TRANACTION WITH ASSO. ENTERPRISE

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Guest (Querist)

23 October 2009 I KNOW FOR THIS PURPOSE ASSO. ENTT. MEANS WHICH DEFINE U/S 92A OF IT ACT PLz EXPLAIN TRANACTION WITH ASSO. ENTT.

Shyam Lal Naik

Shyam Lal Naik (Expert)
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24 October 2009 Your question is related to Service tax.

Normally, liablity to pay service tax arises, when such tax is collected by the service provider. For example if bill is raised in April, but payment is received in Sep. Tax shall be payable by 5th of Oct.

However, in case, service is rendered to associated enterprise, the liability to pay tax arises on the day of making entry in the books of accounts. Entry may be for bills, advance or book adjustment. If the service provider and service receiver are associated enterprises in the above example, the tax shall be payable by 5th May / 5th July itself.

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