Alex Sharma (CA & ICWA Final student; CS & CFA completed) (194 Points)
08 March 2010
Can u pls explain the practical application of Notification No. 12/2003 ST??
Ideally with a small numerical example.
i am confused with it.
tks
CA Pranjal Joshi
(CA)
(331 Points)
Replied 08 March 2010
Hi,
Service tax is tax on services. Therefore by virtue of this notification, if any goods or material is also sold along with the rendering of service, then no service tax shall be leviable on the value of goods so sold.
Alex Sharma
(CA & ICWA Final student; CS & CFA completed)
(194 Points)
Replied 08 March 2010
can u explain with a numerical example...
i am not able to understand the concept of abatement....
is it connected to this?
akr
(Partner)
(33 Points)
Replied 09 March 2010
Alex in case of work contract u have two option.
Pay ST @ 4% on total Contract Value (In that case cenvat is not available on input i.e. excise duty paid on input used bt you can take cenvat of input services and CG.
Pay ST @ 10% on services only and take credit of all things
Madhukar N Hiregange
(Chartered Accountant)
(39034 Points)
Replied 10 March 2010
In works contract service there are several options for valuation as under:
1. Compostion @ 4.12% [ on gross amount]
2. Payment on gross amount @ 10.3% [ avail credit of inputs, input services + capital goods]
3. Not 12/03. A. Paying state VAT on say 70% claiming deduction of 30% as labour. In this case pay ST on 30% claiming 70% is cost of goods sold.
B. Calculate the entire goods transferred in the WC and claim that amount say 63% as deduction and pay ST on 37%.[ this is based on the decision of Shilpa colour labs and others which state that on the value of goods transferred ST should ntobe charged.
PRADEEP MULANI
(Partner in MULANI BHANSARI & SHAH )
(142 Points)
Replied 07 December 2012
Dear Madhukar N Hiregangeji,
I just wish to know can a person avail the benefit of Notification No.12/2003 & Notification No. 06/2005 simultaneoulsly?
Many Service Providers are confused & are also getting Show Cause Notice which are actually a small service providers but by reason of such contract they are facing difficulties from the side of Department?
Please help if you are having any decisions or justifications if one can avail the benefits of both the Notifications.
Awaiting your reply..
CAclubindia
