Service Tax Liability for electricity supply on Builder

[Ashwani Rustagi]

Builder or Coloniser is purchasing power in bulk from Dakshin Haryana Bijli Vitran Nigam and distributing the same to the residents of his colony by installing separate meter in each flat. Builder is collecting electricity charges from the residents by adding his administrative charges separately in the invoice.

Can a builder charge servcie tax on electricity charges? If yes, would it on entire amount of electricity invoice or only on his administrative charges?

Your advice is solicted with reference to any notification.

Regards,

Ashwani Rustagi 

AI Summary

Service Tax Applicability: Charge Only on Builder's Admin Fees for Electricity, Not Entire Invoice A builder purchasing bulk electricity from a utility company and distributing it to residents while adding administrative charges to the invoice raises the question of service tax applicability. The query seeks advice on whether service tax should be applied to the entire electricity invoice or only the administrative charges. The response indicates that service tax may be charged only on the administrative charges added by the builder, not on the entire electricity cost.