18 February 2015
We are a CHA and also additionally provide transportation services. We are aware that in the case of services provided by a GTA, it is the service receiver i.e. person liable to pay freight whos is liable to pay ST. Now though the problem is that we have not charged our client separately for but the reimbursement for transport cost has been included in agency charges. Also we have books expenses for transport in our books. now the department is of the opinion that, since expenses was booked in our books and we have not separately charged the party for reimbursment of the same, we are the service receiver an hence out to have paid ST under reverse charge.
Do we have any defences against thsi contention of our department? Are there any caselaws available that could presented in our defense?
18 February 2015
The allegation by department is correct, because as per rules you are the person who liable to pay freight and you are using the service of GTA to provide CHA services to your clients. The ownership of expense with you.
You can be defend only if the GTA freight not booked in your books and separately mention in your invoice. So will be able to prove pure agent.
CAclubindia
