One my client is a Net work Agent in a Public company. He Collects Deposit from new Customers on Daily/monthly/Weekly basis and remits the deposit to the company. On the spot he is paid 2% of the Deposit amount for the existing Depositors,5% in respect of new Customers, 10% on Fixed deposit or on Site Deposit. In this way he earned Rs.5 Lakhs during 2012-13.This year he has been elevated as Leader. From this elevation he gets 5% as commission on the deposit mobilised by the Agents under his control. In view of this he will get a minimum of Rs.40000-50000/ -commission per month from April 2013.Apart from this he will get field allowance of Rs. 5000/- and insurance facilities.
Concerned Company is not collecting or paying Service Tax on commission. It is also ascertained that there are more than 80000 Agents, 500 Team leaders and 26 Top Leaders who are earning Rs. 3 Lakhs per month as commission.
Kindly clarify, whether my client is liable for service Tax or not..
