Goods transport agency service, who pays service tax

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 November 2015 I am a Excise Duty Firm, Which is one of the Specified Person in the S T Law.

As a Consignee, if the Freight is paid by me, then as per reverse mechanism, I have to pay the S T. @ 14%.

As a Recent Case Law, Indian Oxalate Ltd vs Ass. Com Kohlapur West Bench Taken a Decison in the favour of the Govt.

In the above case law, the consignor is arrange the GTA to transport the goods to the consignee. but the consignor charged the consignee the freight amount of the delivery of the goods. Here the Tribunal given against the assessee judgement. and consignor is a person to pay the service tax.

But as per Cenvat Credit rules also, upto the place of removal we can avail the cenvat credit on him.

Kindly give reasons and supportings.of his above discussion.
Query
1) Who is liable to pay service tax. and how it is calculated, if the consignor gets reimbursement of freight from the consignee.
2) Ex: if the Freight charged Rs. 15000/- in the bill itself. then we have to calculate on Freight amount of Rs. 15000/- @ 14% = 2100
15000*14/114% = 1842

Kindly Give suggestion... with supporting's circular/notification

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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18 November 2015 1 Consignor is liable to pay service tax. 14% service tax payable on 30% value of the freight. Service tax is payable by the person who pays freight to GTA. 70% abatement in service tax is available for GTA services.
2 Get the details from consignor on service tax payment. The consignor might have added some charges on his part.

Querist : Anonymous

Querist : Anonymous (Querist)

18 November 2015 Can be give some proof/evidence/supporting for of your answer.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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18 November 2015 Search www.taxgru.in on service tax on gta.

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