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TMI BlogService will be applied or not ??X X X X Extracts X X X X X X X X Extracts X X X X ..... Hi All, Need your guidelines if service tax will apply on DEBIT NOTE as per the below transaction or not. In the total transaction two companies naming it Y Z one dealer one transporter is involved Company Y selling a product 'A' which he is selling in negative price: means company Y gives money for buying that product from them, the dealer buys from company Y sell it to com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany Z and the transporter bills the dealer Below is the how the billing has happened Y Billing the dealer 10rs per ton for material sold. Dealer selling the material to Z at 10rs per ton same rate as bought. Dealer prepares a separate debit note to company Y of rs 2000/- per ton showing as quantity discount for purchase of the material. Dealer pays the transporter bill ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of rs 1200 per ton also pays service tax on the transporter bill amount. Now the question is: Dealer is already paying service tax on transporter bill, than does he also how to pay service tax on the DEBIT NOTE amount which he has debited to company Y ?? NOTE : Dealer has not charged service tax in the debit note to company Y Thank you in advance for the help. - Reply By KASTURI SET ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... HI - The Reply = Dear Querist, Dealer has got discount of ₹ 2000/- by way of debit note issued to 'Y'. Does the amount of Debit Note issued by dealer to Company 'Y' include transportation Charges ? What I think transportation charges are not part of debit note issued on account of discount. If my presumption is right, no service tax is applicable. Pl. confirm the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... factual position so that correct reply be posted. - Reply By Himansu Sha - The Reply = Question is very complicated. The debit note is in respect of sale of goods. No service component is here. S.tax leviability is not applicable. You can put the question in a simple manner - Reply By Ganeshan Kalyani - The Reply = I think querist want to ask whether the amount in debit note would tentamount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to commission and whether service tax is applicable on commission income. How can a dealer be doing the activity without any interest, without any income. However in present situation service component is missing hence no service tax liability. Thanks. - Reply By KASTURI SETHI - The Reply = I agree with both experts. Question has also not been properly drafted. I have read it thrice to underst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and what Querist wants to say. Anyhow Querist's purpose has been solved. - Reply By Jubin Desai - The Reply = Hi Kasturi Sethi ji, Himansu Sha ji Ganesh Kalyani ji. Sorry for complicating it, I just wanted to describe in detail also have the billing is done. In Short : Dealer buys a material from company Y at minus 2000rs per ton (means Y pays the dealer) dealer sells it to compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny Z at 10rs per ton the transportation cost 1200 per ton is paid by dealer also the service tax on transport bill amount. hope now it is simple to understand, my question was will dealer have to pay service tax on Debit Note amount ? Dear Kasturi Sethi : Yes transportation is not a part of debit note. Debit note to company 'Y' by dealer only includes 2000rs per ton as quantity di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scount for purchase of the material -*** mentioning it again Below is the how the billing has happened Y Billing the dealer 10rs per ton for material sold. Dealer selling the material to Z at 10rs per ton same rate as bought. Dealer prepares a separate debit note to company Y of rs 2000/- per ton showing as quantity discount for purchase of the material. Dealer pays the tran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sporter bill of rs 1200 per ton also pays service tax on the transporter bill amount. thanks for the guidelines Regards, Jubin - Reply By KASTURI SETHI - The Reply = 100 ℅ correct reply is possible only through a scrutiny of your books and accounts and other records. Better option is to engage an advocate, C.A or CMA. - Reply By Ganeshan Kalyani - The Reply = Yes i agree with Sri K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asturi Sir. You should consult a practising consultant whom you can approach personally and explain the situation to seek the solution. You can find such expert in TMI or nearby your area. - Service will be applied or not ?? - Query Started By: - Jubin Desai Dated:- 7-4-2017 Service Tax - Got 7 Replies - Service Tax - Discussion Forum - Knowledge Sharing, reply post by an expert, personal op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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