Pradeep Jain - Chartered Accountant

Queries

Sir, we are a taxpayer dealing in health care services. We have been making supply on which tax was payable by us but we have not paid the same erroneously. The same has been pointed out by department recently. Please suggest whether we have to pay interest and penalty along with tax. (Posted On: 25 Jun, 2022)

As per sub-section (5) and (6) of Section 73 of CGST Act, if you have made payment of tax and informed the same to the department then the department will not issue show cause notice to you. It makes no difference if the tax has been deposited by you at your own or after pointing out by the department. Hence, penalty will not be payable but the liability of interest will arise.
Sir We are dealing in trucks. We have received an export order from foreign buyer. We wish to procure trucks from 5 different manufacturers and supply them directly to the port without receiving on our own premises. Can we do the same to take benefit of merchant export by paying tax @ 0.1%. (Posted On: 25 Jun, 2022)

. Yes, as per Notification 41/2017-intergrated tax (Rate) dated October 23, 2017, benefit of notification is available only when the material moves from premises of supplier directly to port without bringing it the premises of exporter. Hence, you can take benefit of impugned notification and export the goods without payment of tax under LUT.
The agriculture produce like soyabean are taxable however, their warehousing is exempt and not chargeable to tax. How? (Posted On: 22 Mar, 2022)

Under GST regime, agriculture produce means “any produce out of cultivation of plants and rearing of all life forms of animals except rearing of horses and wherein either no processing is done or such processing is usually done by cultivator. Moreover, as per entry 54(e) of Notification no. 12/2017 exempts loading, unloading, packing, storage or warehousing of agricultural produce. In the given case, soyabean is covered under definition of agriculture produce and hence, its warehousing is exempt and not chargeable to tax. However, it is also taxable at the rate of 5% under HSN 1201. Further, some processing is done to convert the agriculture produce into soyabean. It can happen that a produce is covered under definition of agriculture produce but still remains chargeable to tax. To illustrate, paddy is an agriculture produce but rice is not as some processing is required to convert paddy into rice. Therefore, concluding the above, storage and warehousing of soyabean are not chargeable to tax.
Hello sir we have made export of goods however the funds have not been realized. Is there any implication in GST regarding the same? (Posted On: 21 Mar, 2022)

As per rule 96B introduced with effect from 23-3-2020 provides that where any refund of IGST paid on export of goods has been received by the exporter but the sale proceeds in respect of such export have not been realized within the period allowed under Foreign Exchange Amendment Act including the extension the exporter shall deposit the amount so refunded to the extent of non-realization of sale proceeds along with the applicable refund. The exporter is required to deposit the refund amount within 30 days from the date of expiry of the said period.The Proviso further provides that if RBI has written-off the requirement of realization of sales proceeds, the refund amount shall not be recovered. Further, sub-rule (2) of Rule 96B provides that after the amount has been paid and subsequently the applicant produces evidence of realization of sales proceeds and makes application for refund of the amount, the amount recovered shall be refunded back the applicant.
What Is the GST rate for interest and penal charges levied by Chit Fund Company in case GST on foremen commission charged is @12%? (Posted On: 21 Mar, 2022)

GST rate on foremen commission is charged at the rate of 12%. Similarly, GST rate on interest and penal charges shall be @12% only. The same view was taken by AAAR UP in the case of M/s Ushabala Chits Private Limited .
Tax payer being a company, is in one state (state -1). However vehicle carrying his goods is caught in another state (state-2) where the company is not having any registration. Company paid penalty under temporary registration ID created by the officer of state-2. Now, company wants to file an appeal but don’t have any temporary registration login credentials. How to file appeal in such a case? (Posted On: 21 Mar, 2022)

