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Basic Exemption for Service Receiver - Avail?

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27 October 2010 The assessee is liable to service tax as service receiver. can he avail basic exemption limit of Rs. 10 lacs.?

Irecently read the excellent file by Mr. Madhukr sir - Understanding the service tax concepts.

I read the service receiver cannot avail basic exemption - can more resource circulars/notifications be shared in this regard as i want to understand y a service receiver be penalised or say seen liable to tax from first penny of payment for receiving a service?
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CA Shailesh Kumar Bhagat

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CA Shailesh Kumar Bhagat (Expert)
27 October 2010 Except certain cases , service provider is liable for service tax, so threshold exemption will be applicable on provider.

Service receiver is liable for tax on behalf of service provider due to some administrative reasons. So exemtion is not applicable on receiver.

There is no reason of penalizing the receiver, he can deduct the service tax from the bill of provider and deposit the tax.
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