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what will be threshold limit of 10 lacs?

Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 preetham asked about 3 years ago

I need someone valuable advise!! X-Principle Manufacturer Y-Jobworker X send material to Y for Job work, X is not registered in Central excise and service tax because of threshold limit, Y is registered in excise & service tax both then should y charge service tax or not on jobwork bill while y has also not crossed thershold limit of 10 lacs

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Lokesh commented over 1 year ago

Dear Preetham, Please note there is no any requirement to collect Service Tax on Services provided if the services provided seems to exceed a total of Rs. 10Lac during the FY. Here the services so provided are less than 10Lacs. Hence there is no meed to charge Service Tax. If the provider do so then he is required to pay the tax so collected to the Account of Govt. Apart from that in the above case the provisions of TDs also attracts under Section 194C. Feel free to ask questions about INDIRECT TAX here even on mail garglokesh92@yahoo.in On FB - fb.com/garglokesh92 Regards ! Lokesh Garg !

6 Answers
Open uri20170510 32134 1et5ppw?1494421765 abhishek answered about 3 years ago

Dear Pretham, No need to see details of Mr. X as service tax is charged irrespective of registration status of service receiver. Further, whether Mr. X will charge ST or not will depend on whether value of his services in preceding year was upto Rs. 10 lacs or not. If YES,Mr. Y will not charge ST on value of services provided upto Rs. 10 lac in current financial year.

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 swati CHAUHAN answered about 3 years ago

Where the processing undertaken by the job worker does not amount to manufacture, the said job worker could be liable to service tax. Service tax shall be payable when reaches to threshold limit

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 karishma answered about 3 years ago

Hi, According to service tax rules, 1.If Aggregate value of Taxable Services provided is **Less** than 10 lakh in Preceding Financial Year and in Current Financial year then No service tax to be paid. 2.If Aggregate value of Taxable Services provided is **Less** than 10 lakh in Preceding Financial Year and **More** than 10 lakh in Current Financial year then Service tax applicable after 10 lakh. 3.If Aggregate value of Taxable Services provided is **More** than 10 lakh in Preceding Financial Year and **Less** than 10 lakh in Current Financial year then Service tax applicable from Rs one ,No exemption available. In the above case it was given that Y has also not crossed thershold limit of 10 lacs so y does not need to charge service tax. Hope this helps you Thank You

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 Mahaboob Rahman answered about 3 years ago

Hai, Normally, the ‘person’ who provides the taxable service on receipt of service charges is responsible for paying the Service Tax to the Government (Sec.68 (1) of the Act). However, in the following situations, the receiver of the Services is responsible for the payment of Service tax : (i) Where taxable services are provided by foreign service providers with no establishment in India , the recipient of such services in India is liable to pay Service Tax,; (ii) For the services in relation to Insurance Auxiliary Service by an Insurance Agent , the Service Tax is to be paid by the Insurance Company (iii) For the taxable services provided by a Goods Transport Agency for transport of goods by road, the person who pays or is liable to pay freight is liable to pay Service Tax , if the consignor or consignee falls under any of the seven categories viz. (a) a factory (b) a company (c) a corporation (d) a society (e) a co-operative society (f) a registered dealer of excisable goods (g) a body corporate or a partnership firm (iv) For the taxable services provided by Mutual Fund Distributors in relation to distribution of Mutual Fund the Service Tax is to be paid by the Mutual Fund or the Asset Management Company receiving such service.

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Open uri20170510 32134 ng4pv?1494421709 SONIYA answered about 3 years ago

Liability to pay serice tax arises only if 1. If in the previous financial year the aggregate value of taxable services provided by you was less than Rs.10 lakh and in the present financial year the aggregate value of taxable services provided by you is also less than Rs.10 lakh. Then no need to pay service tax . 2. If in the previous financial year aggregate value of taxable services provided was less than 10 lakh but this year aggregate value of taxable services provided is more than 10 lakh them you start paying service tax after crossing the threshold of Rs 10 lakh. 3. If in the previous financial year aggregate value of taxable services provided was more than 10 lakh but this year aggregate value of taxable services provided is less than 10 lakh them you start paying service tax from rupee one. **Since Job worker Y has not crossed the threshold limit of 10 lakhs till now , so y should not charge service tax since liability to pay has not arise so why to collect.**

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 Prasanna Krishna answered about 3 years ago

Please clearly mention whether X- was a firm/ company or Proprietorship & also Job work means what work....

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