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Servicr Tax

jyoti (ACCOUNTANT) (201 Points)

05 January 2011

is there any provision that one can charge VAT on service provided....

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4 Replies

Prakash (Professional) (211 Points)
Replied 05 January 2011

NO.

Servise Tax is charged on service provided or to be provided, whereas VAT is charged on Sale of Goods. Both the transactions are different and mutually exclusively. VAT in NO case .

PS case Law

The Supreme Court has upheld the decision of the Andhra Pradesh High Court in the L&T case.

The Andhra Pradesh Commercial Tax Authorities had demanded VAT from the main contractor on the value sub contracts. The sub contractors were registered dealers and had paid VAT on the value of sub contracts executed by them. The plea of the main contractor that this will result in double taxation was not accepted by the Authorities. The Andhra Pradesh High Court vide its decision dated 12 Oct 2006 upheld the plea of the main contractor.

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U S Sharma (glidor@gmail.com) (21063 Points)
Replied 05 January 2011

cascading effects are there in certain areas like catering and works contract, where service tax + vat both are applicable,

CA. Praveen Gupta (CA ) (346 Points)
Replied 05 January 2011

You may pay only one thing either VAT or Service Tax

Anand (Asstt Accounts Manager) (25 Points)
Replied 06 January 2011

Yes, Service Tax and VAT are applicable at the same time in certain cases where Goods and service both are included and price is not segrgated for each component. Like in Software license with support charges -includes both service tax and VAT. Service Tax is charged first on the given price and VAT is charged on (Price + Service Tax amount)