Dear Sir
Our Company is engaged in Trading of Edible oil by appointing CFA OR Trade Associate .After the sales we are receiving Cheque payments .As per the Agreement if cheque is bounced more than 2 times we have the right to collect cheque return penalty charges also along with the invoice amount. Plz clarify whether service tax liability is there for the Cheque Return Penalty charges collected from the party.This charges is a part of the sale invoice amount and not providing any service
Debate on Service Tax Applicability for Cheque Return Penalties in Edible Oil Sales Invoices Underlines Complexity A company trading in edible oil seeks clarification on whether service tax applies to cheque return penalty charges included in sale invoices. One participant argues that service tax is not applicable as the penalties do not constitute a service. Another participant references a legal section suggesting applicability, but others disagree, emphasizing that the penalties relate to sales, not services. The discussion highlights differing opinions, with some participants noting the complexity and debate surrounding the issue, and emphasizing that differing views can lead to a more comprehensive understanding. (AI Summary)
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