Robin (AUDITOR) (854 Points)
07 August 2010Mr. X providing taxable service to Mr. B, and some input services are received from Mr.B to complete the taxable service, further materials are also supplied by Mr.B
Now the issue is how to deal with input service provided by Service Recipient ? and materials supplied by him ? On amount Service tax to be charged ?
Note : Mr.X service provider and Mr. B service recipient
Total amount of invoice 10,000
Input service from Mr.B Rs. 2,000
Material Cost Rs. 3,000
Kumar Gaurav
(Going...to be C.A soon...)
(1624 Points)
Replied 07 August 2010
Mr. X---S.P
Mr. B---S.R
As X is providing taxable services to B so he will charge S.Tax from "B" and further B is also providing the material which is a differ case, hance will be handled seprately. same as input services providing.
Tell me if me wrong please!!!
Robin
(AUDITOR)
(854 Points)
Replied 07 August 2010
| Originally posted by : Kumar Gaurav | ||
 |
Mr. X---S.P Mr. B---S.R As X is providing taxable services to B so he will charge S.Tax from "B" and further B is also providing the material which is a differ case, hance will be handled seprately. same as input services providing. Tell me if me wrong please!!! |
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To the extent of material contract your view holds correct but what about service rendered by Mr.B to Mr.X to complete his own work from Mr.X ?
girish
(article)
(567 Points)
Replied 07 August 2010
Notification No.12/2003
As per the said notification material supplied by Mr.B shall not be considered for service tax purpose assuming in this case that its been exlusively consumed for rendering taxable service by Mr.X
Meanwhile the material supplied by Mr.B will be considered as SALE for this purpose.
Now, As far as service rendered by service recipient to service provider a clarrification is needed from CCI experts !! Not aware of such provision so far !
Guess or opinion does not look good. So lets wait for some other member to clarrify it clearly
Robin
(AUDITOR)
(854 Points)
Replied 08 August 2010
What about service provided by service recipient to service provider now ?
Plzzzzzzzz answer FCA's !!
Darshan
(Manager)
(53 Points)
Replied 08 August 2010
1.Mr. B will charge S.Tax for 2000rs from Mr.A for the input service, subsequently Mr.A will charge S.tax from Mr. B for the service rendered for 10000 rs..it will now have a net effect that Mr. B paid S.tacx only on 8000rs..
after cenvat credit govt get net tax amount as revenue..
Am i correct ??
Robin
(AUDITOR)
(854 Points)
Replied 08 August 2010
| Originally posted by : Sudarsan | ||
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1.Mr. B will charge S.Tax for 2000rs from Mr.A for the input service, subsequently Mr.A will charge S.tax from Mr. B for the service rendered for 10000 rs..it will now have a net effect that Mr. B paid S.tacx only on 8000rs.. after cenvat credit govt get net tax amount as revenue.. Am i correct ?? |
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Sudarshan, material cost will not be included for charging ST as it is shown separately in invoice, If both are charging ST on their respective output service then Govt is collecting double tax on same amount of Rs.2000 ?
Correction in ur answer : Mr. A read as Mr. X
Support answer with any provisions in ST act 1994 or rules made thereunder, instead of guess works !
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