If vendor does not charge service tax on invoice

Thanks for the query,
Service tax is usually to be paid by service provider/vendor,
although few of the services are listed in a scheme called 100% RCM reverse charge mechanism, in which service receiver is required to pay the whole of service tax by himself, in such case vendor would not show any service tax liability in the bill he issues,
but also if in case he is a small service provider ie, annual service provided is 10lacs or below he is not covered in service tax law so he will not show any service tax in bill,
but lastly if in case he was required to pay service tax and still he did not mention service tax liability in bill separately, in service tax law it will be deemed that such total bill amount is inclusive of service tax and by grossing up technique service tax will be calculated,
eg bill amount 10000/- and no service tax is mentioned,
grossing up will apply,
10000/115*15= 1305 is service tax part
and balance is value of service,

thus, if in case there is no mention of service tax separately in invoice, service receiver will not be liable for service tax liability normally and generally and the vendor will be liable to pay service tax and govt. will be recover tax from vendor only. Service Receiver will not be liable.

Hope you have an idea about the issue,
if any query please revert,
Thanks,
Abhimanyu

Thank you so much for the insights.. I really appreciate for you quick response.

Regards

Shibsankar Ghosh

 

 

If service provider/vendor charges 14.5% service tax in invoice instead of 15%, is service receiver required to pay 15%.

Regards,

Sudheer Kumar N 

Its also useful to me sir, Thanks to questioner and answerer.