24 June 2011
Dear Sir, good evening! We are into crane hiring business. Last year, we rented out our crane to a subcontractor(on basis of work-order) for "loading of steel sheet coils in rail-wagons . The sub-contractor was given the job of loading & transportation of coils from the main contractor. Now, the sub contractor is saying that no service tax shall be paid to us, giving reason that no service tax is applicable in rail loading & unloading. And he has not paid us any service tax.
Sir, my questions are- whether is there any such exemption for service tax on loading & un-loading coils on rail ?
what steps should be taken by us so that we do not face any tax consequences in future?
Do we need to take any matter in writing from the sub- contractor? and if yes, what shall be the matter.
25 June 2011
You are liable to service tax. No way out. Your service is renting of cranes. It doenot matter what work your customer is carrying on with the cranes.