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Treatemnt of service tax in caseof discount given

P@R@G (Accounts Head & Final CA & CS) (79 Points)

12 July 2012

Dear masters

pls find my quarry below.

1.In case i booked bill for expenses(e.g. telephone bill) than at what time i get input credit..at time of booking or actul payment..

2.in case of sale bill raise and i ddnt received full value bill and not paid service tax on accrual basis...

so i revised invoice amt and show sales as per what amount have received and pay service tax accordinly with int or

put unpaid amt in discount and pay full service tax what i suppose ...

3. same above for purchse

Thanking you

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3 Replies

Ajit kumar Dubey (Taxation Manager) (637 Points)
Replied 12 July 2012

CENVAT credit is allowed at the time of receiving vendor bills, provided that the the bill amount is paid within two months from the date of availing the said credit. Service tax liability is at time of raising invoice and not at the time of receiving payment. Hence, the avenues which you are trying to work out will not be fruitful as if you are caught penalty to the extent of 100% will be imposed upon you. It is advisable for you to pay the interest and tax on the amount of tax defaulted.

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P@R@G (Accounts Head & Final CA & CS) (79 Points)
Replied 12 July 2012

thnx for your reply

i alredy mention after raising invoice will wait for payment and after receiving payment will pay service tax accordingly

but question arise at time of receiving payment ..in case sale value 100000(inlcng st) and receive only 80 k( inclng st) so wot to dowith 20k...treatment pls?

Ajit kumar Dubey (Taxation Manager) (637 Points)
Replied 12 July 2012

there is no provision for waiting. If you wait it will be considered as evasion of tax and all the penal provisions will be applied against you. At the time of raising the final invoice you have to deposit service tax @ 12.36 % on the value of the service, provided that you raise the invoice within 30days of the date of completion of service. If no invoice is raised within the stipulated time, service tax liability will accrue at the date when the service was actually performed. So now the decision is yours.