payment of service tax

This query is : Resolved

Sai Krishna (Querist)
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17 May 2008 We have raised service tax invoices on our customers, but our customers paid only value of service amount, we have not received the service tax from our customer. In this case responsibility of payment of service tax will be on whom? Service Provider or Service Receiver. If service receiver does not pay the service tax amount what should be done. Will any body clarify.

CA UMESHKUMAR R. ACHARYA

CA UMESHKUMAR R. ACHARYA (Expert)
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17 May 2008 The liability of payment of service tax is of service provider.The law of Contract prevails between serice provider & Service Receipent.If You have raised service Tax Invoice including serice Tax & Party has clearly mentioned that He is withholding only service Tax Portion then you are not liable. But in absence of Such clear instruction you are liable for Propotionate payment on prorata basis.

Sai Krishna

Sai Krishna (Querist)
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19 May 2008 For example we raised a invoice for service charges for value of Rs.1,00,000 + service tax there on incl Cess Rs.12,360/- The customer paid only Rs.1,00,000/- only by way of cheque and not paid the remaining Rs.12,360/- even after a long time. In this case are we liable to pay service tax or not.

Sai Krishna

Sai Krishna (Querist)
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19 May 2008 One of my friends company provides service of procuring High value scientific research instruments to the Scientific research Institutes of Govt. and public in India, they are dealers for the Instruments for Principals outside country. The company gets commission from the Principals. Is this commission taxable under the Service Tax. In the Invoices raised by the company use to claim Service Tax but principals not paid this amount. Subsequently the company stopped claiming Service Tax. What is the liability under the Service Tax Law in this context. We are under the impression that we have not collected any service tax hence we are not liable to pay service tax. Please, clarify.

CA. Subodh Kumar 9864367665

CA. Subodh Kumar 9864367665 (Expert)
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19 May 2008 In this also service provider have to pay service tax assuming that amount received together with TDS(in case tds is deducted from whole amount including of service tAx as per practice prevail)is including of service TAx.
For Ex- bill -100
ST- 12.36
Total- 112.36
Amount Received-100
Service TAx payable by service provider=
100/112.36*12.36 =11

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