Point of taxation-service receiver liable to pay service tax

This query is : Resolved

Prosenjit Banerjee (Querist)
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27 July 2013 For Example:

Transporter "T" provides Transport Service to a company “C” in the month of April'2011.

“T” raises the bill in the Month of May'2011.

And let us assume that the bill reaches Company “C” only in the month of June'2011 and "C" accounted the same in June’11.

The Company “C” makes the payment in the month of July'2011 after the Credit Period.

As the Company “C” is the receiver of GTA service, liable to pay Service Tax on GTA.

In the above circumstance, Clarification required for Service tax payment due date on considering new Point of taxation rules 2011 and also clarify the present rule

Please also clarify whether point of taxation is applicable for GTA under reverse charge mechanism ?

Ganeshbabu K

Ganeshbabu K (Expert)
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28 July 2013 1)As per RULE 7..Service tax is payable by service receiver when actual payment is made to service provider and not on receipt of Invoice from service provider.

2)However, if payment is not made to service provider within 6 months, service tax is anyway payable.In this case POT will be as per RULE3, Interest is also payable.

Thanks & regards
Ganesh babu k