CENVAT CREDIT QUERY

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This query is : Resolved

ANAND SHARMA (Querist)

15 June 2010 SIR,

PLEASE WRITE THE RELEVANT PROVISION OF THE ACT.

OUR COMPANY IS CONTRACTOR IN IOCL. WE SUB CONTRACT THE WORK TO A SUB CONTRACTOR. WE TOOK THE CENVAT CREDIT OF SERVICE TAX (AFTER RECEIVING THE TAX INVOICE & PAYMENT OF SAME BILLS TO SUB CONTRACTOR).

NOW SERVICE TAX DEPARTMENT CHECK OUR RECORD FOR CENVAT CREDIT TAKEN BY US FOR CROSS VERIFICATION FOR PAYMENT OF SERVICE TAX. DEPARTMENT FOUND THAT THE SUB CONTRACTOR DID NOT MAKE THE ANY PAYMENT OF SERVICE TAX TO GOVERNMENT.

SERVICE TAX DEPARTMENT IS NOW SAYING THAT AS OUR COMPANY TOOK THE CENVAT CREDIT SO OUR COMPANY IS RESPONSIBLE FOR PAYMENT OF SERVICE TAX. THEY TELL US ABOUT THE RULES 9, 6 & 3 OF THE ACT.

PLEASE CLARIFY THE MATTER THAT WHO IS RESPONSIBLE FOR PAYMENT OF SERVICE TAX WITH RELEVANT PROVISIONS.

REPLY URGENTLY.

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)

15 June 2010 SERVICE TAX CREDIT ON THE BILL ARE TAKEN AFTER THE PAYMENT OF THESE BILLS. i.e you have paid to the party. Now if party has not depoisted the service tax , then it is liablity of party.
Hence you have to submited account of the party with payment proof agasint bill. There is no liablity agaisnt you. Service Tax dept should take action agaisnt party which has not deposited the govt. due.

Message likes : 1 times

CA CS CIMA Prakash Somani

CA CS CIMA Prakash Somani (Expert)

15 June 2010 Its not your fault or you are not liable to make good the losses to IT dept if the third party did not paid the tax to govt.

Hence if you have all the documents for tds then you are not liable to pay to IT dept. the defaulter will be the company which does not paid the tax to govt.

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)

15 June 2010 Somani Ji, There is the case of service tax.

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