 to 2009 is concerned. I am ready to pay tax for 2001 -2002

I need expert opinion on the subject

CA Shailesh +91 9393926464

CA Shailesh +91 9393926464 (Expert)
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19 June 2009 In my opinion, the payments received by you from Gold Quest is in the nature of incentives/commission.

The company might have already deducted TDS amount from your Gross Commission and have allotted you the net amount.

Further, the company might have issued TDS Certificates to you.

This forms the basis for you to justify that you have received only Incentives from the company.

Further, your Gross Receipts is less than the basic exemption limit applicable to Small Service Providers. Hence, in my opinion, you are not liable to pay Service Tax