Service tax to be charged on d2h purchase & recharge

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

29 April 2014 Our company is registered both in VAT and Service Tax Department. Our company purchases the Digital TV set and sells the same to the customer. So whether Service tax is to be charged on sells of TV set.

Also, we sell the recharge coupon on Digital TV. Whether service tax is to be charged on the inclusive amount?

Please clarify.

KUMAR trp707@gmail.com

KUMAR trp707@gmail.com (Expert)
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01 May 2014 ONLY UR DTH EQUIPMENT INSTALLATION & REPAIRS FEE COLLECT FROM CUSTOMERS THAT AMOUNT CAN CHARGED UNDER BAS IN STAX.

Y WILL RISE A BILL FOR THE MONTH OF APRIL 2014 WE ARE INSTALLED 100 NOS DTH BOXE SO ASK INSTALATION FEE

PER DTH INSTALATION FEE RS 400.00/-
S TAX ON 12.36% ON (400/-) 44.94/-
EACH BOX TOTAL 449.44/-
MNC CAN GIVE INSTALLATION FEE + S TAX.
MNC CAN TAKE CREDIT ON PAID S TAX AMOUNT

Querist : Anonymous

Querist : Anonymous (Querist)

09 May 2014 Sir, you are not getting my query, We only sell Set top Box of a company. So whether we are liable to charge VAT or Service tax on Sales of Set Top Box? Pls reply.

Also, we don't undertake the installation of the same, whenever we sell the Set Top Box, we log a call with the company and the concerned company sends their executive for installation of the same.

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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25 July 2025 Got it! Here's the clarification for your queries on **D2H (Direct-to-Home) Set Top Boxes and recharge sales**:

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### 1. **Sale of Set Top Box (DTH Equipment):**

* **Is Service Tax applicable?**
No. Sale of goods (like Set Top Boxes or Digital TV sets) is a **sale of goods transaction**, not a service.
**Hence, Service Tax is NOT applicable** on the sale of Set Top Boxes.

* **Is VAT applicable?**
Yes. Sale of Set Top Boxes is **subject to VAT or GST (depending on your state and time period)**, because it’s a sale of tangible goods.

* **What about installation?**
Since you **do not provide installation service** yourself, and installation is done by the DTH company’s own executive, you are not providing a taxable service here.

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### 2. **Sale of Recharge Coupons / Recharge Amounts:**

* **Is Service Tax applicable?**
Recharge amounts for DTH services are considered **services**. The DTH operator (service provider) is liable to pay Service Tax on the recharge amount (which is the actual service).

* **Are you liable to pay Service Tax on recharge coupons sold by you?**
No, if you are merely **reselling recharge coupons or vouchers without providing the service**, you are treated as a **reseller** or **distributor**.
The **Service Tax liability lies with the DTH service provider**, not with you.

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### **Summary:**

| Transaction | Service Tax | VAT/GST |
| -------------------------------------- | ------------------------------ | ---------------- |
| Sale of Set Top Box (equipment) | No | Yes (VAT or GST) |
| Sale of recharge coupons (resale only) | No (liability on DTH operator) | No |

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### Important Notes:

* If you **provide any additional services** like installation, activation, or value-added services yourself, you may be liable to pay service tax on those service components.
* Keep proper documentation to show that installation is done by the DTH company to avoid any confusion.

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If you want, I can help you draft an official clarification note or a FAQ document for your company’s accounting and tax team. Would you like that?

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