sevice tax payment

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17 April 2011 in business auxilary service which transactions we will be paid service tax

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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18 April 2011 The definition of business auxiliary service has been given under clause (19) of section 65. That is:

"business auxiliary service means any service in relation to, -

(i) promotion or marketing or sale of goods produced or provided by or belonging to the client; or

(ii) promotion or marketing of service provided by the client, or

(iii) any customer care service provided on behalf of the client; or

(iv) procurement of goods or services, which are inputs for the client, or

(v) production of goods on behalf of the client, or

(vi) provision of service on behalf of the client, or

(vii) a service incidental or auxiliary to any activity specified to sub-clauses (i) to (vi), such as billing, issue or collection or recovery of cheques, payments, maintenance of accounts and remittance, inventory management, evaluation or development of prospective customer or vendor, public relation services, management or supervision,

and includes services as a commission agent, but does not include any information technology service and any activity that amounts to "manufacture" within the meaning of clause (f) of section 2 of the Central Excise Act, 1944.

Explanation. -For the removal of doubts, it is hereby declared that for the purposes of this clause, "information technology service" means any service in relation to designing, developing or maintaining of computer software, or computerised data processing or system networking, or any other service primarily in relation to operation of computer systems.

The Finance (No. 2) Act, 2004, w.e.f. 10-9-2004 has changed the 'definition of 'business auxiliary service'. The scope of the 'business auxiliary service' has been widened to include services relating to procurement of inputs, production of goods (not amounting to manufacture) or provision of service on behalf of the client. However, activities amounting to "manufacture" are specifically excluded from the scope of service tax. Further, scope of incidental and auxiliary services has been made more specific and restricted to the services, which are incidental to the main services specified in sub-clauses (i) to (vi). Further, illustrative list Of incidental and auxiliary service has not only been redefined but also enlarged.

Querist : Anonymous

Querist : Anonymous (Querist)

14 June 2011 SIR
WE PURCHASED STOCK AND TAKEN INPUT BUT SAME STOCK SALE WE ARE GIVING FOC THERE IS NO COLLECTION OF VAT AM I CORRECT TO TAKE INPUT ON SAME PURCHASE STOCK

B.NAGENDRA VARA PRASAD

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