22 December 2012
Hi Friends! I m in Little doubt about Service Tax, please resolve it.....
According to Point of Taxation Rules, 2012, Service tax will apply on issue of invoice or receiving of payment, whichever is earlier. In Case,If we made bill of Rs.10000+1030(S.tax @10.3%) in April 2012 and pay the service tax of Rs.1030 with the monthly return payment recd from client 7000+721(S.tax @10.3%) in June 2012.
Now my Question is this:- Can we reduce the liability of June 2012(in Monthly Return) by Rs. 309(1030-721) and can take the credit of service tax excess paid or we will bear full liability of service tax by Rs 1030 in case of short payment recd from client.
you are not considering Rule 4 of POT Rules, 2012 rate of tax in your case sud be 12.36% not 10.30%. Second thing you can adjust the excess service tax paid only if there is deficiency in the Service or negotiation in the price.
You can not the follow the practice suggested by you.
I m aware about both things u tell me, but now my question is this: In case if a person is using the practice as same as i said above, paying the tax and filing the return as per above practice, then what should be the action of Deptt and what should be the remedy for the person to avoid the penalty of deptt? Should the return be revised?
28 December 2012
@ Ankit If you receive the notice then Service tax along with interest @ 18% on short payment + Penalty shall be levied under Section 78 of the Act. Pay the balance tax and intimate the department before you receive the Show cause notice and Revise the Return.
CAclubindia
