Anurag Krishna (Chartered Accountant) (40 Points)
15 July 2009Dear all,
A company has engaged a transporter who is paid Rs. 1500 per day, a makes number of trips.
The company puts its case as "Service tax is deducted for payment to transporter in excess of Rs. 750 per trip and the transporter is making three or more trips daily hence we are not liable for deduction of service tax"
Please advice me whether the company should deduct service tax or not??
Madhukar N Hiregange
(Chartered Accountant)
(39034 Points)
Replied 15 July 2009
First of all there is no deduction of service tax as in case of IT.
In this case you have to examine whether the service provider is a GTO or a GTA. If GTO no liability.
Assuming liability the argument of 3 trips may not stand.
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