Dear Sir,
Let us know the applicability of Service tax on tea industries as it is agriculture base industries. '' Kindly advice the following services are taxable in normal case and Reverse charge mechanisim.
a) Service tax on freight outward for tea product.
b) Service tax on freight inwards for store & Spares parts and any capital goods and other consumable items.
c) Service tax on legal , consultancy on tea industries.
d) Service tax on Security service and manpower service on tea industries.
e) Service tax on work contract on tea industries.
f) Service tax on car hire charges on tea industries.
Regards
Sanjoy Das
'
Tea Industry Liable for Service Tax: Processing Excludes Tea from Agricultural Produce Under Finance Act, 1994 A query was raised regarding the applicability of service tax on the tea industry, considering it as an agriculture-based industry. The inquiry focused on whether services such as freight, legal consultancy, security, manpower, work contracts, and car hire are taxable under normal circumstances or through the reverse charge mechanism. The response clarified that, according to the Finance Act, 1994, tea is not considered an agricultural produce because it undergoes processing that alters its essential characteristics. Consequently, the tea industry is liable to pay service tax on all services availed, either directly or under the reverse charge mechanism. (AI Summary)
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