TMI BlogService Tax (Determination of Value) Rules, 2006X X X X Extracts X X X X X X X X Extracts X X X X ..... "Act" means the Finance Act, 1994 (32 of 1994); "section" means the section of the Act; "value" shall have the meaning assigned to it in section 67; words and expressions used in these rules and not defined but defined in the Act shall have the meaning respectively assigned to them in the Act. 3. Manner of determination of value.- Subject to the provisions of section 67, the value of taxable service, where the consideration received is not wholly or partly consisting of money, shall be determined by the service provider in the following manner:- (a) the value of such taxable service shall be equivalent to the gross amount charged by the service provider to provide similar service to any other person in the ordina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded and shall be included in the value for the purpose of charging service tax on the said service. (2) Subject to the provisions of sub-rule (1), the expenditure or costs incurred by the service provider as a pure agent of the recipient of service, shall be excluded from the value of the taxable service if all the following conditions are satisfied, namely:- the service provider acts as a pure agent of the recipient of service when he makes payment to third party for the goods or services procured; the recipient of service receives and uses the goods or services so procured by the service provider in his capacity as pure agent of the recipient of service; the recipient of service is liable to make payment to the third part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s immaterial that the details of individual components of the total consideration is indicated separately in the invoice. Illustration 1 .- X contracts with Y, a real estate agent to sell his house and thereupon Y gives an advertisement in television. Y billed X including charges for Television advertisement and paid service tax on the total consideration billed. In such a case, consideration for the service provided is what X pays to Y. Y does not act as an agent behalf of X when obtaining the television advertisement even if the cost of television advertisement is mentioned separately in the invoice issued by X. Advertising service is an input service for the estate agent in order to enable or facilitate him to perform his services ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tour. At the end of the tour, the chauffeur returns the balance of the amount with a statement of his expenses and the relevant bills. Company X charges these amounts from the recipients of service. The cost incurred by the chauffeur and billed to the recipient of service constitutes part of gross amount charged for the provision of services by the company X. 6. Cases in which the commission, costs, etc., will be included or excluded.- (1) Subject to the provisions of section 67 , the value of the taxable services shall include - the commission or brokerage charged by a broker on the sale or purchase of securities including the commission or brokerage paid by the stock-broker to any sub-broker; the adjustments made by the tel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... FAX) or telegraph or telex or for leased circuit; the airfare collected by air travel agent in respect of service provided by him; the rail fare collected by air travel agent in respect of service provided by him; and interest on loans. 7. Actual consideration to be the value of taxable service provided from outside India.- (1) The value of taxable service received under the provisions of section 66A , shall be such amount as is equal to the actual consideration charged for the services provided or to be provided. (2) Notwithstanding anything contained in sub-rule (1), the value of taxable services specified in clause (ii) of rule 3 of Taxation of Services (Provided from Outside India and Received in India) Rules, 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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