Swami Ayyappa Nuli (TAX ADVISOR & CONSULTANT AT G.S.T SUVIDHA CENTER) (1372 Points)
26 June 2013Our client is paying frieght to a goods transpot agency,is our client is liable to pay service tax on reverse charge mechanism.
our client is manufacturing of yarn,spinning mill,is there any exception to the aforesaid case by virtue of spinning mill.
our client is company(pvt ltd) and consignor is also a company
pls clarify it quick.
thank you
Sonam Bidasaria
(CA)
(770 Points)
Replied 26 June 2013
Your client is liable to pay service tax on 25% of the total gross amount under reverse charge mechanism, if ALL the following conditions are satisfied :
1. If gross amount charged on a consignment transported in a single goods carriage is or exceeds one thousand five hundred rupees
2. If the the goods transport agency in the consignment note issued makes a declaration that neither credit on inputs or capital goods [now input services also] used for provision of service has been taken nor the benefit of Notification no. 12/2003-Service Tax has been taken by them.
Further, exemption from payment of service tax on GTA service is provided only in the following cases:
1. Vegetable
2. Fruit
3. Eggs
4. Milk
5. Food Grains and Pulses.
Nirav Worah
(CHARTERED ACCOUNTANT)
(396 Points)
Replied 26 June 2013
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