arun kumar (accountant) (67 Points)
18 February 2013Dear Friends
am working in manufacturing company, we had labour contract with local service provider, they charge Service Tax @ 12.36% every month, we asked ST Challan so many times, still we r not recieved the Challan. My question is if the contracter not paid S T, wht can we do next because we already cenvat credit taken.
please help me
regards
arun
CA Suri Kota
(Assistant Manager @ EY)
(955 Points)
Replied 18 February 2013
Options:
1. Hold the next payment till you receive the challan
2. Try to get rid of the vendor as it is risky for company to continue in such case.
3. To some extent , You can justify any assessing officer for taking credit as you have already paid the ST amount to the vendor.
This is the reason why reverse charge mechanism came into picture last year.
Manoj Agarwal
(Service Tax Consultant Rourkela ServiceTaxExpert@yahoo.com)
(3456 Points)
Replied 18 February 2013
In case of Manpower supply service, if the service receiver is a body corporate and the service provider is an Individual, proprietorship firm, HUF, partnership firm (including LLP), or AOP, then the liability to pay 75% of service tax is that of the service receiver under reverse charge mechanism vide not. no 30/2012. So, if this is the case, pay only 25% of ST to the labour contractor, and directly deposit 75% of ST to the exchequer after payment to of bill to the service provider (Rule 7 of POTR, 11)
If the labour contractor is not registered under the Act, then don't pay any tax to him.
tax2001-it @ yahoo.com
CA Sanjay Bag
(CHARTERED ACCOUNTANT)
(3340 Points)
Replied 19 February 2013
CAclubindia
