Service tax applicability - category

[pravinchandra salian]

In the manufacturing unit we have our own weighing scale for our finished goods near the factory gate. In our factory premises one more factory is operating with different identity. The ingoing and outgoing of material is the same way for both. Now the other factory is weighing their finished in our weighing scale for which charge a nominal amount. Whether service tax is applicable on the nominal amount under the category of Business Support Service or any other category.

[Brijesh Verma]

Dear Mr. Salian, Apparently there seems to be no Service Tax on the type of services you provide. These seem to be 'Dharam Kaanta' services that you provide and still there is no category under which tax is leviable on such activities.

Views express by Mr. Brijesh Verma are correct as there is some old case deciding that the Dharam Kanta Service is not taxable. However, with the introduction of Business Support Service, the confusion crept into. But, even now, weighing scale service my not be held as providing servcie to support business of your client. This service can be used by anybody whether engaged in business or not. Merely because, this service is being used by some business organization, the same can not become business support service.

No , becaues there is no client and service provider relationship. I cannot provide service to my self

AI Summary

Service tax applicability on weighing-scale charges rejected where no client-service provider relationship and not a business support service.
Nominal charges for permitting third parties to use a factory weighing scale are treated as a Dharam Kanta-type facility and, lacking a client-service provider relationship or a business-support purpose, do not constitute a taxable Business Support Service or other service-taxable activity.