Dear Expert,
X company register with the service tax for GTA service also pay service tax regular basis as per the reverse charge system. Now compay has recived contract for professional service from Y contract value Rs. 8 Lac. As per agreement invoice has been raised without charging service tax for the financial year 2012-13.
Kindly advise what is the service tax liability for Rs. 8 Lac to the Company X.
There are many possible answers in this case. But there are some questions which I would like to ask
1. Is X a Company or not.
2. If X is a Company then is the Turnover of Services is below or above 10 Lakhs in 2012-13
3. What is the turnover of GTA services provided
X is a Manufacturing company and turnover is above 10 lacs for selling of mnufactured goods for FY 2012-13
What is the turnover og Gta Services provided by X..
about 20 Lacs
In this case X company was liable to charge service tax to Y on professional services of Rs 8 lacs provided. If X has not charged Service tax to Y then in this case X would have to pay Service tax on Reverse calculation on Gross Amount Recieved .i.e Service Tax payable would be Rs 800000x12.36/112.36= 88002/-.
Hope it is clear
But if it is below 10 lacs for the specific service and GTA service is applicale for reverse charge system only. X company can't provide any service.
CAclubindia
