Reverse charge mechanism

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sathya achar

sathya achar (Querist)
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04 March 2014 Hi.,
Is RCM not applied for Private limited company which undertakes GT?

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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04 March 2014 In case of services provided BY GTA, if the person making payment of freight is one of the following, then service tax is to be paid by the person making payment of the freight.

(a) any factory registered under or governed by the Factories Act, 1948 (63 of 1948);
(b) any society registered under the Societies Registration Act, 1860 (21 of 1860) or under any other
law for the time being in force in any part of India;
(c) any co-operative society established by or under any law;
(d) any dealer of excisable goods, who is registered under the Central Excise Act, 1944 (1 of 1944)
or the rules made thereunder;
(e) any body corporate established, by or under any law; or
(f) any partnership firm whether registered or not under any law including association of persons

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sathya achar

sathya achar (Querist)
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04 March 2014 Ok. But My Query is we take service from JANANI TOURS & TRAVELS PVT LTD (GT). In Bill they charge only 40% tax to us. we take input credit for the same. What about remaining 60% ST?...
Please assist me.

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CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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04 March 2014 1. The service is NOT GTA. It is supply of motor vehicle designed to carry passengers.

Ababtement of 60% is applicable in case of supply of motor vehicle designed to carry passengers.

That is why only 40% service tax has been charged.

2. Further reverse charge is NOT applicable because the service provider is a COMPANY.

There is no liability on the service recipient.

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