CA Chintan Vyas (Chartered Accountant) (116 Points)
24 February 2010Whether the incentive discount earned from manufacturer to dealer is termed as commission so as to make it liable for service tax under business auxiliary services ??
Can anyone quote any connected case of this topic ??
Pinky Agarwal
(Chartered Accountant)
(426 Points)
Replied 18 April 2011
It is not liable to tax under "Business Auxiliary Service". As this is not a commission. In KERALA STATE STAMP VENDORS ASSOCIATION V. OFFICE OF ACCOUNTANT GENERAL(2006)150TAXMAN30(KER HC), it was held that discount granted on sale of stamp paper to licensed stamp vendor by treasury cannot be termed as "Commission or Brokerage". Stamp vendor is not agent of government - relying on Ahmedabad Stamp Vendors Association v. UOI(2002) Taxman 628= 257 ITR 202 (Guj HC)..
U S Sharma
(glidor@gmail.com)
(21063 Points)
Replied 19 April 2011
| Originally posted by : CA Chintan Vyas | ||
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Whether the incentive discount earned from manufacturer to dealer is termed as commission so as to make it liable for service tax under business auxiliary services ?? Can anyone quote any connected case of this topic ?? |
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as per excise valuation rules, the invoice is to be prepared at factory gate price, any discount / rebate after that is surely commission paid/ credited to dealer.
CAclubindia
