How to bring the earliar period input

This query is : Resolved

Ashish Khandelwal (Querist)
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21 November 2013 HELLO SIRS
ONE OF OUR CLINT HAVE NOT PASSED THE SERVICE TAX INPUT TAX CREDIT ENTRIES IN LAST YEAR IN HIS BOOKS OF ACCOUNTS, BUT HAVE TAKEN THE INPUT TAX CREDIT ON THE BASIS OF INPUT BILLS.

NOW AS A CONSEQUENCE OUTPUT SERVICE TAX IS SHOWING A LARGE CREDIT BALANCE. HOW TO REDUCE SUCH BALANCE RELATED TO PAST YEAR.

CA Galib Mirza

CA Galib Mirza (Expert)
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21 November 2013 Dear Ashish
In case your client has not bifurcated the amount of CENVAT credit out of the the Inputs then you may take the same in next year by way of reversing such amount to the related exepnse.
As in your case client has not made the bifurcation but he has taken CENVAT credit, you have to check the calculataion of service tax payable as per return ST3 and books of accounts.You should reconcile the same.

Ashish Khandelwal

Ashish Khandelwal (Querist)
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22 November 2013 Dear Sir,
Thanks for replying.
but actualy the accountant has passed the entries of related expenses without taking input last year. ie.
DIRECT EXPENDITURE DR.
TO PARTY

I have calculated service tax input on those expenses, the input match with the input shown in service tax return.
The accounts of last year have already been audited. Now we have only task to reduce the output tax balance, which is showing a big wrong credit balance.
plz suggest journal entries.