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VAT is a levy on sale of goods. For the purpose, it is usually the seller who would be held liable for payment of VAT. However, there are few exceptions created under the VAT provisions. As per Section 3(2) of KVAT Act 2003, in case there is a sale by an unregistered person to a registered dealer, then the tax shall be paid by such registered dealer who is a buyer of goods. Similarly exceptions are created with respect to collection and payment of tax especially in case of industrial...

VAT is a levy on sale of goods. For the purpose, it is usually the seller who would be held liable for payment of VAT. However, there are few exceptions created under the VAT provisions. As per Section 3(2) of KVAT Act 2003, in case there is a sale by an unregistered person to a registered dealer, then the tax shall be paid by such registered dealer who is a buyer of goods. Similarly exceptions are created with respect to collection and payment of tax especially in case of industrial canteen...

Renting/Hiring of Motor vehicles has mostly been an unorganized operating with limited vehicles (mostly owned) covering limited geographical area and very limited outlook to grow. However, outlook of this sector is now changing with tons of investment being infused by established Indian corporate and foreign investments. In a sector where change seems good and growth seems obvious it is the responsibility of the government to ensure that uncertain fiscal policies must not create unnecessary...

Under Service Tax law, there was ongoing litigation about the applicability of service tax levy on commission agency services by Indian services providers to foreign principals. The argument was that all services were provided by way of marketing/sales promotion to customers in India, consequently taxable in India. The issue was more or less settled over period of 2006-2014 that services were exports. A reversal in the entire concept has been made whereby Indian commission agents earning...

At the Outset, we would be examining the law as it stood prior to the introduction of the point of taxation rules, 2011. The service tax levy would be attracted at the time of provision of taxable services and crystallize at the time of receipt of the consideration either in full or in part. However where any advance was received for the service to be provided in future, the point of levy and crystallization of levy happened at a single point of time. This is because the taxable service...

Availment of credit based on unsigned invoice or printed signature on computers generated invoice has at times been an area of audit objections by departmental official during the audit, verification, investigation. The law was silent on the issuance of computerized invoice and taking of credit based on computerized invoice.  

Finance Act 2015 has provided specific provisions for issuance of digitally signed invoices and preservations of records in computerised form authenticated by...

The concept of adding the value of free goods or services supplied by customer used in manufacture of excisable goods is not new in Central Excise. The principle that VAT and service tax are mutually exclusive adds to the confusion. [Imagic Creative – 2008(9) STR 337 (SC)]  Section 67 emphasizing on the gross value of service has also undergone change in this Finance Act- 2015.

Valuation of services under service tax law has always been subject matter of interpretation and disputes. In...

The union budget increased the rate of service tax 12.36% to 14% wef 01.06.2015. The education cess and secondary higher education cess subsumed in the revised rate of Service Tax. The rate was increased to augment revenue and to prepare the tax payer for paying higher rate of tax in GST regime.

The emphasis of article is to bring out the clarity on rate of tax applicable for ongoing works. Before going further it is very interesting to note that past history on ‘applicable rate of...

New service tax rate of 14% is effective from June 1, 2015. This article is intended to provide you with insights of how to deal with change in rate and which scenarios old rate shall prevail and when a new rate has to be applied. Few of the practical questions posed could be as under: 

• What if invoice is issued before the change of rate but payment is received after the change in rate. Which rate needs to be applied? 
• What should be the rate applied in case service is provided...

"Service” has been defined as an activity between two persons. In normal course the principle of “mutuality” is applied and there can be no tax when one deals with oneself. However an exception has been created in the Service tax law for dealing with a branch outside India.  

The Place of Provision of Services Rules 2012 has deemed certain locations as the place of provision. This depends on the nature of activity. Where the place is outside India, no service tax is...