. In the given query, after the interception a temporary ID was created by officer of state-2. However, the login ID and password of temporary registration are not available with the assessee. In such a scenario, the temporary ID shall also be linked by email and phone number. Further, the PAN is also linked. The assessee can search ID and password, generate OTP and change the password of the ID and then can file the appeal. If in case the assessee is not able to retrieve the login details, the concerned officer is to be contacted who can change/add mobile number for temporary ID. Once the mail or mobile number is updated, a new password can be generated by using forgot password. Further, the assessee can also have an access to temporary ID using Mov-09 challan. That is the way to be adopted by assessee to file an appeal in case he is registered outside the state. However, in case he is registered within the same state, GSTN is to be used.
Whether GST exemption is availed on export of service when invoice is issued in USD and GST is not charged and currency is received in INR? (Posted On: 09 Dec, 2021)

Export of service is defined under section 2(6) of the IGST Act. It means supply of service when: ? The supplier of service is located in India. ? The recipient of service is located outside India ? The place of supply of service is outside India ? The payment of such service has been received by supplier of service in convertible foreign exchange or in Indian rupees wherever permitted by Reserve Bank of India and, ? The supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 of Section 8. In the above query, if the currency is received in INR and it is permitted by Reserve Bank of India (only in case of Nepal and Bhutan) and assuming that all other conditions are fulfilled, the service shall be termed as export of service u/s 2(6) of the IGST Act. Otherwise, it will not be considered as export of service.
E-way bill was generated and then after order was cancelled but E-way bill was not cancelled by both the parties on the portal. What should be done in this case and what are the consequences? (Posted On: 09 Dec, 2021)

As per provisions of GST, where an e-way bill has been generated but goods are either not transported or are not transported as per the details furnished in the e-way bill, the e-way bill may be cancelled electronically on the common portal, either directly or through a Facilitation Centre notified by the Commissioner, within 24 hours of generation of the e-way bill. In the given case, e-way bill was already generated while the order was cancelled. However, the e-way bill was not cancelled by the partied on the portal. There is no legal remedy available in the statue. However, in such a case, we should write a letter to the GST department narrating the complete facts to them. There will be no such consequences taken against both the parties if in case the e-way bill is not cancelled on GST portal. We can either cancel the invoice or we can raise the credit note. Even in the latest GSTR-1 return, this transaction will automatically reflected in the return on the basis of e-way bill.
The Taxpayer made exempted supplies but forgot to choose the same in GSTN while registering, can he be said to fail his right of exemption? (Posted On: 09 Dec, 2021)

We do not claim exemption while filing registration application. It is being claimed in GSTR-3B returns. Moreover, only five major products are to be mentioned while filing application for registration. When we are not declaring list of all the goods and services supplied by us in registration application, hence question of claiming exemption in registration application does not arise.
If a taxpayer made mistake declaring the HSN/SAC of goods and services supplied, what are the consequences? (Posted On: 09 Dec, 2021)

Under GST law, one of the most important elements is the classification of goods/services for the purpose of determination of rate of tax to be levied on them. This depends on the HSN/SAC codes specified under GST Law. Wrong classification of HSN/SAC leads to wrong rate of duty which further leads to wrong payment of taxes. Following are the consequences: ? GST charged at higher rates- This leads to loss of creditability, loss of customer base and incurring unavoidable loss on account of discounts given to customers. ? GST charged at lower rates- This leads to loss of non-recovery of tax, interest and penalties from customers. Department will ask for differential tax amount and buyer will not be there to reimburse the same. ? Wrong exemption claimed- This result in loss of non-availment of input tax credit. We have to pay the tax at a later date and credit will not be available due to Section 16 of CGST Act, 2017. ? Non-payment/ unnecessary payment of tax. ? Wrong classification of goods/ services leads to denial of export/import exemption under Foreign Trade Policy such as duty drawback, incentives etc. ? Penalty of INR 50,000/- (INR 25,000/- each for CGST and SGST) can be levied for non-mentioning or mentioning wrong HSN/ SAC Code under Section 125 of the Central Goods and Services Tax Act, 2017 These were some of the consequences of declaring wrong HSN/SAC.
Mr. A is situated outside India and Mr. B is giving business promotion/ market research services to him, is this intermediary service under GST? (Posted On: 06 Dec, 2021)

