14 December 2013
A Pvt Ltd Company paying transportation charges for processing of its goods. The company was not aware about the reverse charge applicability on GTA. Now the company wants to pay the service tax under VCES. The questions are: 1)whether the company will have to pay its service tax dues prior to 01.07.2012 or from 01.07.2012 onwards under VCES, 2) Whether Co is liable to pay service tax if the transporter gives a monthly bill of 25 trucks @ 1400 i.e Rs. 35000/-
1. The liability under reverse charge was there from 01.01.2005 in respect of GTA services and not from 01.07.2012. Therefore, the entire tax liability for the period Oct-2007 to Dec-2012 has to be declared under VCES. 2. I suppose, you are referring to the exemption based on the freight charged. In this regard, the exemption granted is as follows.
(i)goods where gross amount charged for the transportation of goods on a consignment transported in a single goods carriage does not exceed one thousand five hundred rupees; or (ii)goods, where gross amount charged for transportation of all such goods for a single consignee in the goods carriage does not exceed rupees seven hundred fifty.
Therefore, in my view, if your case fits into any of the above category, there will be no liability. Otherwise, you will have to pay service tax.
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