Non payment of service tax

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

17 August 2011 Sir,

I am running UNINOR Store, GSM Service provider (Direct Channel Partner) in West Bengal.
Last fiscal (2010 – 2011) the company reimbursed me with nearly Rs. 68000/- Service Tax amount.

Yesterday, I had gone to the Service Tax Deptt. to meet the concerned Officer of our area to clear off certain queries regarding Non Payment of Service Tax in the current Fiscal i.e., 2011 – 2012 as this year my volume of Business with company will not be more that 6lacs.

The Officer said that since you are dealing directly with a Branded Company & getting Commission on dealings, YOU HAVE TO PAY & are bound to pay the Service Tax.

(1) As per the version of the Officer am I liable to pay the Service Tax, be it on 1lacs or 8lacs, though I’m much below the Exemption limit of 10 lacs. (under Business Auxillary Services).

If this is the case under what Section of Service tax Act is he saying this ??

(2) Suppose I do not ask the company to pay Service tax reimbursement i.e., neither I ask the company to reimburse the Service tax amount to me nor I pay the same with the Service tax Deptt. In that
case what will happen???

(3) Will I be accountable to Penalty under Service tax act in the above case?

Plz. Guide me on the issue.

Thanks.

Sushil Gupta

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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17 August 2011 While using to provide the services for other`s Brand name,such case the basic exemption limit of service tax of Rs.10 Lakh is not available, you need to be pay the service tax from starting onwards

you can ask reimburse with service tax but based on the agreement terms with them.

you need to pay interest on late payment of service tax. Penalty on demand by department can be paid

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