11 July 2013
Dear All, Please help me solve my below mentioned query:
A Ltd. is a Custom Clearing Agent. In order to provide all around services to its customer B Ltd. it provides in addition to Custom Clearing Service, Transportation of Goods. However in order provide transportation service it does not own any vehicles. It hires vehicles from another transporter C Ltd. at say Rs. 5000 and charges its customer B Ltd Rs. 10000. Now my query is, who will liable to pay service tax under RCM i.e. A Ltd on Rs. 5000 or B Ltd on Rs.10000 or Both.
11 July 2013
Service recipient is liable to pay service tax under reverse charge system. In your case B is a recipient they are liable to pay service tax of Rs. 10,000/-. Agent is not recipient of service.
CAclubindia
