Vat & service tax on motor vehicle service

Parthraj Parmar (B.Com ARTICLE CA FINAL )   (63 Points)

17 December 2012  

Dear All,

I am conducting an audit of motor vehicle authorised service station, which is registered under composition scheme at 8 % and is also registered under Service Tax, But when they bill customer on Body Paint (i.e when car is painted and repaired) they levy both VAT and Service Tax I.e on 80 % of Body Paint Value Vat @ 8 % and on 20 % of body paint value service tax @ 12.36%.

Request you to please guide weather it is correct or not ? If its wrong what is the correct way ?