Collection of service tax from the service receiver is mandatory?

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This query is : Resolved

Chyavan K S (Querist)

03 February 2008 hi,
Sec 68 of the Service Tax Act of 1994
explains the collection and payment of Service Tax by a Service provider.
But the Financial Act of 1998 Modifided this section and it explains only the payment of Service Tax by a service provider on taxable srevices but not collection of the same from the servuice receiver and it is silent about the collection.
Is it mandatory to collect the Service Tax from the service receiver and which section of the Act explains it defnetly?

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)

03 February 2008 The liability for pyment of service tax is on the service provider, just as the liability to pay Excise or VAT. The service provider in turn passes this on to the service reciver.

Devendra Mishra

Devendra Mishra (Expert)

04 February 2008 Yes it mandatory to collect the Service Tax from the service receiver and pay to the government

Dayal

Dayal (Expert)

04 February 2008 Being a service provider the onus of CHARGING , COLLECTING AND DEPOSITING with the government treasury is cast on you.

Failure to collect service tax will only render your income to be construed as all inclusive and you will have to work backwords for payment of service tax.

Whether you fail to collect or knowingly you do not collect, still laibility of paying resides with you.

Choice is yours either collect and pay or just pay

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K V Subba Rao

K V Subba Rao (Expert)

04 February 2008 It is not mandatory for the service provider to collect Svc. Tax

It is mandatory for the service provider to pay Svc. Tax irrespective of whether it is collected from the service receiver or not.

In case the service provider does not distinctly show the svc. tax in the invoice, the amount of svc. tax has to be worked out back (total amount multiplied by 12.36 and divided by 112.36)

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