a company earns an income of freight from its customers and pays freight (including service tax) to its supplier , it is not registered in service tax for freight. it earns income in nature of freight which is much more than freight paid to supplier , will it be liable to service tax.
FACTS: A Ltd, Recieves Rs.1.00 lacs for freight plus service tax from its customers for making delivery of its produsts.
A Ltd also pays frieght of Rs.1.50 lacs to transpoter for delivery ofthe above mentioned product to the customer.
Whether it is allowable to pay service tax on net off amount .i.e., (Rs.1.5 - Rs.1.00) Lacs?
Waiting for your prompt response.
FACTS: A Ltd, Recieves Rs.1.00 lacs for freight plus service tax from its customers for making delivery of its produsts.
A Ltd also pays frieght of Rs.1.50 lacs to transpoter for delivery ofthe above mentioned product to the customer.
Whether it is allowable to pay service tax on net off amount .i.e., (Rs.1.5 - Rs.1.00) Lacs?
Waiting for your prompt response.
I my opinion you cant net off the amount. Furtheras the example suggets , i feel you A ltd being service provider should take registrtion and avail Input credits for the ST paid to Transporters
CAclubindia
