Reimbursement of service tax
This query is : Open
14 June 2009
Dear sir
We were awarded a contract and in this connection we have sub-contracted certain works to NRI company. On the payments made to the NRI (sub-contracted) we have paid service tax on reverse charge mechanism. The person who had awarded the work had reimbursed the payment of service tax made by us on the NRI payment. Our claim is as per the contractual provisions. Whether there is any mistake in our claim. Can law prohibits such reimbursement claim because it is service tax paid on the input service.
We were awarded a contract and in this connection we have sub-contracted certain works to NRI company. On the payments made to the NRI (sub-contracted) we have paid service tax on reverse charge mechanism. The person who had awarded the work had reimbursed the payment of service tax made by us on the NRI payment. Our claim is as per the contractual provisions. Whether there is any mistake in our claim. Can law prohibits such reimbursement claim because it is service tax paid on the input service.
14 June 2009
Question not so clear as to who is to avail the credit.
I am not sure that ST on reverse charge basis under the rules of 2006 is required to be paid for reimbursements.
However the credit shouldbe admissible as input services.
I am not sure that ST on reverse charge basis under the rules of 2006 is required to be paid for reimbursements.
However the credit shouldbe admissible as input services.
17 June 2009
Re framed question could be:
In case:
1. Service tax has been deposited for NRI sub-contractor by a company and
2. reimbursement has been claimed for service tax deposited from main contractor
Whether input credit for such service tax can be claimed by company?
In case:
1. Service tax has been deposited for NRI sub-contractor by a company and
2. reimbursement has been claimed for service tax deposited from main contractor
Whether input credit for such service tax can be claimed by company?
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