Section 2(13) of IGST Act defines Intermediary Services as: “Intermediary means a broker, an agent or any other person, by whatever name called, who arranges or facilitates the supply of goods or services or both, or securities, between two or more persons, but does not include a person who supplies such goods or services or both or securities on his own account” As per the definition, intermediary is someone who arranges or facilitates supply of goods, services or securities between two or more person. The arrangement requires a minimum of three parties, two of them transacting the main supply and one arranging the main supply. It thus implies that where a person supplies the main supply either fully or partly, on principal to principal basis, the supply cannot be covered under scope of “intermediary”. In the given case, Mr. B is giving business promotion/ market research services to Mr. A who is situated outside India. The said services are being provided as main supply and not as intermediary. Therefore, the above services are not covered as intermediary services under GST.
We have purchased some goods and made payment earlier than the due date of payment. The supplier has given us interest for the early payment. Whether such interest received by the assessee for early payment shall be treated as cash discount? (Posted On: 06 Dec, 2021)

As per Section 15(2)(d) of CGST Act, 2017, in case of delay in payment of interest, late fee, penalties etc. it shall be included in the value of supply. As per Section 15(3) of CGST Act, 2017, The value of supply shall not include any discount which is given:- a) Any discount is given before or at the time of supply – Deductible from value. b) Any discount is given after supply Agreed at the time of supply or before supply – Deduction allowed if – ?Linked to the Invoice ? ITC Reversed by the recipient. c) Not agreed at the time of supply or before supply – Not Deductible from value. In the given query, the assessee purchased goods and made early payment of the same. The interest on early payment does not attract levy of GST while interest on delay payment is included in value of GST as per Section 15 of the CGST Act, 2017. In this case it will not be considered as cash discount but interest on early payment. Hence, in our opinion, the given transaction does not attract levy of GST. The views of our readers are welcome on this topic.
In reference the query no. 4313 , if the goods are replaced during warranty period, whether input tax credit can be available to the assessee? (Posted On: 06 Dec, 2021)

Section 17(5) deals with blocked credit in GST. As per the said Section, input tax credit shall not be available in respect of goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples. Free supplies refer to offering additional products and not the original products being replaced or repaired. In the given query, the goods which are within warranty period and are being replaced by the assessee cannot be termed as sent as free samples. They are replaced goods and not free samples. Hence, Input Tax Credit shall be available in the given case. Even if goods are sent after warranty period and are repaired, in that case also input tax credit shall be available.
We have sent some goods to job worker. Out of them some of the goods were found to be defective which were within warranty period and were returned back to us. Does this attract levy of GST? (Posted On: 06 Dec, 2021)

Section 2(68) of the CGST Act, 2017 defines job work as any treatment or process undertaken by a person on goods belonging to another registered person. The one who does the said job would be termed as “job worker”. The inputs or capital goods shall be sent to the job worker under the cover of a challan issued by the principal as per Section 143 of CGST Act, 2017. The challan shall contain the details as specified in CGST Rules, 2017. In the given query, goods were sent to job worker under cover of a challan which were later found to be defective. The goods returned were within warranty period can either be repaired or replaced. There is no charge for repairs and for replacement also, no GST shall be charged. If the goods were returned beyond the warranty period, then in that case, either goods will be repaired or are returned without repairing. In case, goods returned after repairing then repairing charges would be collected. In case of return of goods as such, no charges will be charged. The complete goods will be sent back along with the delivery challan to the said dealer.
we exported some goods which were later found to be defective and hence, hired someone to do jobbing on the same. The bill for the same was raised in dollars. Does this amount to GST on import of services? (Posted On: 06 Dec, 2021)

