Invoice raised wrongly including service tax

This query is : Resolved

Mahesh S. Pillai (Querist)
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11 December 2011 Dear sir, kindly consider my query.

Suppose an assessee have raised an invoice wrongly including the service tax, (the assessee's gross income fall below the threshold limit).
Invoiced amount has been received after deducting TDS.

what is the best option from the following?
(1)Apply for service tax registration and pay the amount so collected and then surrender the service tax registration.
Or
(2)Pay back the amount collected as service tax to the client and issue/raise a new invoice without service tax.

Maninder Jain

Maninder Jain (Expert)
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12 December 2011 I hope the remittance for the invoice is not received. In this case you can cancell the invoice & raise a fresh invoice.
In case remittance for the invoice is received, adjust this amount in some other invoices & follow step 1 above.

Mahesh S. Pillai

Mahesh S. Pillai (Querist)
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12 December 2011 Dear sir, kindly consider my query.

Suppose an assessee have raised an invoice wrongly including the service tax, (the assessee's gross income fall below the threshold limit).
Invoiced amount has been received after deducting TDS.

what is the best option from the following?
(1)Apply for service tax registration and pay the amount so collected and then surrender the service tax registration.
Or
(2)Pay back the amount collected as service tax to the client and issue/raise a new invoice without service tax.

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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12 December 2011 Mr MS Pillai,
Mr M jain has already answered your point. There is one more way: you can issue a credit note showing returning the amount wrongly collected and adjust that amount in any future bills or pay back.
There is no compulsion to register under ST Act when your gross income is below the threshold limit.
MJK

Message likes : 1 times

Mahesh S. Pillai

Mahesh S. Pillai (Querist)
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12 December 2011 Thank You Jain Sir & MJK Sir for clarifying my query.

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