Hi everyone,
My client is a callcenter & paying FBT on expenditure of Telephone expenses as bill is coming on his name.But he is saying that such expenditure is on behalf of his client/customer because customer has installed telephone lines at his office
My client is taking the benefit of input credit of such expenditure for service tax purposes.
now he is making his bill on his client like below:
Telephone expense 112000
less : Reversal ofService tax (say) 12000
balance 100000
FBT ( say 6.798%) 6798
total 106798
Service tax @ 12.36% 13200
Total bill amount 119998
My client is showing this much of amount as reimbursement of telephone expenses in the bill
Can any tell me is this correct ? As nothing mentioned anywhere about reimbursement of FBT . And my client is charging service tax on FBT saying that it is part of his total cost .
Is there penalty for this anywhere?
CAclubindia