Section 2(11) of IGST Act defines Import of Services as follows: Import of services means the supply of any service where- (i) The supplier of service is located outside (ii) The recipient of service is located in India; and (iii) The place of supply of service is in India; As per Section 13 of IGST Act, where the services are performed by the supplier of services on the goods that are made available by the recipient of services or any person acting on his behalf, then the place of supply where the services are performed. In the given case mentioned in the above query, the supplier is located outside India; the recipient is located in India. However, the place of supply shall be outside India which does not satisfy the above definition of Import of Service. Hence, applying the above provisions, it is not import of service and GST shall not be applicable in the given situation.
A partnership firm is providing training/educational services to Autistic children. Is GST applicable on this service? (Posted On: 15 Oct, 2021)

The exemption notification no. 12/2017-CT dt. 28/06/2017, exempts various educational services. The same also exempts educational services provided by Educational Institutions run by Charitable Organizations”, registered under Income Tax Act, the above firm if registered under charitable trust, do qualifies for GST exemption.
Can we claim TCS of any previous year or is there any late fee for the same. (Posted On: 15 Oct, 2021)

TDS/TCS credit received tab auto-populates details from GSTR 7 or GSTR 8 filed by deductor/collector respectively. It is very important for the deductee to cross check these details with his records or bills raised and accordingly accept/reject the record. Once ‘TDS/TCS Credit received’ is filed on the GST portal, a person cannot undo the action (accept to reject or reject to accept). You cannot file the ‘TDS and TCS Credit received’ form without taking action on all the auto-populated records in all tables. Also, there is no due date or late filing fees for filing TDS/TCS credit received.
Assessee is seller of unbranded paneer and cream. As per GST rules, the GST rate for paneer, milk and cream are nil rated. So, assessee file GST returns as nil rated items. But the company from which it buys paneer is charging 5% GST, what are GST implications? (Posted On: 15 Oct, 2021)

As per chapter 4 Chena or paneer put up in unit container and bearing a registered brand name is taxable at the rate of 5%. Other than the above mentioned the same is taxable at nil rate. Thus if the paneer is sold under brand name of company, the same is taxable at the rate of 5%. Even if you are trading paneer having a brand name, 5% GST is payable.
Is there any mandatory requirement to mention every additional place of business in registration certificate? (Posted On: 15 Oct, 2021)

As per Section 2(85): place of business includes, (a) a place from where the business is ordinarily carried on, and includes a warehouse, a godown or any other place where a taxable person stores his goods, supplies or receives goods or services or both; or (b) a place where a taxable person maintains his books of account; or (c) a place where a taxable person is engaged in business through an agent, by whatever name called. Also, Section 28 read with rule 19 requires approval of the Proper Officer is required where the change relates to address of the principal place of business or any additional place(s) of business. Hence, it implies that additional place of business is to be mentioned in registration certificate.
There are two sister concerns A and B. The order came to A but goods are lying with B? How the transaction will take place? (Posted On: 14 Oct, 2021)

Firstly goods should be billed by B to A and then A will issue invoice to customer. Alternatively, “bill to and ship to” model can be adopted by B to send the goods. It will be billed to A and shipped to customer. Yet another option is to send goods under invoice of A from premises of B. E-way should mention that goods are being removed from premises to B and going to customer. Later on, B can issue invoice to A without e-way bill. But B should mention that goods are despatched under invoice and e-way bill of A.
Will the payments made to Film editor, Asst Director come under RCM? or only Artist, music director, writer alone will come under RCM.? (Posted On: 14 Oct, 2021)

Notification No. 6/2019- CT (Rate) w.e.f. 01-04-2019 prescribes Copyright services by a music composer, photographer, artist or like relating to original dramatic, musical or artistic works to a music company, producer or the like to be covered under RCM. Since the services of editor and director does not falls under dramatic, musical or artistic work, therefore, same cannot be taxed under RCM.
Insurance agent gives agency services to insurance company. He charges commission from company say Rs 100000. But out of Rs. 18000 GST which is payable by insurance company under RCM, the company deducts Rs. 11000 from the commission of agent. Also during the payment of commission to agent company deducts TDS as per applicable rate. How the transaction will be recorded in agent books? (Posted On: 14 Oct, 2021)

