Dear Sir, I have issued invoices of Rs. 2,72,000/- during the FY 2015-16 to several clients who have not paid me the amount till date. During the Service Tax regime for the FY 2015-16 & FY 2016-17, I filed my ST-3 on receipt basis as my GTO was less than 50 Lacs per annum. Such amount I have already written off in my books for the Income Tax Purposes. Can the department ask me to pay the Service Tax on such invoices along with Interest & Penalty?
As I understand, no service tax is payable in this case as you have already written off the dues. So no interest and penalty too.
Thank you. Can you share any Judgement or any Case Law wherein the issue has been taken up and duly resolved.
Refer this: https://www.casemine.com/judgement/in/574bdf74e561095bc6d331e8
This case law is not mainly about whether there exists a liability of service tax in case of bad debts; it also goes further in to utilization of cenvat credit on input services in such cases.
You can still find here the solution to your query.
Thank you for your reply
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