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vat to be paid or not.

arjav (article) (25 Points)

09 February 2010

one of my client is engaged in the buisness of both sales and service,

he accepts the service contract with parts, so on parts used in service contract on them VAT is to be paid or service tax.

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3 Replies

Shikha Bajaj (CA ) (433 Points)
Replied 09 February 2010

Billing pattern should be such that it separately mentions the amt. of goods & services provided. On goods part, Vat will be levied & on services amt., service tax will be levied.

Thanks

Shikha

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M P Singh (Service - Finance & Taxation) (180 Points)
Replied 09 February 2010

Hi ,

Agreed ..with the advice given by Ms. Shikha ....if you are unable to quantify the supply & service portion than it shall be treated as work contract and provisions of the releavant VAT act will be applicable .....

Thanks

Sachin Jain CA, CS, CWA (Job) (240 Points)
Replied 11 February 2010

DEAR M.P.,

TO EXTEND THE QUESTION IF NO SUCH BIFURCATION IS POSSIBLE, THEN WHAT WILL BE THE RATE OF WCT IN MAHARASHTRA? WILL ANY WCT BE DEDUCTED WHILE PAYMENT TO VENDOR?