As the TDS has been deducted on 100000, hence the income through transaction has been reported already as 100000 in income tax portal. The income in books will be recorded at Rupees one lakh. The deduction from commission will not have any effect on GST. The taxpayer can upload the bill in GSTR-1 but also mention that GST is payable under RCM by recipient
Is there any requirement to issue e-way bill in case the goods are transported through railways? (Posted On: 14 Oct, 2021)

When the goods are transported through rail, the goods should come to railway station from the premises of taxpayer. Normally, these come through road only and e-way bill is generated. After generation of Railway receipt, e-way bill is to be updated with RR by taxpayer or his agent. Railways need to carry invoice only and e-way bill will not be carried along with goods. But on delivery of goods, e-way bill has to be produced before railway authorities.
In Department Audit officers got paid the ITC not reflected in 2A which the assessee paid. DRC03 was made u/s 73. Now department is pressurizing to pay 15 % penalty. Is the same tenable? (Posted On: 13 Oct, 2021)

The incidence of short payment of tax or erroneous refund or wrong availment or utilization of input tax credit may be due to inadvertent bona fide mistake is covered u/s 73 of CGST Act, 2017. Cases of fraud or suppression with deliberate attempt to evade are covered under section 74 ibid. Since, nature of offence is different, separate penalty provision made for such type of cases. In case the payment was done before issuance of SCN and that too under section 73, no penalty can be levied and the above action is not tenable.
?????? ???? ???? ?? ????? ?? ????? ??? ?? ???? E ?? ??? ????? ?????? ??? ???? ??? ??? ???? ????????? ??? (Posted On: 13 Oct, 2021)

GST ???? ??? ??? ??? ???????? ???? ?? ????? ?-?? ??? ????? ?? ??? ??? ???? ?? ?? ??? ??? ?? ?? ??? ?? movement ???? ?? ?? ?? e-way bill GENERATE ?? ???? ??? ?????? ??? ASSESSEE ?-?????? ???? ?? ?? ??? ?-?????? ????? ?? 48 ???? ?? ???? ?-?? ??? ????? ???? ?????? ?????? ???? ??? ????? ?? permission ???? ?????
What would be the GST rate for sale of old unused Tanker Lorry as scrap (whose RC has been surrendered at RTO). Would it still be the rate as applicable to Lorry or would it be the rate as applicable to iron and steel. (Posted On: 13 Oct, 2021)

Since the registration of vehicle has been surrendered in RTO office, thus it ceases to qualify motor vehicle under Motor Vehicle Act, 1998. The same would be supplied as scrap at the applicable GST rate on iron and steel scrap.
Assessee has filed GSTR 7 by accepting the TCS credit. Now assessee realizes that the credit was wrongly posted in their GST NO. Can the same be amended? (Posted On: 13 Oct, 2021)

No such provision exits in GST law. The same can only be reversed vide DRC 03.
Q.5 ?? ????? -2021 GSTR -3b RETURN ???? ??????? ????????? ?? CASH liability ?? payment ?? ??? ?? ???? ????????? ?????? ???????? ?? ???? ?? gst site ??technical problem ?????? ????? payment GST portal ?? show ?? ???? ??? ?? ?? ?? ???? ?? ???? gst return 20 -09 -2021 ?? ?? ?? ?? ???? ????? CASH ???????? ?? ?????????? ? ???? ????? ?? ??, ???? ????GST ??????? ?? ???????? ?????? ?? interest ?? payment ???? ????? ? (Posted On: 25 Sep, 2021)

