05 February 2016
Unlike VAT which is chargeable on the full value of Invoice, Service Tax is leviable on the value of service rendered. The Valuation of Services Rules, specifically excludes any tax, duty or cess levied by Government and local bodies from valuation. Till 1st April 2015, reimbursement of expenses was also included, but no longer. Only expenses paid to pure agents is not subject to service tax. Since Octroi is a levy by a local body, it is not part of service rendered nor is it subject to levy of service tax.
CAclubindia
