TaxTMI 
TaxTMI 
genset is rented to clients and receipts are more than 20 lacs , whether service tax ia applicable as service is of producing electricity.
service tax on renting of genset
23 Feb 2014 
2 Replies 
4902 Views Asked by
Service tax on rented genset applies where lessor retains effective control; otherwise VAT may arise as deemed sale.
Service tax applies to renting a genset where the provider is not an electricity transmission or distribution utility; the transmission/distribution exemption is limited to bona fide utilities. The applicable tax regime depends on the effective control test: retained effective control yields a taxable service (service tax), while customer control may convert the transaction into a deemed sale attracting VAT. (AI Summary)
Service tax applies to renting a genset where the provider is not an electricity transmission or distribution utility; the transmission/distribution exemption is limited to bona fide utilities. The applicable tax regime depends on the effective control test: retained effective control yields a taxable service (service tax), while customer control may convert the transaction into a deemed sale attracting VAT. (AI Summary)