Query: =
The individual ( MD of the this Pvt Ltd) who own the patent and also Our Pvt Ltd is taking Service Tax Registration. But we are confused about what class or classification of service should we take registration for the Individual himself and for the Company also?? For Franchise or IPR=Intellectual Rights Property class??
Details:=
The Individual is registered in the Register of Patent-holders maintained by the Controller of Patents (India).
The Pvt Ltd Co, having taken rights to use this patent, has applied for registration in the Register of Registered Users maintained by the Controller of Patents (India).
The Individual will be billing the company for Royalty (based on per unit implemented by Company thru Franchisee), on which service tax is chargeable. The company will be paying Royalty to the individual=patent holder (including Service Tax ).
The pvt ltd company in question has taken rights/ sub-license from the individual ( who is also the promoter of this pvtl ltd co) who is inventor and registered owner of the patent of a unique technique to harvest rainwater. The implementation of techique requires one material component that is a special made PVC Sheet. This special PVC Sheet is a part of the design of the technique without which the structure made by use of this patented technique is incomplete.
Now the company is appointing Franchisees at various places. The Franchisees will do the actual execution of Work / structure by using the patent technique and the special PVC Sheet.
The Company will be billing the Franchisee by two seperate bills or a single bill for two items i.e (1) Royalty for patent for per unit structure = Rs. 8000 on which Service Tax is chargeable @ 10.3%; (2) A special PVC Sheet for per unit structure =Rs. 2500 on which MVAT is chargealbe @ 4%.
I hope the detail given will help the friend/ experts to give a more reasoned opinion.
