Small service provider benifit by a transport operator

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Somnath Sharma

Practicing Chartered Accountant

45 Points Posted on 12 September 2014

We have a client providing GTA Service which have 20 Crores approx turnover of freight charges from Cement Manufacturing Companies (paying service tax under reverse charge). this client has also earned freight charges from other transporters (individuals, working for other cement manufacturing companies and others) approx 20 lacs.

Out of which approx 10.5 lacs are from those individuals which are working for companies and companies are depositing service tax on that 10.5 lacs. and for rent 9.5 lacs no service tax is being deposited to service tax.

1. Whether for availing SSP benifit what would be value of taxable service ? 9.5 lacs or 20 lacs. will 10.5 lacs will come under reverse charge ?

2. And if value of Taxable service is 9.5 lacs, than whether it should be shown in return or we can file NIL return ?

Replies (3)

CA Ashish K Bansal

partner

250 Points Posted on 15 September 2014

What do you mean by individuals working for other cement companies

Somnath Sharma

Practicing Chartered Accountant

45 Points Posted on 15 September 2014

Other individuals means person who are the authorised transporters of Cement Companies, who have contact our client for trucks for their transportation work in that companies. The companies will first make payament to that individuals and they after deducting their margin say Rs 10 per MT of weight transported remiit the balance amount to us.

Say total freight of this transaction comes to Rs 100000. those individuals deduct Rs 5000 as commission and remit us Rs 95000. the 10.5 lac rs is the total of that 95000 type of amount. these individuals raises a consignment note whereupon it is marked that" service tax will be paid by ""

Than whether it will be counted under Reverse charge value of service provided and thereafter will SSP benifit will be available as other services amount is Rs 9.5 lacs.

In ST return what is the value of taxable services to be shown ? pls help urgent ?

CA Ashish K Bansal

partner

250 Points Posted on 15 September 2014

Frieght for which you do not raise your consignment note does not come under gta hence no liablity of service tax by you rest amount is less than 10 lac so ssp exemption available in st 3 service provided to cement company and rest of 9 5 lacs should be shiwn as vslue of service and exemption shiuld be claimed for service prov8de to cement company and ssp should be claimed