Electricity Charge by Community Hall/Banquet Hall

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..... Electricity Charge by Community Hall/Banquet Hall
Query (Issue) Started By: - Vinay Jhawar Dated:- 26-3-2016 Last Reply Date:- 27-3-2016 Service Tax
Got 4 Replies
Service Tax
A Community hall/Banquet Hall/Samaj Bhawan if collects actual electricity charges specifically by taking the meter reading along with some mark up from the person who takes it on rent and shows it separtely in th .....

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..... e invoice as electricity charge. Is service tax to be paid on the same? Will it be termed as sale of electricity? Reply By Ganeshan Kalyani: The Reply: Sir, You have mentioned that ''if collects actual electricity charges'', this clarifies that there is no service charges added by you from the persons who take the hall on rent. Hence this cannot become service, this is pure reim .....

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..... bursement. No service tax. Thanks. Reply By Vinay Jhawar: The Reply: Sir there is a mark up involved say ₹ 1 per unit to meet incidental expense for electricity maintenance. Again even though, if there is no mark up I have a doubt that can a hall provide its service without electricity, even though they may be collecting it seperately. Can it be termed as sale of electricity by hall to .....

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..... the person who takes it on rent? Reply By Rajagopalan Ranganathan: The Reply: Sir, According to Section 67 (1) (i) of Finance Act, 1994 service tax chargeable on any taxable service with reference to its value shall, in a case where the provision of service is for a consideration in money, be the gross amount charged by the service provider for such service provided or to be provided by him. Th .....

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..... erefore if the bill issued by the service provider includes the electricity charges collected from you in the total amount charged by the service provider then you have to pay service tax on total amount indicated in the bill. But your service provider may collect the electricity charges in actual for onward deposit with the electricity department. In this case it need not be included in the total .....

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..... amount charged by the service provider. Electricity charges should be collected separately. Reply By Vinay Jhawar: The Reply: Thank you sir.
Discussion Forum - Knowledge Sharing .....

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