Transportation charges

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

13 February 2015 During the year co A has sold goods to Co B. Co A incurres some transportation expnse. Co A also raised debit note for the transportation expense on lumpsum basis.

Now my question is whether service tax is applicable or not.

CA Sandeep Kumar

CA Sandeep Kumar (Expert)

13 February 2015 As per Rule 2(1)(d)of Finance Act, 1994, Service tax on freight should be paid by the person who will pay the freight. In this case Co A pays the transportation exp, he will be liable to pay service tax under reverse charge.

Querist : Anonymous

Querist : Anonymous (Querist)

14 February 2015 But Whether Co A is liable to charge service tax on the Debit note raised to co B which is higher than the actual transport bill.

CA Sandeep Kumar

CA Sandeep Kumar (Expert)

14 February 2015 Yes can charge.

Querist : Anonymous

Querist : Anonymous (Querist)

15 February 2015 Should charge or can charge... as Co A has not charge it now the amt of debit note has cross 10 lac.

CA Sandeep Kumar

CA Sandeep Kumar (Expert)

15 February 2015 If depends on the terms of contract. Otherwise it vl be the cost for Co. A.