Payment of Service Tax

[kiran pai]

Dear Sirs,

We are the receipient of a security agency service in our HO at Mumbai.  The said agency is changing the service tax on the gross value of the bill for the concerned month.  Now my queiry is that, the gross amount inclusive of salary of the security guard, other statutory obligations like ESIC, PF, Professional tax LWF etc.  Then why we have to pay the tax on these above mentioned elements.  Why not only on  the service charges?

Please clarify my doubts

Thanks,

Kiran Pai.

AI Summary

Service tax on security services applies to gross charges including wages and statutory levies; bifurcation won't avoid tax.
Where a security agency employs and supplies guards, the total consideration it charges-including wages and statutory employer contributions-constitutes the value of the security service for service tax; bifurcating salary or statutory levies does not exclude them from the taxable base, though if the client directly employs staff and the agency provides only supervisory expertise, only the agency's discrete service charges may be taxable.