Our store is in one of mall and mall has sent a debit note to us of electricity charges. they had received a electricity bill without any service tax but when they are sending debit note to us in that they are charing service tax on it. so want to know whether it is correct or not, if yes pls give reason or any case or provisions.....thanks...
8 Replies
sivaram
(Asst Mgr-Taxation)
(6918 Points)
Replied 01 December 2009
not correct way of doing and it need not be for electricity and water.required only for rent and maintenance
Ameet
(L)
(1678 Points)
Replied 01 December 2009
There is service rendered on part of mall to you, hence no service tax should be charged.
Pragnesh
(AM - Taxation)
(1259 Points)
Replied 29 January 2010
Type of payment is only reimbursement of expenses. Hence no service tax will be applicable.
Madhukar N Hiregange
(Chartered Accountant)
(39034 Points)
Replied 29 January 2010
Electricity is goods and provision of electricity is presently not liable for service tax.
Pavan Jain S
(Chartered Accountant)
(1575 Points)
Replied 30 January 2010
In my opinion, your tennacy agreement with the mall has to be taken into consideration. If other utilities are part and parcel of the rent agreement, the mall is correct in collecting servicetax
Rohit Khaitan
(Learning from Life)
(127 Points)
Replied 01 February 2010
I think renting of immovable property is no more a service in reference of Service tax chargeablity. As per the decision held by the Delhi high court, it stands withdrawn retrospectively from the date it was declared chargeable...
but maintenance shall continue to be under ambit of service Tax under Maintenance or Repair Services..
Here service tax charged on electricity exp is worth questionable....
Madhukar N Hiregange
(Chartered Accountant)
(39034 Points)
Replied 01 February 2010
Renting of IP is questionable and we await the decision of the SC. But yes where you provide a service as inseparable part of a basket of services then the service which gives the essential service would be considered.
However electricity as I understand is charged on usage basis and the rates would be specifically set out. If set out not liable.
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