Service tax on goods transport agency

This query is : Resolved

Darshan P Dedhia (Querist)
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11 July 2013 Dear All,
Please help me solve my below mentioned query:

A Ltd. is a Custom Clearing Agent. In order to provide all around services to its customer B Ltd. it provides in addition to Custom Clearing Service, Transportation of Goods. However in order provide transportation service it does not own any vehicles. It hires vehicles from another transporter C Ltd. at say Rs. 5000 and charges its customer B Ltd Rs. 10000.
Now my query is, who will liable to pay service tax under RCM i.e. A Ltd on Rs. 5000 or B Ltd on Rs.10000 or Both.

Arun Kumar Singh

Arun Kumar Singh (Expert)
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11 July 2013 Service recipient is liable to pay service tax under reverse charge system. In your case B is a recipient they are liable to pay service tax of Rs. 10,000/-. Agent is not recipient of service.

Darshan P Dedhia

Darshan P Dedhia (Querist)
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11 July 2013 What if A Ltd is not agent? It is registered under service tax under category of Transport of Goods by road.

Darshan P Dedhia

Darshan P Dedhia (Querist)
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11 July 2013 What if A Ltd is not agent? It is registered under service tax under category of Transport of Goods by road.

Arun Kumar Singh

Arun Kumar Singh (Expert)
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11 July 2013 A is not recipient of services. actual recipient is B.

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