Aggregate Taxable value

[Vijay Chitte]

We have to pay commission to our C&F agent @2% on net sale value i.e. net sale value is 1000000 and his commission is Rs.20000 (2%) My question is which is agreegrate taxable value of C&F agent? Is it Rs.1000000 or 20000?(commission)any one can guide me?

[Surender Gupta]

Service Tax is payable on Rs. 20,000/- only. Rs. 10,00,000 represents only value of sale and not any service.

It is Rs.20000/- on which service tax @12.24% (including e.cess) is payable.

[Brijesh Verma]

Dear Vijay, As you may be aware, C&F, in layman language is known as Aaratiya.These aaratiyas are of two types: Kacha and pakkaa. In case of pakkaa even income tax law guides that turnover shall include the amount of sales i.e 1000000 as in your case. however, service tax covers only those aaratiyas or c&fs who are not pakkaa. therefore feel free tax is to be paid @ 12.24% on 20000 only.

It is Rs 20000 only. The sales he made is on behalf of principle company only and not his sales

AI Summary

Aggregate taxable value: commission for C&F agents forms taxable value, with service tax applicable on commission only.
Service tax is payable on the C&F agent's commission only, not on the principal's gross sales, because the agent sells on behalf of the principal; the service tax rate (including cesses) applies to the commission. A distinction is noted between pakkaa and non-pakka C&F arrangements, with service tax applying to non-pakka agents' commission.