13 October 2010
hi please guide me on follwing issue :
A company providing a taxable service all over india including jammu & Kashmir but didn't charge service tax on invoices raised for J&K. So my query relates to whether the co. in category of providing taxable services as well exempted services and provision of rule 6 of cenvat credit rules applicable to co. ( means to confirm whether co pay service tax j&k bill @6% or reverse cenvat credit on pro-rata basis )
13 October 2010
Dear Nitin as service provided in J&K are not covered under service taxability as per sec 64 hence any provision of finance act 1994 is not applicable and question of rule 6 of ccr dosent arises
14 October 2010
Ya i know j&k is not under purview of service tax thats why we are not charging service tax on that , but we are availing input credit on all services out which some are those which supports us in providing services in J&K.
15 October 2010
First of all only services provided in J&K are excluded from the levy. Services provided from elsewhere would be liable ot ST.
If excluded it could be called non taxable service and therefore it maybe reasonable to assume that Rule 6 may apply. Option to maintain separate records or reverse the 6% are available.
15 October 2010
with due respect to above coments sir applicability or inaplicability of st provisions shall be decided with refrence to location of services provided and not with refrence to location of service provider hence eg. person in delhi providing services in j&k the following service would be non taxable as far as rule 6 is concern it deals with maintainenc of seprate a/c or pay @ 6% in case of output services are exempt and rule 2(e) of ccr 2004 states exempt services means taxable services which are exempt and includes services on which tax is not levied us sec 66 of fa act hence both the option of 6% and seprate a/c are avalable
one another confusion with me is that our service is taxable in all over india but according to law there is exclusion of tax in j&K services , so our service is taxable in one state and not taxable in other so whether we can fall in category of providing taxable as well as exempted service because we are providing only one service.
If we are providing service 1 & 2 And service 1 is taxble & Service 2 is not covered by finance tax then we should say that providing taxable as well as exempted service but in our case i don'nt think so . Please help me out to clear all these confusions
16 October 2010
Rule 6 of Cenvat Credit Rule is applicable, when services are provided at nil rate of duty in J&K, using input/input services on which Cenvat Credit has been taken.
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