Invoice date in case of continous work

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Prem Chandra Thakur (Querist)
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10 December 2011 Sir,

We are raising our bill for brokerage on our customer in the month of Dec'2011 instead of April'11 to Nov'11.We are not received any amount during that period. So, Our Service tax liability will be in the Jan'2012.

Sir, I want to know whether there would be any problem for us if the bill is not raised month wise in case of continuous work started from April'2011.

Thanks,

Regards,
Prem Chandra Thakur

PUNEET GOYAL

PUNEET GOYAL (Expert)
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10 December 2011 As per 3rd proviso to Rule 4A (1) of Service Tax Rules, 1994
Provided also that in case of continuous supply of service, every person providing such taxable service shall issue an invoice, bill or challan, as the case may be, within fourteen days of the date when each event specified in the contract, which requires the service receiver to make any payment to service provider, is completed.
Thus in your case you have to check that whether there is any event provided in the contract on which customer is required to make payment. If yes then invoice should be raised within 14 days of the date of that event.
For example if the contract is for a period of 1 year and there is clause in the contract that first payment will be made after one month of start of contract or after completion of X activity 20 % payment will be made by customer. In that case invoice will be raised within 14 days of receipt of first payment or completion of X activity.

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