Query on service tax

CA Mohit Garg (CS Student) (213 Points)

28 June 2013

If a company reimburse expense to Custom House Agent including transportation charges for import of goods. Now, whether company is required to deposit Service Tax on reverse charge basis as GTA on this transportation charges and then claim credit for the same.

Pls provide section, circular, case, etc in supporting

With Regards

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2 Replies

Hadi Husain Husaini (IDT Consultant) (99 Points)
Replied 30 June 2013

Basically, On reimbursement the original invoices are handed over.

If the GTA invoices(or its equivalent) has been handed over, then the person who holds them can claim cenvat credit.

If the relevant services fall under reverse charge mechanism, then service tax has to be paid under reverse charge mechanism. It doesn't matter who pays it. you or your agent.

Prabhat Kumar (Advocate & Consultant) (1912 Points)
Replied 02 July 2013

The liability to pay the Service Tax in case of GTA service is on the recipient of service.The Ex.I of Notification No. 30/2012 dated 20.6.2012 clearly says that the person who pays or liable to pay the frieght is to be treated as person who receive the service.So, in your case as the freight has been paid by someboy else and you have reimbersed it you are not liable to pay service tax.