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Punjab Sales Tax on Services Act, 2012 QUESTION #2566
Question 1
Under section 7(3), where the person providing the service and the recipient are ASSOCIATED PERSONS and the service is supplied for no consideration or lower consideration, the value of the service shall be:
  • The cost of providing the service
  • Open market price of the service
  • The price at which the service is provided to non-associated persons✔️
  • Zero, since no consideration is received
Correct Answer Explanation
Section 7(3) states that where parties are associated persons and the service is supplied for no consideration or lower consideration, the value shall be the price at which the service is provided to OTHER PERSONS WHO ARE NOT ASSOCIATED PERSONS.