Sri Deepthi.S (CA Final) (32 Points)
22 December 2010For a C&F Agent,the expenditure like Steamer agent charges will be incurred by them on behalf of the client.This expenditure will be reimbursed by the agent along with his service charges.
The Steamer agent charges include the Service tax. Can that S Tax be claimed as S Tax Input by the C&F Agent? (Why I am confused is this expenditure is reimbursable one).
Pradeep Kamath
(Chartered Accountant)
(134 Points)
Replied 22 December 2010
Hi Deepti,
Rule 5 of the Service Tax (Determination of value) Rules, 2006 provides for inclusion in or exclusion from value, of certain expenditure or costs. If in the given case, if all the conditions under subrule (2) of the said rule is satisfied, the said charges (like steamer agent's charges) is to be excluded. Once the charges are excluded from the value, input credit cannot be claimed by the C&F Agent on such charges, but can be claimed by the client.
Regards,
Pradeep Kamath.
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