collection of service tax on abatement portion

abatements 1454 views 2 replies

one of my  client carrying chit business  collects service tax on 100% of chit commission and remitting service tax  on 70% chit commission (after claiming abatement @ 30% of chit commission.)

collecting service tax on abatement portion value of taxable service is permissible?

Replies (2)

This is  not allowed.What ever service has been collected has to be deposited in the Govt. account even if  collected where not due.

There is an express provision Sec.73 A wherein whatever has been collected as ST has tobe remitted to the GOvt. If you wish to avoid the same then the excess ST collected shshould be returned to the customer.

Interest is also applicable on the delayed payment. 


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