Service tax on negative list services

This query is : Resolved

Krishna Prasad (Querist)
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14 March 2013 i have received advance towards provision of taxable services before 01.07.2012. from 01.07.2012 the said service is exempt from services tax as per sec-66D negative list. service was provided after 01.07.2012.

Whether i am liable to pay service tax on the advance amount eventhough the service is exempt from service tax from 01.07.2012 and also the service was provided after that date?

Please help me in this regard

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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14 March 2013 Is your date of Invoice is after 1-7-2012.

OM SAI SRI SAI JAI JAI SAI

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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14 March 2013 According to the RULE 4 of Point of taxation: POT in case of change in effective rate of tax.
Thus according to such rule if the service is provided after the change in rate of tax then either payment or issue of invoice taken place after the date of change then consider the such date in case both payment and issue of invoice taken place before to change of rate but service provided after the change then which is earlier i.e date of payment or issue of invoice which is earlier shall consider as POT.

In your case Service is provided after the change in rate of tax but payment received as advance before to the change so you have check the date of issue of invoice if the invoice is issued after the change of rate i.e after 1-7-2012 then your POT is date of invoice and not liable for service tax because as at the time of POT the service tax rate is Zero.
In case if invoice also issued before to change then date of advance received or date of invoice which is earlier is POT and liable for service tax @12.36% because of service tax rate at the time of POT is 12.36%.

OM SAI SRI SAI JAI JAI SAI

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