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Reverse charge mechanism

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This query is : Resolved

Siva Kumar G (Querist)

21 February 2015 A Company made use of Legal services of a firm of advocates in the month of June 2014.

The company got registered under service tax only in the month of October 2014.

Service Tax liability was not discharged by the advocates firm in the invoice raised by them citing reverse charge liability lies with the company.

The contention of Company is that since registration was done only in the month of October, no liability in their part?

Who has to discharge the liability??

Rajesh Sharma

Rajesh Sharma (Expert)

21 February 2015 The Company cannot take such a stand, the liability under reverse charge remains with the Company and accordingly was liable to take registration and discharge its liability. There is a delay on the part of the company in obtaining registration.

It is advisable to pay the liability under reverse charge along with interest, to avoid future litigation

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