A Propreitorship firm is running a C and F for a reputed company. At present C & F is not carrying transportation, Company itself has tied up with 7 transporters from 3 years. Now the company is handing over complete transportation to the C & F agent. Till now none of the 7 transporters have paid any service tax. once the complete transportation is given to the C & F, are they eligible to pay the service tax? The turnover of transportation is 1 crore per year.
Please answer me
Once the C&F agent assumes the responsibility of paying Service Tax, you are inviting trouble as there is no restriction in paying Service Tax on transportation by the proprietorship ifrm but the cost of transportation will be included in your commission for the purpose of gross value of taxable service and then the prop. firm will be liable to pay ST on transportation as well as commission.
Gupta Sachdeva & Co. Chartered Accountants
New Delhi
CA Final
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Naveen Fintech Pvt Ltd
Kolkata
CA Inter
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CAclubindia
