Hello everyone,
I have some query regarding the service tax exmpt to SEZ units.
But my issue is "I provide service to a company which is in SEZ. As they come under tax exempt i do not charge service tax to them. If the company is using the service or product for own then its fine, upto this point is clear.
Now what if the company of SEZ wants to bill for the same services (serv. tax free services provided by me) to client who is outside SEZ,
1) do they have to add servic tax in the bill ?
2) If they are taking service tax from the client, do they have to pay me the serv tax aswell ?
To clarify this situation, let me give example.
Company A : IT company
Company B: SEZ company
Company C : Outside SEZ
Company A sell license & services to Company B. He does not charge service tax as Company B is in SEZ. Now Company B wants to sell same services provided by Company A to Company C, (Company A does not have any problem). Does Company B has to add service tax in the bill for company C ? If Company B is taking service tax from Company C, then is it mandatory for the Company B to pay the service tax to Company A ?
this is kind of tricky situation we are strucked at.
CAclubindia
