Which tax is applicable?

This query is : Resolved

Gaurang (Querist)
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23 November 2011 My Brother is I C Programmer.

Now he started purchasing ready made kit from other states for programming.

If he sell the kits in local and out state market after doing programming as per the requirements of the buyers which tax is applicable whether VAT & Service Tax or Excise ?

Please send me the calculation of the tax which ever is applicable..

Regards

Gaurang Gandhi

+ 91 9429060515

CS, Deepak Pratap Singh

CS, Deepak Pratap Singh (Expert)
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23 November 2011 Dear friend , this is a case of work contract in which both service tax and VAT are applicable. VAT is applicable of materials utilized and you can get input credit and service tax is applicable on value added as labour or service provided.

CA Mahesh Vekariya

CA Mahesh Vekariya (Expert)
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23 November 2011 I agree with Mr. Deepak Pratap

CA Mahesh

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CMA Nishad Patkar

CMA Nishad Patkar (Expert)
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23 November 2011 Dear Gaurang,

In your case software is an intangible and not a goods as per the defination of sales tax, however when any software loaded on Compact Disk or any other physical substance and through which it transfers from one person to another person,it is a sale within the menaing of sale. Hence it is attracted to CST and Vat depending upon the nature of sales.