Dear Sir, We are actually a real estate company maintaing our residential complex wherein we collect and pay service tax to the Government on Maintenance Charges collected from the residents. The Electricity in the complex is being provided by ABC limited, which is a distribution licensee licensed under the Electricity Act, 2003. ABC ltd., has provided one HT line, from where the Electricity is provided to the individual sub meters of the residents in the complex. Our company is just collecting the Electricity charges as per the rates of ABC Ltd., on “reimbursement basis” at the same rates as are charged by ABC Ltd., in their Bill. There is no Profit/ Loss on the electricity charges being collected as an reimbursement of payments to ABC Ltd. Now, distribution of electricity has been covered under the Negative List w.e.f 1st July, 2012 by a Licensee distributor. We would like to know your opinion: 1) Whether Service Tax is applicable on the reimbursement of the Electricity charges to the company by the residents? 2) What will be the case if the maintenance/ electricity is being done by a residents society and each member’s contribution is less than Rs 5,000/- per month per member but sometimes it crosses the limit of Rs 5,000/- per month for few members/ few months. If Service Tax is applicable in such cases, then will it be applicable to all the members for 12 months or only to the limit crossing members/ limit crossing months. We look forward to a reply. Thanking You, Regards,
Read more at: https://www.caclubindia.com/forum/service-tax-on-reimbursement-of-electricity-charges-241625.asp#.UT28GtYi7VE