Q.5 ?? ????? -2021 GSTR -3b RETURN ???? ??????? ????????? ?? CASH liability ?? payment ?? ??? ?? ???? ????????? ?????? ???????? ?? ???? ?? gst site ??technical problem ?????? ????? payment GST portal ?? show ?? ???? ??? ?? ?? ?? ???? ?? ???? gst return 20 -09 -2021 ?? ?? ?? ?? ???? ????? CASH ???????? ?? ?????????? ? ???? ????? ?? ??, ???? ????GST ??????? ?? ???????? ?????? ?? interest ?? payment ???? ????? ?
Q-4 ?? ?? Government ?? ?? goods ?????? ???? ???? ????? ??? TCS ?? balance IGST ??CASH ledger?????? ???? ?? ?? ????????? ???? ??? ?????? ???? ?? CGST ?? SGST ??? CASH ???????? ?? ?????????? ??? ???? ???? ?? TCS ???? IGST ?? amount CGST ?? SGST ??CASH payment ???????use ?? ???????? (Posted On: 25 Sep, 2021)

Ans. ? ???? IGST ?? CASH ledger ?????? amount ?? CGST ?? SGST ?? payment ???????use ?? ??????? ???? ??? ???? FORM PMT -09 ? ?? ??? ???? ? ?? ???? ?? ??????? IGST ?? balance ?? CGST ?? SGST ????? ????? ?? ??????? ?? ???? ????? CGST?? SGST ?? payment liability ? ? ? ??? ? ?? ? ???? ?
Q-3 If we trade only in exempted GST items (say Guar Churi korma) then whether it is necessary to register for GST, if the turnover exceeds ?20 lacs? (Posted On: 25 Sep, 2021)

Ans. A person dealing with 100% exempted supply is not liable to register irrespective of turnover.
Q-2 ??, ?? exempted products supply ???????????????????????? ??????? ?????????? exempted???? ???? ???????????????? ?? RCM ??? ?????? ???? ?? ?? ?? exempt ???? ???? ??? (Posted On: 25 Sep, 2021)

Ans ??? ??????????? exempt ???? RCM transportation services ?? GST exemption ??? ???? ?? ???? ??????????? notification 12/2017 ??? ??? 28.06.2017???????? ????? 21 ???????? ? ??? ??????? ?? ??? ?? exemption ?? ????? ???? GST ? ? ? ??? ? ??? ????? ?
Q-1 ?? ?? ?????????????? ?????? ?? RCM ??? ?????????? ??? ?????????????? ?? ????????????? ??????? ?????? ?? ?? RCM ??? ?? ?????????????? ?????? ?? RCM ??? ?????? ????? ?? ?? ??? (Posted On: 25 Sep, 2021)

Ans. NOTIFICATION 12/2017- CENTRAL TAX (RATE) ??? ??? 28.06.2017 ??CLAUSE (ze) ?? ???????? “?? ???? ?? ??????????? ??????” ?? ???? ? ?? ??? ???????????????? ??? ?? ??? ??? ???? ???? ???????? ????? ??? ???? ??????? ????? ???? ?? ??????????????? ? ? ? ???? ? ????????? FLYER 38 DATED 1.1.2018 ?? ? ? ?? ?? INDIVIDUAL TRUCK OWNERS ?? ?? CONSIGNMENT NOTE ? ?? ????? ????????? ???????? ?? ? ??????????????????? ???????????? ??????? ?? ?? ? ???M/S ??? ? ??? ?? ???? ????? ?????????? ????? ? ? ? ? ? ?????? ?? DECISION ??? ? ?? ???? ????????????? ??? ???? ?????????? ?? ???? ???????? ????? ?? ? ? ?? ???? GTA ?????? ?? RCM ?? ??? ? ?? ???? ? ???????? ????? AAR ? ???? ? ??M/S. K.M. TRANS LOGISTICS PRIVATE LIMITED ?? ?? ? ????? ?????? ??? ? ?? GTA ?????? ??? ???? ? ?? ?? ??? ?? ?? ??? ?? ??? ? ???????? ????? ????? ?? ?? ?? ?? ????????????? ?????? ??????
Assessee wants to file application of revocation of cancellation of GST registration for period commencing from 2018, is the same possible? (Posted On: 22 Sep, 2021)

