SERVICE TAX ON OUTSOURCING OF AIR TICKETS

[DEEPAK GUPTA]

Dear Sir,

We are IATA BSP agent  and  we are dealing in air ticketing and depositing the service tax monthly basis recovered from agents/customers  and adjusted the same with service tax payable on commission received from Air Lines. We are also doing outsourcing  of Air tickets from IATA BSP agents and they are recovering service tax from us on Std. Commission+PLB/ discounts given to us . Sir My  querry is :- Should I show this commission amount (Received from outsource Agent ) in service tax return or not,  whereas the tax is already recovedred by IATA BSP Outsource agent from me  in his billing.

The specimen of the invoice issued by the IATA BSP outsource agent to my Company is given below.

IATA BSP AGENT BILLING TO MY COMP.              SAME INVOICE FROM MY   COMP.  TO OTHER CO.

Supose Basic fare &Taxes                 10000            Suppose Basic fare &Taxes            10000                               

Less Std. Commn+PLB/Dis. (-)           1000            Less Std. Commn+PLB/Dis. (-)          900

                                                         9000                                                                  9100

Add Service Tax on Rs. 1000               124            Add Service Tax on Rs. 700/-              84

                                                                                    ON STD. COMMN. ONLY

 Net amount I have to pay to              9124             Net amount I have to Receive         9184         

 IATA BSP Outsource Agent                                   From customer   

Whether we can take cenvat credit on outsourcing or not and how can we adjust the same . Also I am not depositing Rupees 84/-  because I have already paid Rs. 124/- to IATA BSP Outsource Agent.

Jatinder Sharma

AI Summary

Clarification Sought on Service Tax Reporting for Outsourced Air Ticket Commissions and Cenvat Credit Eligibility Under IATA BSP. An individual inquires about the proper handling of service tax related to outsourcing air tickets. They are an IATA BSP agent who collects service tax from customers and adjusts it against the tax payable on commissions received from airlines. They outsource tickets and pay service tax on commissions to another IATA BSP agent. The main query is whether to report this commission amount in their service tax return, considering the tax has already been recovered by the outsourcing agent. They also question the eligibility for cenvat credit on outsourcing and how to adjust it. A respondent suggests that this issue requires detailed analysis.