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service tax liability

10 June 2016

in proprietorship bus transport
I have a contract with clients for carry passengers from one point to another point. what is service tax liabilities.

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3 Replies

CA Saurabh Singh (Practising Chartered ) (974 Points)
Replied 10 June 2016

Hi Kapil,

The service which is mentioned by you would be cover under service tax ambit under head "Renting of Motor Vehicle".

In your case a bus has been covered under the definition of cab which means"any motor vehicle which is constructed or adapted to carry more than 12 passengers.

Henceyou are required to charge service tax on your bill @ 15% from 1st june 2016.

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CA Anant Tyagi (CA) (283 Points)
Replied 10 June 2016

Dear kapil

As per clause 23(b) of Mega Exemption Notification No. 25/2012 Following services are exempted –

Transport of passenger, with or without belongings by –

Non air-conditioned contract carriage other than radio taxi, for transportation of passengers, excluding tourism, conducted tour, charter or hire etc.

Stage carriage other than air-conditioned stage carriage.

In your case, you are entered into contract with clients for carry passenger from one point to another point i.e. Non AC contract carriage for the purpose other than tourism, tour and charter travel.

Hence, service tax shall not be applicable on your Bus service.

But if you are providing AC contract carriage then service tax shall be applicable on you.

karan jit singh (Consultant) (1299 Points)
Replied 11 June 2016

Originally posted by : kapil dev choudhary
	in proprietorship bus transportI have a contract with clients for carry passengers from one point to another point. what is service tax liabilities.