Whether Demurrage attracts Service tax

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..... Whether Demurrage attracts Service tax
Query (Issue) Started By: - Shyam Naik Dated:- 26-5-2011 Last Reply Date:- 25-1-2016 Service Tax
Got 3 Replies
Service Tax
Dear Experts, Whether demurrage charges collected/charged by service provider attracts service Tax? For example, A GTA may charge demurrage(also known as detention charge) over and above the freight in case there is delay i .....

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..... n loading or unloading. Here freight is undobutedly consideration for service provided, where as demurrage is penal/compensatory in nature. Kindly opine. Regards, SL Naik Reply By pradeep khatri: The Reply: If demurrage is collected as freight, then service tax is payable under GTA services. Reply By Vijay Chitte: The Reply: Demurrage charges are levied when goods are not cleared within sti .....

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..... pulated period. These are penal in nature. The charge is not for providing transport service, Moreover, these are never shown on c/ment Note/ Invoice of GTA. These can not be included for purpose of service tax on GTA service. CBE&C, vide it circular No. 121/3/2010-ST dated 26-04-2010 has clarified that detention charges charged by shipping company / steamer agent for keeping container beyond spe .....

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..... cified periods is "Penal rent" and not a service. No service tax will be payable . This principle applies here also. Reply By KASTURI SETHI: The Reply: Stock Broker's services - Service Tax on delayed payment charges collected by service provider - Clarification Instruction F. No. 137/25/2011-S.T., dated 3-8-2011 Government of India Ministry of Finance (Department of Revenue) Central Board .....

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..... of Excise & Customs, New Delhi Subject : Clarification regarding Service Tax on delayed payment charges collected by the service provider in respect of Stock Broker's services - Regarding.
Discussion Forum - Knowledge Sharing .....

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