26 August 2010
RESPECTED SIR.... ONE OF THE CONTRACTOR GET A CONTRACT FOR MAN POWER SUPPLY IN A FACTORY.FROM NOV 2007 ONWARDS. & T/O FOR 2007-08 IS ABOUT 5,00,000/- & FY 2008-09 FROM APR-08 TO SEP-08 HIS TURN OVER IS NEAR ABOUT 8,00,000/- & IN THE MONTH OF OCT-08 HE APPLIED FOR SERVICE TAX REGISTRATION & GET THE STC NO .. FROM OCT-08 ONWARDS HE HAS PAID THE SERVICE TAX ON THE AMOUNT COLLECTION. WHILE ENGAGING IN CONTRACT WITH FACTORY AN AGREEMENT HAS BEEN EXECUTED BETWEEN THE CONTRACTOR & THE FACTORY... IN THE AGREEMENT ONE CONDITION IS THAT STATUTORY TAX AS APPLICABLE...
SO MY QUERY IS THAT.. ON WHICH AMOUNT SERVICE TAX IS APPLICABLE... 1.AMOUNT COLLECTED AFTER CROSSING THE T/O LIMIT .... 2. FROM THE BEGINING OF THE YEAR (BEFORE CROSSING THE T/O LIMIT BECAUSE IN AGREEMENT ONE CONDITION IS THAT STATUTORY TAX AS APPLICABLE...)...
28 August 2010
first of all. initially exemption is given for the specified amount prescribed in a Financial year, say this year it is ten lakhs. then no service tax is payable upto value of taxable service of that amount i.e 10lakhs. suppose in a particular month the value is near crossing 10 lakhs, get your self registered and start paying service tax from the amount above ten lakhs. next year, you will have to apy service tax right from rs. 1 charged for providing taxable service and ther will be no exemption. in your case, you started providing services from the year 2007. i think the exempted value in that year was 8 lakhs. no need to get registration. next year again your exemption will be Rs. 8 lakhs.when you crossed the exemption you got the registration and started payin tax. that is also correct. there will be no exemption for the financial year 2009-10. you can not collect the service tax if it is not applicable. and if you collect, then deposit it in the C.Govt. account. it is mandatory. hope it is clear.
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