Service tax paid by both party

This query is : Resolved

Somnath (Querist)
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27 December 2014 there is one company who has charged n paid service tax for renting of their yard to another company of 1month but at the time of submision of bill, second party rejected bcoz they also paid the service tax...they are saying that provide us bill without S.T. now pls tel me our company already paid S.T. how to get back???

CA Kumar Mukesh

CA Kumar Mukesh (Expert)
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28 December 2014 In case of renting of Immovable property person who providing such services are required to pay service taxes, however, in case of service provider located outside the taxable territory service receiver required to pay service taxes under rule 5 of place of provision rules 2012.

However, As per landmark judgement of Apex court in case of RASHTRIYA ISPAT NIGAM LTD. v. M/S. DEWAN CHAND RAM SARAN, it was held that service tax is in the nature of indirect tax and tax liability can be shifted on the basis of agreement/contract.

Therefore, in your case if are sure that payment is already made by service receiver there no need to be pay service tax once again. For this purpose you can ask for challans of Service Tax payment for future reference.