K.Kishore Babu (Profession) (24 Points)
16 March 2009Wheather service tax is levied on Settlement and Damages charges under Rental and immovable property. Settlement charges are paid towards breaking of contract before the agreement period. It is not a rent. Kindly clarify me on the above
What about the damages collected, does it fall into the Service tax perview.
So,It is free from VAT and service tax.
Rgds,
VK
SIDDHARTHA SANKAR ROY
(Government Servant -MOF)
(868 Points)
Replied 16 March 2009
Such charges wil not be a part of taxable value as these are some kind of disincentive for breaking the contract and not any consideration for provision of service viz., Renting of Immovable Property Service.
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