Taxes on window display

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

10 April 2014 my firm has get into agreemnet for hiring the place for window display . is it attract the vat or service tax?
or any other applicable tax ?

Shudhanshu Agrawal

Shudhanshu Agrawal (Expert)
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10 April 2014 Please elaborate the nature of agreement a bit more so that it is easily understandable.

Querist : Anonymous

Querist : Anonymous (Querist)

11 April 2014 it AGREEMENT MEntion the payment detail for window display advertising of one of agency for one month of rs 78000/- for specification size .

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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26 July 2025 Based on your clarification, here's how **taxation on window display** works:

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### 🔍 Nature of Transaction:

Your firm has entered into an agreement to **hire space for window display advertising** — essentially, **renting advertising space for display purposes**.

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### ✅ Applicable Tax: **Service Tax** (pre-GST era context, i.e., before 1 July 2017)

Since your example is from **April 2014**, it falls under **Service Tax regime**, not GST.

#### Under the Service Tax law (Finance Act, 1994):

* **Renting of space for advertising** (like hoardings, shop windows, panels, etc.) is **classified as a taxable service**.
* **Applicable service**: "Selling of space or time slots for advertisements" – Section 65(105)(zzzm) (prior to negative list).
* After the **Negative List regime (from July 2012)**, **sale of space for advertisements other than in print media** was taxable.

💡 **Your window display qualifies as taxable**, since it is not in print media (like newspaper or magazine).

#### Therefore:

* **Service Tax is applicable** on ₹78,000 (as per 2014 rates, i.e., @12.36%).
* **VAT is NOT applicable**, because there's **no sale of goods** involved, only renting of space (a service).

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### 📌 Summary (as of FY 2014–15):

| Tax Type | Applicability | Remarks |
| --------------- | -------------- | ---------------------------------------------------------------- |
| **Service Tax** | ✅ Yes (12.36%) | Taxable under "sale of space for advertisement (non-print)" |
| **VAT** | ❌ No | No sale of goods involved |
| **TDS** | ✅ Possibly | TDS under sec 194C (contract) or 194I (rent), depending on terms |

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### 👉 Post-GST Note (for future reference):

After **1 July 2017**, under GST:

* Sale of space for advertisement (excluding print) attracts **18% GST**.
* Still taxable under **supply of service**.

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Let me know if you want a **draft tax invoice format** or TDS treatment clarified too.

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