Service tax on credit note, Service Tax

[SAKHARAM MAGDUM]

We paid commission to the party which credit note is raised to the party who is given us a order. What is the effect in excise/service tax ? Who will be pay the service tax?

Posts / Replies

[V Ramanujam]

From your query, it is presumed that commission is paid to the party itself who has given the order for supply of goods/services to him. In such a case, the amount cannot be considered as 'commission' as one cannot render service to himself. It is more of discount/subvention which is passed in the form of commission. To avoid complications, the amount itself may be termed as discount/subvention in which case no excise/service tax is attractable.