Whome to pay service tax

This query is : Resolved

Srimannarayana (Querist)
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24 March 2016 We are Central Government Organization registered under Societies Act 1860 (not a body corporate) 100% funds by Government of India. We have received Manpower Services from a company. Reverse Charge Mechanism is not applicable to us as we are not body corp.
Now my Query is who has to pay Service Tax Service Provider or Service Receiver(us)?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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24 March 2016 In this case service provider has to pay service tax.

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Srimannarayana

Srimannarayana (Querist)
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24 March 2016 Sir enven though RCM is not applicable for the first half year( April 2015 to September 2015) we have paid Service Tax 75% by Service Receiver and 25% by Service Provider in this case what we have to do as a Service Receiver?

Suresh Ramaswamy

Suresh Ramaswamy (Expert)
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24 March 2016 Reverse Charge Mechanism is applicable as far as Manpower Recruitment Service is concerned - if the service recipient is a body corporate, else not. If the service recipient is not a body corporate like your organization - no liability rests on you and as far as you are concerned - whether the service provider has charged service tax or not is not your outlook or liability. In this case, service tax if any is payable will by the service provider.

Suresh Ramaswamy

Suresh Ramaswamy (Expert)
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24 March 2016 If any duty that is not due and payable is paid to the Government, the person paying such erroneous duty is eligible to claim refund. Normally the refund claim has to be submitted within one year of the date of payment. Therefore file an application for refund with the relevant documents.

In case the liability to pay duty was not there and the same has been paid, the time limit for filing the refund claim does not apply - since it not seeking refund of duty paid. However as a matter of abundant caution stick to the one year deadline.

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