Amways- their dealers/ agents or franchisee are reselling goods on Amway and get profit margin as dealer woul dget depending on volumes generated by the team of any dealer. Though they show it commission, but in fact it is margin of a trader. Whether sommission / profit earned will be subject to service or not. In case they are dealer then servicetax should not be levied. any case law on this subject and current positin may be explained.
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I do not agree with the view that the profit of the dealers / agents working under MLM schemes like of Amways is not a commission but a margin of profit. They are not only earning from direct sales from them but also get from the sale made by agents in the chain. Commission is highly dependable on performance. The marketing and procedure is directly under the umbrella of Amways. Though not sure, but of the view that they also do not get themselves registered with local VAT department as a dealer. So, there is no reason to treat the profit earned by them other than commission. Service tax is fully applicable.