PrasadN (Lerner) (105 Points)
02 February 2012Dear All,
I am recently joined FMCG company as tax executive, I observed one issue tax, " vendor raised invoice for 2000/-(Basic :1750+250/- service tax amount) But user dept certified 1000/- worth of services only(950 basic+50 ST), payment also issued for 1000/-
Clarification required
1) If this type short services how much amount we need to take credit
2) Is vendor can reverse the diff of amount of ST.
Dilip Darji
(392 Points)
Replied 03 February 2012
Mr.Prasad.
You are requested to kindly go through Rule 6 (3) of Service Tax Rules, 1994, which are very clear on the issue.
(1) You need to avail CENVAT Credit of Rs.50/- only (Total Value Rs.950/-).
(2) On issuance of credit Note for Service Tax Rs.1000/- (Rs.800/- Value and Rs.200/- Service Tax) , Service Provider (Vendor)shall be entitled to take credit of Rs.200/- for Service Tax paid by him for the amount renegoiated.
CAclubindia
