St number

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Guarav Sharma

Guarav Sharma (Querist)
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29 April 2011 Whether qouting of service tax no without PAN is valid, i.e. ST no is qouted but PAN no is missing.

CA Parmeshwar Rathi

CA Parmeshwar Rathi (Expert)
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29 April 2011 1. In this regard, it is mentioned that it shall be compulsory for all the ' concerned Service tax assessees registered under the Rules to obtain PAN whether or not they pay Income Tax. The Income Tax Department is being requested to allot PAN on priority basis to all concerned persons.

(2) It is further mentioned that the STC Number will be introduced w.e.f. 1/1/2002. However, the existing classification Code (if any) will continue to be mentioned in all the Service Tax documents which specify/prescribe for mentioning of STC Number.However, from 1/7/2002, only the STC Number will be used.

so, PAN based No is Mandatory. it must be applied earliest. without it, bankers would not accept deposit of service tax.

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Guarav Sharma

Guarav Sharma (Querist)
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29 April 2011 Thanks allot sir,
And i duly request you to assist in this regard:-
Concerned person in above case is a transporter & party is collecting Service Tax on freight :-
1. Is this collection of service tax is valid inspite of the fact that ST no qouted is wrong.
2. If such collection is not valid , does any liability to pay service tax arises
by the party paying freight ti the transporter.

Asha Kanta Sharma online

Asha Kanta Sharma online

(Expert)
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25 July 2025 Great question — this relates to **Service Tax registration, PAN linkage, and liability** in the case of transporters, specifically in **2011**, under the **reverse charge mechanism**.

Let me answer your queries clearly, step by step:

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## ✅ Background (as per 2011 Rules):

* From **01.07.2002**, **Service Tax Code (STC)** was made **mandatory** and had to be **based on PAN**.
* Format of STC Number = **PAN + ST + 001**
(e.g., ABCDE1234FST001)
* Without PAN-based STC, the number is considered **invalid**.
* **Transport of Goods by Road (GTA)** was subject to **reverse charge**, where the **service recipient (consignor/consignee)**, not the transporter, was liable to pay ST.

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## 🔹 Q1: Is collection of Service Tax by transporter valid if ST No. quoted is wrong (not PAN-based)?

### ❌ **Answer: No — not valid.**

* Quoting a **non-PAN-based or incorrect ST number** is **non-compliant**.
* As per CBEC instructions, **PAN-based ST registration** is **mandatory**.
* Further, in case of **GTA**, the transporter is **usually not liable to collect ST**.

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## 🔹 Q2: If such collection is not valid, does liability to pay ST fall on the party paying freight?

### ✅ **Yes, most likely — if reverse charge applies.**

### Under **Rule 2(1)(d)** of Service Tax Rules, 1994:

For **Goods Transport Agency (GTA)** service, **service tax was payable by the receiver of the freight**, if:

* The receiver was:

* A factory,
* A registered society,
* A company,
* A partnership firm, etc.

So, **even if the transporter collected ST wrongly**, the liability may **still fall on the freight recipient**, depending on their status.

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## ✅ Summary:

| Issue | Answer |
| -------------------------------------- | ------------------------------------------------------------ |
| ST No. quoted without PAN valid? | ❌ No – PAN-based STC mandatory |
| Can transporter collect ST on freight? | ❌ Not usually – under **reverse charge**, recipient pays |
| If ST collected wrongly, is it valid? | ❌ No – receiver should not accept such invoice |
| Who has the liability? | ✅ The **receiver of freight**, if covered under Rule 2(1)(d) |

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## 🚨 Suggested Actions:

1. **Receiver of freight** should:

* Verify if they are liable under reverse charge.
* **Pay ST directly** and not reimburse the transporter.
* **Claim CENVAT credit** if eligible.

2. **Transporter** should:

* **Stop charging ST** unless they are clearly **registered as GTA** and authorized.
* Apply for **PAN-based ST registration** if providing other taxable services.

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Would you like a draft letter format to respond to such a transporter requesting correction or refund of wrongly charged ST?

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