Service Tax Online

Service Tax Online

TOP

ISSUE 1: Whether commission received by distributors for distribution of mutual fund units is liable to Service Tax under Business Auxiliary Service? ANSWER 1: Distributors receive commission from mutual fund for providing services relating to purchase and sale of Mutual fund units. Services provided by such distributors are in the nature of commission agent and are, thus, liable to Service Tax under Business Auxiliary Service [section 65(105)(zzb)]. ISSUE 2: Persons / agencies canvass advertisements for publishing, on commission basis. Such persons / agencies do not provide any other services like making, preparation, display or exhibition of advertisement. Whether merely canvassing advertisement for publishing on a commission basis by persons / agencies is classifiable as Advertising Agency service [section 65(105)(e)] or not? ANSWER 2: Merely canvassing advertisements for publishing, on commission basis, is not classifiable under the taxable service falling under section 65(105)(e). Such services are liable to Service Tax under Business Auxiliary Service [section 65(105)(zzb)].