21 October 2011
A Co. ABCD Ltd. develop a mall and in mall some part was occupied by Food court containing 1000 seats and 12 Food Counter.
ABCD Ltd. made agreement with 12 organisation for running one food counter each in Food Court certain space was occupied by each shop and prepare particulars kind of foods and sold to customer and give computer software support.
Food Selling procedure is like below
1. Customer enter into shop and purchase Debit card of certain amount (i.e. Rs. 100, 200, 500 etc.) which is paid to cashier arranged by ABCD Ltd. 2. Customer goes to desired counter and purchased food from counter and swap card in machine situated in counter and in the end money remained in Debit card refunded to Customer by cashier of ABCD Ltd.
Accounting in the book of ABCD Ltd. 1. Net Cash collected from Customer everyday Cash Dr. 500 To. Debit Card Sale 500 2. Total Sale made during the day Debit Card Sale 500 To Sale 440 To Vat 60 3. Purchase Dr. 300 Vat Dr. 36 To. Certain Counter 336
4. Certain Counter Dr. 336 To. Cash 336
It is cleared from the above condition Rs. 140 is earned by ABCD Ltd each day
I want to ask about Service tax liability on above income of Rs. 140 each day, Service tax Liable or not
24 October 2011
query of abcd ltd. is that they are purchasing food from all 12 outlets and selling it to customer and paying vat on sale of food to customer
and difference in sale and purchase is income, as vat paid so no ques. Of s.tax
but acc. To me income is for giving place in mall to outlet so service tax should be charged on this income portion
CAclubindia
