11 June 2009
We entered contract with ware house service provider for providing space and insure the goods.The service provider of warehouse facilities is charging service tax on insurance facility also(Service provider made all arrangements for the insurance.) my doubt is the insurance chareges(on which service tax already collected by insurance company) is subject to service tax or not?
14 June 2009
The warehouse service provider is providing you only the warehousing service and not insurance service. May be the Insurance company is charging for the insurance of the goods kept in the warehouse and the appropriate service tax is collected by them. The warehouse service provider is collecting the insurance charges just as a pure agent and the amount should not form a part of the taxable service.