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Service tax

ANAND DHYANI (Tax Consultant) (48 Points)

08 July 2012

Dear Learned Sir/Madam

we have a rental permises with agreement for electricity consumption @ 12/ per unit. and our landlord charged every month as per actual unit consumed including service tax 10.30%. Pls help : service tax is applicable on this type of expenses or not.

Regards

Anand Dhyani

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3 Replies

Rohan (Consultant) (91 Points)
Replied 09 July 2012

Hello, What u have as a Rent agreement, is not a actual expense that u are incurring. It's a utility you're using on for a rent. Therefore, the said activity shall b considered as Renting of utility. Scenario would change if u pay the bill on your own and pay the difference amount to lessor. In this case service tax shall be paid only on the rent amount and not the gross. Above suggestion is without any prejudice and subject. agreement you've entered.

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ANAND DHYANI (Tax Consultant) (48 Points)
Replied 09 July 2012

Dear Sir

The para of rent agreement as follows:

"Whereas the first party has agree to provide complete power backup/generator set for the Second party eighter by outsourcing the job or make adequate arrangements and provide the same to second party @ 12/ per unit basis for which this hiring agreement has been signed between the first party and the second party"

On the basis of above agreement the landlord charged 12/- per unit. + service tax. Pls help : service tax is applicable or not.