Question ID :
44655
COMPANY RUN ITS OWN BUS FOR TRANSPORTATION OF ITS EMPLOYEES
Dear Sir/Madam,
Please note, a manufacturing company run its own bus for transportation of its employees. Since the appointment letter given to employees does not specify about the Transportaion facility, the GST auditor treats this as service given by employer to employee treating it as related party transaction and applying cost+10% valuation rule asking company to pay the GST liability with interest and penalty. Whether the action of the auditor is justified. Please let me know how to go about this.
Posted by
Shridhar H
on
May 25, 2024
Filed Under
GST
no
Posted by
ASHISH AGGARWAL on
May 25, 2024
Answer ID :
85430
Usually Services provided by an employee to employer in terms of employment Contract is neither a Supply of goods nor a Supply of services as per schedule III and thereby no Gst is payable. Further as per the press release insured by Ministry of finance dated 10th July 2017 it can be understood that services by an employer to employee as per contractual agreement is also not subject to Gst. In the instant case, it
is told that there is no clause in the employee contract, to provide transport facility. I assumme the transport facility
given is a non-Ac contract carriage. The same is exempted as per clause 15(b) of Notification 12/2017_CT (R) as amended from time to time. Further support can also be taken from the Gujarat AAR in the case of Emcure pharmaceuticals Limited [ Gunj/ GAAR/R/2022/22.
Posted by
SREENIVASULU THULASIRAM on
May 26, 2024
Answer ID :
85431
THIS IS JUST UNTHINAKBLE AND IN MY VIEW NO TAX LIABILITY ARISES AB INITO , HERE AS
1.THIS IS CO'S OWN BUS
2.CO IS NOT INTO PASSANGER CARRIAGE BUSINESS
3.IT IS NOT SERVICE PROVIDED BY CO TO STAFF AS
3.A : ALL SERVICES OF EMPLOYEE TO EMPLOYER ARE EXCLUDED FROM SUPPLIES
3.B : SO WHEN CO PROVIDES SUCH FACILITY TO STAFF THERE IS NO CONSIDEARTION FLOWING BACK TO CO.
3.C : IN ABSENCE OF CONSIDEARTION SERVICES ARE NOT GETTING INTO SUPPLY
SO QUIESTION OF TAXABLE SUPPLY NEVER ARISES AND NO TAX CAN BE DEMANDED
CO NEVER PAY TAX WHILE THEY DO PICK OR DROP FOR THEIR GUESTS
ANYTHING CAN NEVER BE EVERYHING
THUS I ALSO AGREE ON SIMILAR BOTH ABOVE VIEWS REPLIED BY SHRI ASHISH JI AND VERY LOGICALLY WITH CASE STUDIES BY SHRI SREENIVASULI JI
Posted by
VIPUL JHAVERI on
May 27, 2024