TAXABILITY

[SANJAY JAIN]

We are engaged in cleaning and safe disposal of sewer . Is the cleaning taxable?

[YAGAY andSUN]

Dear Sir,

Cleaning or disinfecting of sewage tanks/reservoirs used by industrial/commercial establishments are taxable.  But, if,  such services pertains to residential premises, then, not taxable.

As per section 65 (24b) of the finance Act, 1994, "Cleaning Activity' means:

"Cleaning, including specialized cleaning services such as disinfecting, exterminating or sterilizing of objects or premises, of -

1. Commercial or industrial buildings and premises thereof; or
2. factory, plant or machinery, tank or reservoir of such commercial or industrial buildings and premises thereof,

but does not include such services in relation to agriculture, horticulture, animal husbandry or dairying."

The above definition contains the following important features:

1. Cleaning activity means cleaning i.e. to say all types of cleaning is covered.
2. Specialized cleaning services such as disinfecting, exterminating or sterlizing are also covered by the definition.
3. A cleaning or specialised cleaning must be of objects or premises.
4. such premises mist be commerical or industrial building or premises or factory, plant or machinery, tank or reservoir of such commercial or industrial building and premises.
5. Cleaning activity relating to agricultural, horticultural and animal husbandry and diarying are not with in the scope of the definition.

 

 

 

 

[Alok Kumar]

Dear Mr. Sanjay,

In my opinion in case the  said services are provided in relation to non commercial or non-industrial purposes  then your services will not be covered by the said definition as provided in the relevant  Finace Act.

please check whether the subject matter of cleaning activities are:

"Commercial or Industrial bulidings or their premises ".

thanks,

Alok Kumar

AI Summary

Service tax on cleaning services applies when rendered to commercial or industrial premises, not to residential or agricultural uses. Service tax applies to cleaning and specialized cleaning services when performed for commercial or industrial buildings and their premises, including factories, plants, machinery, tanks or reservoirs; such services for residential, non commercial/non industrial purposes, and services related to agriculture, horticulture, animal husbandry and dairying are excluded from this definition.