Service tax claim in the subsequent year by the lessor

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

04 June 2012 We have taken a building on lease for business purpose. In the first year of lease period the lessor has not raised any invoices for the rent and we paid the same based on the agreement and based on the rent receipts from the lessor.

In the second year of lease the lessor came up with a statement showing the service tax liability on the rent of the first year as he went for service tax registration recently.

My argument is one can raise the service tax invoice with in a period of 14 days or 30 days as per recent modification. And one can not claim the service tax for the preceding years from the lessee, even though he is actually liable to pay the same to the service tax department due to having crossed the registration limit and not went for registration. Is my stand correct or not... If not correct why should i have to pay the service tax and file the revised returns for the earlier years.

Dayal

Dayal (Expert)
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05 June 2012 Point of Taxation Rules, 2011 notified through Budget Notification No. 18/2011 ST dated 1st March, 2011 has addressed credit on supplementary invoice which reads as under :

Supplementary invoice, bill or challan issued by a provider of output service, which should be in terms of the Service Tax Rules, 1994 is also added as one of the documents on which credit can be availed. However if such invoice is raised by the service provider in cases where such additional amount of tax became payable by him on account of fraud or collusion or wilful mis-statement or suppression of facts or contravention of any of the provisions of the Finance Act or of the rules made thereunder with the intent to evade payment of service tax, then it would not be considered as eligible document for credit.

In your case the service provider has paid service tax on his own and therefore credit is permissible to you.

you have to take an undertaking from the service provider stating that the said service tax paid is not on account of suppression of facts or contravention of any of the provisions of the act to safeguard your interest.

The supplementary invoice is being raised in the current financial year, so there is no restriction on availment

The clarification is not a legal advise, and is provided based on the interpreation of the act. The views expressed above are personnel.