Service tax - reverse charge mechanism

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

16 January 2014 Dear Sir,

In case of Security Services reverse charge is applicable. what should be done if the service provider sends the invoice with 100% service tax. What should the Service receiver should do?

If the Service receiver pays 100% of service tax leived on the bill. then does it releases the liability of the service receiver under reverse charge mechanism.

Please kindly send me the details

AVTAR SINGH

AVTAR SINGH (Expert)
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16 January 2014 No. Under the Reverse Charge Mechanism, the service tax has to be deposited by the Service Receiver.

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Ganeshbabu K

Ganeshbabu K (Expert)
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16 January 2014 Legal liability is of service receiver. That liability does not disappear even assuming that the service provider has paid the service tax. The department can insist on payment of service tax from you [In respect of past, may be you can get away by claiming that it is only procedural mistake and no revenue loss. However, for future, please do not do it].

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Ganeshbabu K

Ganeshbabu K (Expert)
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16 January 2014 1)Service provider should charge only his part of service tax

2)Service receiver to pay service tax of his part by GAR-7 challan

3)Service receiver liable for only his part and not entire amount, even if service provider does not charge his portion of service tax.

4)A statutory liability cannot be shifted by mutual agreement. If statutory liability is of service receiver, he alone is liable..

Querist : Anonymous

Querist : Anonymous (Querist)

05 February 2014 I came to know that there have some amendments regarding that & if the provider pays the whole sum then the receiver doesn,t need to pay any part of his own.