Service tax doubt

Hi divya

Tax amounted Rs. 47850 is correct and service tax will be calculated on Rs.9.5 Lacs.

Thanks and Regards

Suraj Pahuja

@  Suraj Pahuja:thank u so much for the reply  what is the exact reason for taking 9.5lacs instead of 10lacs??

Divya, ur observation is correct, service tax is to be calculated on 10L.

Rs. 50000 will be deducted 4m d service tax liability arising thereon.....

Plz correct me if m wrng

d same can b verified 4m d following xample (wid notification no.)

Cess is payable under section 3 of Research and Development Cess Act, 1986, on transfer of technology. If such cess is payable, the consulting engineer will be granted exemption from service tax to the extent of cess paid - Notification No. 18/2002-ST dated 16-12-2002. Thus, if value of service is100, tax payable is10 and cess paid is3, net service tax actually payable will be7.

@ ca sumith grover  : thank u so much for your response...ya i have gone through  that notification and because of that my doubt was confirmed...so i thought of posting it for disscussion..according to that notification it was said that cess can be deducted from service tax liabilty but it was nowhere mentioned that amount of service tax is to calculated after deducting cess amount ...but in the solution it was not like that and the funniest thing is the problem is mentioned immediately after the notification in the book..

friends this is just my view correct me if i m wrong and if the problem is correct please let me know the exact reason or logic for that solution...