Reverse charge mechanism

This query is : Resolved

VIPIN KUMJAR (Querist)
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14 December 2012 I want to know that in case, a service is covered under reverse charge mechanism and the liability of Service Provider and service receiver is 40% and 60% respectively ( Rent a cab). Now, The service provider has charged 100% tax in the bill raised by him. In this case also, Whether the service recipient is liable to discharge his share (60%) to the s tax department.

visu iyer

visu iyer (Expert)
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14 December 2012 To my view,
the liability can't be shifted;
It is for the corporate to pay 60% under revese charge mechanism.
Moreover, it is not known whether the service provider pays the tax or not.

It is safer for the corporate assessee to pay the service tax @ 60% and deny the portion of the service tax in the service provider's bill.