Devlopment of payment processing platform for e commerce com

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

02 January 2012 If a company develops a payment processing platform ( a software application) to enable an e commerce company for e payment options then

a) Is it liable for VAT? and if yes why?

b) Is it liable for Service tax and if yes why?

c) If the company provides its own software application for e payment to e commerce companies on license fees basis then whether it is covered for VAT or Service Tax?

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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04 January 2012 Mr Author,
After developing the software described by you if that company sells it to the user it becomes sale(which is generally the case).If that company 'lends' that software to be used by the user in his own computer/s by his own men it becomes leasing and tax is applicable as if it is a sale.If the company installs his computer and put his own operator to do the service by using such soft wre it becomes a hiring transaction and exempt from tax.
I do not hve deatails of Service tax pl.
MJK