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Service Tax on Xeroxing

Queries 1296 views 2 replies

One party give the service of printing of Xerox copies. The machine belongs to uthe Company . He is providing the paper and the service of Xeroxing and he is charging @ 48 paise per copy.Ink, catraiges,oiling & maintenance of the machine is done by that person only.

While billing the person who is giving the service of xeroxing  is charging VAT @ 5% on 75% of bill value and service tax @ 10.3% on 100% of bill value. Is this ok?

Can Service Tax & VAT be levied together? If yes then what will be the proportion of bill amount on which the service tax and VAT will be levied?

Kindly reply as it is urgent..

Thanks

Replies (2)

Xerox is a Works Contract.
So, both VAT and Service Tax are applicable.
VAT is leviable on the value of goods(Transfer of property in goods).
Service Tax is leviable on the labour component.
General Bifurcation is 75% Material and 25% Labour.
For leviablity, exemption of 10 lakhs to a small service provider will be available

Thanks.

Can you give me any Circular or notification reference or any case law related to it in order to get a detailed view of this case.


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