TaxTMI 
TaxTMI 
TaxTMI 
FOC warranty
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....OC warranty<br> Query (Issue) Started By: - suresh ramu Dated:- 27-11-2015 Last Reply Date:- 3-12-2015 VAT + CST<br>Got 8 Replies<br>VAT / Sales Tax<br>Dear all Pl clarify about FOC Warranty would attract VAT/CST. Reply By Ganeshan Kalyani: The Reply: Warranty is service and not sale. Vat is on sale consideration and thus warranty should not be taxed under Vat / Cst. Reply By KASTURI SETHI: The....
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.... Reply: Rightly explained by Sh.Ganeshan Kalyani Ji. Reply By YAGAY AND SUN: The Reply: Dear Suresh, If under warranty, any inputs, components, raw material or accessories are being replaced then Input Tax Credit so availed, needs to be reversed provided if there is no consideration is involved or no Output VAT is being paid. It is a settled Legal Position under the State Specific VAT laws. R....
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....egards, YAGAY and SUN (Management, Business and Indirect Tax Consultants) Reply By MARIAPPAN GOVINDARAJAN: The Reply: If warranty is a service whether the provisions of service tax will attract? Reply By Ganeshan Kalyani: The Reply: Warranty is like insurance I.e. if any thing happens during the warranty period then the service will be rendered. Hence service tax provision is certainly applic....
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....able. Reply By Vivek anandhan: The Reply: Dear all : We are not going to collect service charges for service provided during warranty period then how Service Tax will attract. Reply By KASTURI SETHI: The Reply: Dear Sh.Suresh Ramu Ji, As per dictionary meaning, warranty is a written guarantee, issued to the purchaser of an article by its manufacturer, promising to repair or replace it if nec....
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....essary within a specified period of time. What I have experienced and observed that warranty is never FOC selling price includes the cost of repair or replacing any party during the warranty period. It appears FOC to the purchaser but de fecto the manufacturer recovers the cost of warranty (provided for a stipulated period) through dealer while fixing the wholesale/retail sale price of the product....
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..... So FOC warranty is an eye wash. It also depends upon the terms and conditions of the contract executed between the manufacturer and the dealer. During my service, I have detected such cases of non-payment of Service Tax and recovered the amount not paid. Hence Sh.Ganeshan Kalyani is absolutely right on this issue. There is no doubt that repair of any goods is taxable service in the form of warra....
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....nty. Reply By MARIAPPAN GOVINDARAJAN: The Reply: Very elaborative discussions. Thank you to every one.<br> Discussion Forum - Knowledge Sharing ....