Reverse charge applicability
This query is : Resolved
21 January 2014
Please calrify whether reverse charge would be applicable in following case-
We received advocate's service during period Apr'12 to june'12 vide bill dated 30.06.12.
However bill booked in our accounts on 31.10.13 and payment made agst this bill on 07.12.13.
Please advise.
Thank in advance.
We received advocate's service during period Apr'12 to june'12 vide bill dated 30.06.12.
However bill booked in our accounts on 31.10.13 and payment made agst this bill on 07.12.13.
Please advise.
Thank in advance.
21 January 2014
Reverse charge on dated 31.10.2013
22 January 2014
Thanks for ur advice sir,
Would you please tell me related provision or section for reverse charge applicability.
because as far as reverse charge notification is concerned it is applicable with effect from 01.07.12. and in our case provision of service was completed on 30.06.12 (i.e. before 01.07.12). So, what base should be taken for our opinion that reverse charge is applicable.
Would you please tell me related provision or section for reverse charge applicability.
because as far as reverse charge notification is concerned it is applicable with effect from 01.07.12. and in our case provision of service was completed on 30.06.12 (i.e. before 01.07.12). So, what base should be taken for our opinion that reverse charge is applicable.
22 July 2025
Great question! Let me break it down for you:
Issue:
Advocate’s services were rendered between April 2012 to June 2012 (before 1 July 2012).
Bill dated 30 June 2012.
Bill was booked in accounts only on 31 Oct 2013.
Payment was made on 7 Dec 2013.
You want to know whether reverse charge (RCM) is applicable.
Key points:
Reverse charge under Service Tax was notified and applicable from 1 July 2012 onwards (as you mentioned).
Service period is critical in deciding tax liability:
Tax liability generally arises on the date of provision of service or date of invoice, whichever is earlier.
Since the service was provided before 1 July 2012, the reverse charge mechanism introduced from 1 July 2012 does NOT apply retrospectively.
Booking and payment dates do not change the time of supply or service period:
Even if the invoice was booked or paid after 1 July 2012, the relevant date is when the service was provided (April-June 2012).
Conclusion:
Since the service was completed before 1 July 2012, the reverse charge notification effective from 1 July 2012 will not apply to this service.
The liability to pay service tax (if any) should have arisen as per the old rules (pre-July 2012) and not under reverse charge.
The payment/booked date (in 2013) does not trigger reverse charge for a service provided earlier.
Relevant Law Reference:
Section 68(2) of the Finance Act, 1994 and Notification No. 30/2012-ST specify RCM applicability from 1 July 2012.
Service tax is chargeable on the date of provision of service or date of invoice, whichever is earlier (Section 67 of Finance Act, 1994).
Issue:
Advocate’s services were rendered between April 2012 to June 2012 (before 1 July 2012).
Bill dated 30 June 2012.
Bill was booked in accounts only on 31 Oct 2013.
Payment was made on 7 Dec 2013.
You want to know whether reverse charge (RCM) is applicable.
Key points:
Reverse charge under Service Tax was notified and applicable from 1 July 2012 onwards (as you mentioned).
Service period is critical in deciding tax liability:
Tax liability generally arises on the date of provision of service or date of invoice, whichever is earlier.
Since the service was provided before 1 July 2012, the reverse charge mechanism introduced from 1 July 2012 does NOT apply retrospectively.
Booking and payment dates do not change the time of supply or service period:
Even if the invoice was booked or paid after 1 July 2012, the relevant date is when the service was provided (April-June 2012).
Conclusion:
Since the service was completed before 1 July 2012, the reverse charge notification effective from 1 July 2012 will not apply to this service.
The liability to pay service tax (if any) should have arisen as per the old rules (pre-July 2012) and not under reverse charge.
The payment/booked date (in 2013) does not trigger reverse charge for a service provided earlier.
Relevant Law Reference:
Section 68(2) of the Finance Act, 1994 and Notification No. 30/2012-ST specify RCM applicability from 1 July 2012.
Service tax is chargeable on the date of provision of service or date of invoice, whichever is earlier (Section 67 of Finance Act, 1994).
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- House Property Reporting in ITR
- Refund Annexure-B
- TDS Claim year
- Liable to deduct tds and 44ADA
- Rent lease agreement
- Refund of 20%pre-deposit paid for stay application
- Nomination of Bank for refund in itr 2
- Section 56(2) of the Income tax Act 1961 , Gift to relative .
- TDS Challan Code
- SGST balance is there in credit ledger how to adjust for cgst
- Internship/Academic shown in Salary Pay Slip of a Doctor
- E Commerce GSTR1 & 3B how to file
- GST Cancellation without jurisdiction
- Legal Opinion on Registrar's Refusal to Investigate a Society for Non-Renewal and Non-Compliance
- GST Refund_RFD-01
- Form10BD was uploaded successfully without any Error but after 24 hours, Form10BE are not available
- Annexure B utility for GST Refund
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
