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pls help!!!

pavithra doss (student) (234 Points)

25 November 2009

Is the free services provided to the customers covered under any head of the sevice tax ? pls reply.......

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8 Replies

M.PORNIMA (Coimbatore) (278 Points)
Replied 25 November 2009

Dear frnd such a free service is not taxable at all.

MOHIT MAHAJAN (LCS, ACA) (2050 Points)
Replied 25 November 2009

No service tax on free services. If the value of service is zero then the tax on it say 10% will also be zero. This point has been stated in the case Bharti Cellular Ltd. vs CCE (2005)

You can study the case at following link, specially point 5

https://www.indiankanoon.org/doc/609523/

The circular of board referred in case can be read here -

The provision of free service is mentioned in point 5 (Year 2003 - Circular No.62/2003)

https://www.servicetax.gov.in/st-cirmainpg.htm

1 Like

pavithra doss (student) (234 Points)
Replied 26 November 2009

thanx a lot for your quick reply..........

sivaram (Asst Mgr-Taxation) (6918 Points)
Replied 26 November 2009

thanks mohit valuable rply

(Guest)

Service tax is payable only after realisation of consideration for service................................in case of free service there is not chances of realisation of consideration......................so no tax

The Harshit Aggarwal (B.Com(H) ,CS Final) (5278 Points)
Replied 26 November 2009

Originally posted by :sivaram
"	thanks mohit valuable rply	"

(Guest)

Originally posted by :Be my Friend
"	Service tax is payable only after realisation of consideration for service................................in case of free service there is not chances of realisation of consideration......................so no tax	"

Thats rite, n also check whether books r on cash or acc