M currently doing an audit for a company which processes raw water and sells water cans to customers... For the purpose of sale the company uses several transport agencies to deliver water cans through road transport.. My query is service tax reverse charge mechanism applicable to such transactions? If applicable then at what rate... please help
1 Replies
Harendra Kumar
(Tax Advisor )
(1326 Points)
Replied 28 March 2014
Mam,
You are eligible to pay Service Tax under Reverse Charges Machnasim 100% i.e.
Rs. 100 of 25% = Rs. 25.00 of 12.36% = 3.09 ( payable amt. and also eligible for Cenvat Credit same amt. i.e. 3.09 )
Note
12.36 % means Basic, Ed. Cess & S H Cess
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