Reverse charge mechanism
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
21 February 2014
As per notification no. 30/2012 dated 30 june 2012, in case of manpower supply services, the service provider will charge service tax on 25% of the services provided, and rest 75% will be paid by the service receiver.
If the service provider charges service tax on 100% of services, then what would be the obligation of service receiver. What penalty will be charged on service receiver?
If the service provider charges service tax on 100% of services, then what would be the obligation of service receiver. What penalty will be charged on service receiver?
24 February 2014
Service recipient is liable to pay his portion of service tax along with interest and penalty.
However in a recent judgement the Hon’ble Mumbai CESTAT, in the case of Umasons Auto Compo Pvt. Ltd. Vs. Commissioner of Central Excise & Customs, Aurangabad [2014 - TIOL – 126 – CESTAT - MUM] in case of GTA Services held that once the amount of Service Tax is accepted by the Revenue from the provider of GTA service, it cannot be demanded again from the recipient of the GTA service.
You may take benefit but matter will be subject to litigation.
However in a recent judgement the Hon’ble Mumbai CESTAT, in the case of Umasons Auto Compo Pvt. Ltd. Vs. Commissioner of Central Excise & Customs, Aurangabad [2014 - TIOL – 126 – CESTAT - MUM] in case of GTA Services held that once the amount of Service Tax is accepted by the Revenue from the provider of GTA service, it cannot be demanded again from the recipient of the GTA service.
You may take benefit but matter will be subject to litigation.
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