Credit of service tax paid on gta service by the receiver

This query is : Resolved

Sowmya.S.Balan

Sowmya.S.Balan (Querist)
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19 June 2013 dear sirs
our company (contractors)pays service tax on gta service by cash 2000/-. after availing abatement .can we take credit of the same 2000 to pay service tax on works contract service . is there any difference when tax paid on inward transport and outward transport regarding tax payment, abatment or credit of tax payment

Ganeshbabu K

Ganeshbabu K (Expert)
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19 June 2013 1)Cenvat credit cannot be used to pay tax by service receiver. Service tax as to be paid by cash only i.e. GAR-7 challan.

2)Once paid, Cenvat credit can be taken if otherwise it is his eligible ‘input service’.

3)Tax should be paid under service tax registration number of service receiver and included in his return as he is liable to pay service tax.

4)Service tax is payable by service receiver when actual payment is made to service provider and not on receipt of Invoice from service provider. However, if payment is not made to service provider within 6 months, service tax is anyway payable. Interest is also payable.

Thanks & regards
Ganesh babu k

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