18 December 2014
Dear Sir/Mam We are a private limited company, registered under central excise. We use to sell FOR Goods manufactured by us to the registered private limited companies (buyer). We raise the invoice as below Basic Value 100 Excise duty (12.36%) 12.36 VAT(5%) 5.618 Total 117.978 Transportation Charges 30 Grand Total 147.978 Risk during the period of transport remains with us i.e. on supplier (as per PO). As per PO, the contract is to supply the Goods at the place of buyer. For the above transportation facility, we use to engage outside individual truck owner who are self employed and pay them Rs. 20. No any consignment note is issued by the agency, goods carries only excise invoice raised by us as above. My query is who is liable to pay Service tax on the above transport facility i.e. Supplier or Buyer and on what value Rs. 30 or Rs. 20 paid to agency. Whether any excise implications also involved in it. If possible plz give the reference of any case law, I will be highly obliged to you.
18 December 2014
According to Reverse Charge Mechanism, payment of service tax liability for the services provided by GTA is on the service receiver.
The consignor or consignee whoever pays the freight is liable to pay service tax if such consignor or consignee is any one of the following: Any factory registered under the Factories Act. No excise implications involved in it. Pay service tax on Rs 20 under GTA and Rs 10 on business auxiliary service.
CAclubindia
