In Indus Motor Co. v. CCE, Bangalore (2008) 12 STT 112; (2008) 9 STR 18; (2007) 11 STJ 235 (Cestat, Bangalore) where authorized service station provided free services for vehicles sold by manufacturer and service tax was demanded for such free services, it was held that when a service was free, unless the revenue showed some evidence that assessee got reimbursement in some other guise, it would not be possible to confirm the demand which was based on assumptions and presumptions. Service tax can not be collected on the ground that such services are included in dealers margin by the manufacture. Thus no service tax applicable.
If service is provided by an authorised service station to a customer and the service provider receives the consideration for the services provided from the manufacturer. Service tax is liable on the amount received from the vehicle manufacturer for the purpose of servicing of vehicles.
SIVASIVA
(FCA, Future CA)
(4935 Points)
Replied 09 April 2011
What if no consideration is being received???
Pankaj Arora
(Learner)
(3134 Points)
Replied 09 April 2011
if manufacturer not giving consideration to authrozied dealer thaan if dealer's grosss receipt is more than 10lac than he have to register in service tax and start charging service tax from customer...
U S Sharma
(glidor@gmail.com)
(21063 Points)
Replied 09 April 2011
the question is related to "taxable services" if taxable services exceeds 10L then he is liable for payment of service tax. if the service is FREE, no direct or indirect commercial involvement, hence no service tax.
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