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Bundle Supply - GST - Levy and Collection - GST

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..... a manner of determination of value of two services for the purpose of charging service tax is different. Two rules have been prescribed for determining the taxability of Bundle services First Rule - Services which are naturally bundled in the ordinary course of business The rule is - ‘If various elements of a bundled service are naturally bundled in the ordinary course of business, it shall be treated as provision of a single service which gives such bundle its essential character’ Illustrations - A hotel provides a 4-D/3-N package with the facility of breakfast. This is a natural bundling of services in the ordinary course of business. The service of hotel accommodation gives the bundle the essential character and would, there .....

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Bundle Supply - GST - Levy and Collection - GST

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..... ally bundled in the ordinary course of business, it shall be treated as provision of a service which attracts the highest amount of service tax.’ Illustrations - A house is given on rent one floor of which is to be used as residence and the other for housing a printing press. Such renting for two different purposes is not naturally bundled in the ordinary course of business. Therefore, if a single rent deed is executed it will be treated as a service comprising entirely of such service which attracts highest liability of service tax. In this case renting for use as residence is a negative list service while renting for non-residence use is chargeable to tax. Since the latter category attracts highest liability of service tax amongst t .....

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Bundle Supply - GST - Levy and Collection - GST

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..... day. Such service is an ancillary service to the provision of hotel accommodation and the resultant package would be treated as services naturally bundled in the ordinary course of business. Other illustrative indicators, not determinative but indicative of bundling of services in ordinary course of business are - There is a single price or the customer pays the same amount, no matter how much of the package they actually receive or use. The elements are normally advertised as a package. The different elements are not available separately. The different elements are integral to one overall supply - if one or more is removed, the nature of the supply would be affected. No straight jacket formula can be laid down to determine whether a servic .....

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Bundle Supply - GST - Levy and Collection - GST

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