07 December 2012
Sir. we are providing Work contract service. Fact of case
F.Y 2010 - 10 composition scheme availed but Value of Free Of Cost Material ( FOCM) not available at that time. So concessional rate charged. Client said it will provide FOCM later.
Now in F.Y. 2011-12. Its neither provide FOCM for 2010-11 nor for 2011-12. But giving assurance of Providing FOCM on 2012-13.
Now when F.Y 2012-13 comes client in June stepped back in giving FOCM. So what we did that we issued supplementary invoice in Oct 2012 from FY 2010-11 for the difference of Sr tax.
Now client is saying that due to reverse charge mechanism he will release Half of the difference amount. An our view is that since service is Provided before Reverse charge mechanism and Payment also have been received prior Reverse charge mechanism notification. So in consideration on of POINT OF TAXATION RULE 2011 reverse charge mechanism is not applicable and we are supposed to receive full amount of difference and we will deposit the same.
CAclubindia
