One of my client is an technological based company they sale their their products as well as provide AMC(service) to their clients
They issue different bills to their for the goods & for the AMC(SERVICE INCLUDING SERVICE TAX )they provide but their client give them the payment in lump sum amount . The general credit period provided by the company is 3-4 months
EXample of the Query
GOODS SOLD to A in april Rs50000 AMC Provided to A in april Rs20000
After 3-4 months A gives my client a check of some amt say Rs 65000
..... more goods as well as services are bieng provided to A during this period of 3-4 months.
MY QUERY :- HOW TO DIFFERENTIATE THE AMOUNT RECD FROM A BETWEEN GOODS & SERVICE PROVIDED WHAT AMOUNT OF SERVICE TAX IS BEING PAID BY A
The service tax charged by you in your AMC bills will act as an input credit for the CO. availing this service.
So, unless and until it makes payment for the full bill it can't take its input credit in toto.
So, the best solution to this problem is whenever the concerned party makes you any lumpsum payment just get a letter from them as to against which bill/s payment belongs.
CAclubindia
