Utilisation of service tax credit
This query is : Resolved
Jagan Mohan Misra
(Querist)
09 April 2012
Dear Sir,
We are GTA. We provided service to indian companies. As per law liability of Service Tax is on consignor or consignee. However we want to pay Service Tax for the service provided to the company and recover the same from service receiver. For making payment of Service Tax we want to utilise the CENVAT credit available in our books.
Is it allowed?
We are GTA. We provided service to indian companies. As per law liability of Service Tax is on consignor or consignee. However we want to pay Service Tax for the service provided to the company and recover the same from service receiver. For making payment of Service Tax we want to utilise the CENVAT credit available in our books.
Is it allowed?
CA CS Amit S. Kedia
(Expert)
09 April 2012
Dear Mr. Jagan,
GTA is not liable for service tax, The recipient of service is liable for service tax.
however, if GTA does not provide consignment note then he would be liable for service tax but GTA is not allowed to take cenvat credit rather he is eligible for availing specified services without payment of service tax.
hence, Even if GTA is paying service tax, cenvat credit is not allowed to be taken.
GTA is not liable for service tax, The recipient of service is liable for service tax.
however, if GTA does not provide consignment note then he would be liable for service tax but GTA is not allowed to take cenvat credit rather he is eligible for availing specified services without payment of service tax.
hence, Even if GTA is paying service tax, cenvat credit is not allowed to be taken.
CA Kishore Tallam
(Expert)
09 April 2012
Not in all cases, the service receiver is liable to pay service tax. In some cases, the service provider only have to pay. However, in first scenario also, if the service receiver wants to pay service tax, there is no bar on them. Hemce the service provider can levy service tax and pay the same by utilisation of cenvat credit.
CA CS Amit S. Kedia
(Expert)
09 April 2012
GTA are not allowed to take cenvat credit.
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