Section 67 of the Act has made provision for valuation of taxable service for charging service tax. According to Section 67(1)(a) of the Act where there is a monetary consideration paid to provide taxable service, the assessable value for levy of service tax is gross amount charged by the Service provider for the taxable service provided. Sub-section (2) of the said section has made provision to include the amount of service tax to the gross value of consideration where taxable service provided is inclusive of service tax. The term consideration for the valuation of taxable service is defined by explanation appearing under Section 67 meaning that consideration includes any amount that is payable for the taxable service provided or to be provided.
The liability of the appellant arose under the Act in terms of Section 66A of the Act as recipient of service of Engineering Consultancy from the Consultant abroad. Rule 7 (1) of the Service tax(determination of value) Rules, 2006 which came into force with effect from 19.4.2006 has made provision in respect of services covered by Section 66A of the Act. According to this Rule, measure of value for taxation of service covered by that Section shall be such amount as is equal to the actual consideration charged for the services provided or to be provided…. read more