Multiple Providers of the Same Service Who pays the ST

Originally posted by : Stanley Ravi
	We are a travel agency, at times we run short of vehicles, so we request our sub-vendors to provide services. We collect Service Tax from our clients, and pay to the Government, our sub-vendor also has raised a bill. He also has to pay Service Tax, now how and from whom does he collect the Service Tax?

sub vendors has raised a bill to you, with service tax, you have to take input credit of service tax so paid and set off from liability of your service tax payable.

agreed with Mr. U. S. Sharma

Can you give us an example of what  "input credit of service tax so paid"  means.

f sub-contractor charges bill of Rs.110.30 including service tax than you could take input credit of service tax Rs.10.30

Further to pankaj arora's example, the input credit of Rs.10.30/- will have to be reduced from the out put service tax liability of say Rs.5000.30/- So, the net tax liability for the cab-owner is rs.4990/-.

rengaraj r.k