Service tax gta

This query is : Resolved

jignesh (Querist)
Follow

11 March 2014 I want to know that we are paying transport charges to transporter for our outgoing material and they are not charging service tax on LR and we are also not paying service tax so we are liable to pay serivce tax ?? if yes, then we are eligible to take credit that outward transport charges service tax which we pay by GAR-7 Challan.

Currently we are paying service tax on GTA by GAR-7 Challan on inward transport charges paid to transporter and they are not charging service tax on LR... and we take credit of service tax paid on GTA and utilise against our duty payable..

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
Follow

11 March 2014 Reverse charge is applicable in this case. Accordingly you have to pay service tax. You can claim CENVAT credit of the service tax paid on the basis of GAR 7 challan.

Message likes : 1 times

jignesh

jignesh (Querist)
Follow

11 March 2014 ok, but if we pay service tax on outward transport charges, then also eligible for credit ?? as there is some confusion between inward & outward transport charges, we currently pay only inward freight service tax by GAR-7 CHALLAN and take credit..
Pls. clarify we have to pay service tax on outward freight which we paid, and eligible for credit also ??

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
Follow

11 March 2014 1. You have to pay service tax on inward as well as outward freight.

The Act does NOT distinguish between outward & inward freight.

2. You are eligible to avail CENVAT credit of service tax paid under reverse charge whether paid on inward or outward freight.

CA RICHA BADALIA

CA RICHA BADALIA (Expert)
Follow

11 March 2014 You cannot claim cenvat credit on service tax paid on outward freight.

Message likes : 1 times

jignesh

jignesh (Querist)
Follow

11 March 2014 K.A. : Richa Bothra

You mean we have to pay service tax on outward freight by GAR-7 and we are not eligible for credit taken ??

jignesh

jignesh (Querist)
Follow

11 March 2014 There is too much confusion of taking service tax on inward & outward freight, which we paid by GAR-7 challan.. Any one can give notification for this inward & outward freight service tax on GTA regarding... ??

CA RICHA BADALIA

CA RICHA BADALIA (Expert)
Follow

11 March 2014 Yes!! you are correct

Message likes : 1 times

jignesh

jignesh (Querist)
Follow

11 March 2014 is there any notification for this inward & outward freight service tax credit regarding.. please provide the same...

jignesh

jignesh (Querist)
Follow

11 March 2014 K.A. : Richa Bothra

Can u provide me any notification In this regards for inward is eligible and outward is not eligible ??

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
Follow

12 March 2014 Service tax paid under reverse charge is eligible for CENVAT credit, whether paid on inward freight or outward freight.

The Act, CENVAT Credit Rules DO NOT distinguish between outward freight & inward freight.

Service covered under reverse charge is services provided by a Goods transport Agency.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now