Hello...
One of my clients receives liquidated damages from contractors for non completion of work as per the agreement. Will such receipt liable to Service Tax. In my opinion it should not be. Still i want your opinions?
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Liquidated damages
Replies (1)
Any amount of demurrage charged is liable to service tax. Also, any amount paid for not doing anything also is considered as service. You should look into the matter once again in the light of the amended Service tax Rule along with the definition of service. Hope it is clear to you that it will be liable to service tax.
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