Service tax on delivery expenses

Queries 380 views 1 replies

I am a delaer of excisable goods, and in the course of business undergo expense to the tune 12-15 lakh p,a on account of delivery expenses of goods to the customer.
Now all these expenses are paid to truck drivers/tempo drivers by cash but against vouchers and show them in my p&l a/c every yr.My queries are as follows:
 
* Had read that when a transaction (for a delaer of Excise) exceeds 750 (or 1500 in certain cases) the receiver of the service is liable to pay 2.575% (25% of 10.3%).. Does that mean i need to register in the service tax and start paying the taxes. I dont mind paying Rs 25000/30000.00 Service p.a , if paying the sum makes my expenses legal.
 
* These tempo/truck owners dont have any registrations /no income tax files, and will it be alrite if i pay without showing their names in the service tax...
 
* Most importantly, i have been incurring these expenses from 2007 onwards but came to know of this quideline only now... what should i do.. If i register now, would that mean that i will have to pay for all these yrs

Replies (1)
Yes,as per sec 2(1)(d) of Finance Act,1994 in relation to Goods transp agency serv if consignor or consignee is Dealer under CE ,P'ship firm,co.,HUF etc. the liab to pay ST is on whom 'who is liable to pay freight',so you as a Consig'or being a dealer under CE and also liable to pay freight is liable to pay ST(with abatment of 75%).However,Services rec by Goods Transport agency for transport of veget,fruits,pulses,food grains&eggs is exempt from whole of ST leviable thereon. But since you are liable to pay from 2007(don't show that you are liable from 2007,but show it from 11-12) ,you need to obtain registration and pay ST and recover same from customers and pay from Fin 11-12 with int.


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