Vat with service tax on same invoice


30 December 2012

There is an Invoice raised by the company on the sale of "Ms office 2010", on which they are charging Service tax@ 12.36% with Vat@5%, on the same invoice total amount.
The purchaser is taking input of both taxes paid, but the issue over their, is whether the seller can charge both taxes on the same invoice.
If Not, than plz refer the case for the same.
And the purchaser used to sale the same product again without any modification to client and on which he also charges both taxes.
At the time of filling returns, Purchaser used to show the figure of sale in Vat return and also in service tax return, which results, in non-matching of physical sale and filled return sale.
There is showing how the product being sold at higher rate by levying double taxes. Plz provide the suggestions which can be put up to solve the issue.

Madhukar N Hiregange (Expert)
31 December 2012

Since credit is being availed and the law unclear both maybe paid and credit availed.

saurabh (Querist)
31 December 2012

Yes the input is taken by the payer but the second part of query not considered, in which i asked that on resale of same product, the sales being shown on both returns that is Sales tax return and Service tax return due to chgng of both taxes, and because of which the Actual sales or service provided not match with Filled service provided or sales. And also,there should be some procedure,to plan for tax, ie why should not we consider it as sale of product to pay only VAT..

Arun Gulati (Expert)
01 January 2013

In view, after TCS case, it clear that software are goods then there is no question arises for the payment of services and re-sale of same is just like trading of goods and also does not attract service tax.

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