what proof of documents on service tax input

This query is : Resolved

Aravind (Querist)
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03 March 2010 Dear Sir,

one of my friend company receiving service from labour contractor. the service provider chargin his bill along with applicable service tax and mentioning his service tax registration number in that invoice. servicer receiver pays the full invoice value and taken in ER-I return on particular service tax amount as input.

now the department people asked service receiver to submit the proof of payment made by service provider if not to do so the service receiver is liable to pay the full amount or reverse the same input credit.

next the service receiver tried to get the proof of payment from service provider and he know that the service provider is a fake.

now who is liable to that particular tax?

please clarify and thanks in advance.

Aravind Kumar Ch.

Shyam Lal Naik

Shyam Lal Naik (Expert)
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03 March 2010 Sir,

The facts are self contradictory.

When the service receiver is receiving the bill and making the payment, how can it be stated that the service provider is fake?

Vipin Gupta

Vipin Gupta (Expert)
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04 March 2010 Dear Sir,

As per rule 4 sub rule 7 provides that cenvat credit in respect of input service shall be allowed, on or after the day which payment is made of the value of input service and the service tax paid or payable as indicted in invoice, bill or, or as the case may be, challan referred to in rule 9

SANJAY JAIN

SANJAY JAIN (Expert)
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09 March 2010 The CENVAT Credit on the receiving end can not be denied for the reason service receiver's bonafide nature. This has been clarified under the Circular No. 766/82/2003-CX dated 15-12-2003 and now on making payment of input service value, the receiver is legally entitled for credit.

For further query, feel free to write sanjayinfbd@yahoo.com (M-09350048731) or visit, HNO. 2489/8,Faridabad(Haryana).

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