28 January 2014
Mr A is a proprietor of M/s B. He is purchasing a mini bus in his name and has only 1 bus. M/s B (Proprietory Concern) is giving this mini bus on hire to a Pvt. Ltd. Co.. Pvt. Ltd. Co. will use this mini bus for transportation of their employees from station to office. Is service tax applicable to M/s B? If yes, then under which service? Also is there any exemption from service tax, if an individual owns only 1 bus?
Yes, since this is not in the negative list, it is chargeable to ST.
However, it will come under the Reverse Charge Mechanism and thus, the receipient of service will be liable to pay the ST he satisfies the conditions of chargeability under RCM
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