Lesser rate charge

This query is : Resolved

Ravi Nallipogu (Querist)
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03 January 2013 In one case involving as per agreement agreed rate of service tax is 10.3%(agreement valid up to 01.02.13)agreement has done before 01.04.12 but now service tax rate changed as per st rules to 12.36%.but here in this case they are paying service tax @10.3% only it is according to agreement they are arguing...is it correct?...at what rate service tax should be charged...we are auditing for service receiver's books...they are charging@12.36% but these people are remitting@10.3% only...so what should we suggest for them...pleae tell me

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Guest (Expert)

03 January 2013 The liability to pay service by default tax shall be on service provider. Hence if the receiver is not paying service tax @12.36% then the provider shall pay service tax @12.36% considering the difference amount as cost of provision of service.