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taxable on receipt basis

This query is : Resolved 
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(Querist)
06 November 2009 Dear Sir,
Service tax billed is taxable on receipt basis. Then, what about partially realised bills, whether whole of the service tax billed is remitted to government or proportionately related to collection?
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Bishwajeet

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Bishwajeet (Expert)
06 November 2009 Pls write breif abt
Partially Realized case.

If reten. amount they have kept on hold as per purchase order.in this case u r liable to pay full ST.
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CA SANJAY MUKHERJEE

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CA SANJAY MUKHERJEE (Expert)
06 November 2009
Tax payable only on amount actually received

Rule 6(1) of Service Tax Rules makes it clear that service tax is payable on value of taxable services received. Thus, if service provider does not receive any payment from his customer, there is no liability of service tax. Service tax is payable only on ‘value of taxable service’ actually ‘received’, and not on amount ‘billed’.

If the service receiver does not pay full amount of Bill and pays less amount, reasonable interpretation is that proportionately less tax is payable.
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