Is the free services provided to the customers covered under any head of the sevice tax ? pls reply.......
pavithra doss (student) (234 Points)
25 November 2009Is the free services provided to the customers covered under any head of the sevice tax ? pls reply.......
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
pavithra doss
(student)
(234 Points)
Replied 26 November 2009
thanx a lot for your quick reply..........
The Harshit Aggarwal
(B.Com(H) ,CS Final)
(5278 Points)
Replied 26 November 2009
| Originally posted by :sivaram | ||
| " | thanks mohit valuable rply | " |
| 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
CA. SUDHARSAN K G
(Chartered Accountant)
(472 Points)
Replied 26 November 2009
Mam,
It is a Tax on Taxable services provided.
in the given case too views are available
a) If the Seller and Service Provider are Different, even free service to consumer service tax will prevail. (Eg. Vehicle Services in Showroom)
b) if the buyer and seller are same, then it is not taxable.
CAclubindia