As per recent circular number 158/14/2021-GST dated 6TH Sep 21, revocation application can be filed if cancellation was done by department during the period from March 2020 to September 30, 2021. But your period falls outside the same. Now the option remains with us is to file appeal. But again, the appeal can be filed within 3 months of the order as per CGST Act, 2017 and condonation can be filed for one more month. Moreover, the Apex Court decision in case of Hon’ble Supreme Court Order dated 27.04.2021 in Miscellaneous Application No. 665/2021 in SMW(C) No. 3/2020 under the GST law and subsequent circular number 157/13/2021-GST dated 20th July 2021 issued by CBIC based on impugned decision has held that the period for filing of appeal is falling in the period from Mach 2020 onwards then it is not time barred. But your period can fall outside the same. Hence, appeal is also time barred. Thus, there seems to be no remedy except to apply for fresh registration.
1.Assessee runs a hotel for which the base fare/tariff per room is greater than Rs 1000/day, on which GST was charged and paid. Now in COVID period, due to non-occupancy, tariff was reduced to 900 per room per day making the supplies exempt. What will be implications as per GST law? (Posted On: 22 Sep, 2021)

Rule 42 of CGST act 2017 prescribes reversal of input credit in case of both exempted supply and taxable supply. Since in above case during the year the exempted supply was made therefore proportionate reversal will be made monthly and finally be reconciled on annual basis.
A labour contractor is unregistered and has provided services to us in year 2018-19. The department audit is asking to pay GST on the same under reverse charge mechanism. Whether we have to pay the same? (Posted On: 20 Aug, 2021)

The Reverse charge mechanism is not applicable on labour contractor in year 2018-19. The reverse charge from unregistered to registered is applicable only in part of year of 2017-18. Hence, the audit para raised by the audit party is not tenable.
The partner of a concern is hospitalised and cannot work as well as in position to talk. The other partner intends to sale the goods from his business premises but e-mail user name and id is not available with him. The goods are to be sent urgently. What is remedy available? (Posted On: 20 Aug, 2021)

The recipient of goods can raise the e-way bill and material can move with this e-way bill. Later on, invoice can be raised by supplier of goods.
We intend to purchase goods in name of our sister concern at Indore and delivery be given at our manufacturing unit at Chennai. Whether it can be done? (Posted On: 20 Aug, 2021)

Yes, you can do it by Bill to Ship to model. The bill will be raised in the name of sister concern at Indore and delivery will be done at Chennai. Even the e-way bill will be raised in the same fashion by supplier of goods.
We are going to purchase a car for business of textiles. Whether we can take the credit on the same? (Posted On: 20 Aug, 2021)

Section 17(5)(a) of CGST Act, 2017 allows credit on motor vehicle having seating capacity of more than 13 persons. However, in case of other motor vehicle, the credit is allowed only when the person is engaged in further supply of motor vehicle or transportation of passengers or engaged in imparting training of driving such vehicle. But you are engaged in business of textiles, hence the credit of the same will not be allowed to you.
???? B2C ?????? ?? ??? ?? e-inovice ????? ????? ??? (Posted On: 19 Aug, 2021)

????, B2C SUPPLIES ?? ??? E-INVOICE ????? 1.12.2021 ?? ????? ???? ??? NOTIFICATION NUMBER 28/2021- CENTRAL TAX DT. 30.6.2021 ?? ?? ??? ??? ?? ?? ?????????? 14/2020 ?? NON-COMPLIANCE ?? ???? ???? ??????? ?? ??? 1.12.2021 ?? ??????
Sir, Whether any prior intimation is required before conducting the audit by GST Department? (Posted On: 19 Aug, 2021)

Yes, prior intimation is required and the taxable person should be informed at least 15 working days prior to conduct of audit.
Sir We are job worker and providing service of annealing and prickling of S.S. Round. Are we liable to take registration for the same? (Posted On: 19 Aug, 2021)

No, a Job worker is a supplier of services and will be obliged to take registration only when his turnover crosses the prescribed threshold of Rs. 20 Lakhs.
?? ???? GST ??????????? 2019-20 ??? ????? ????? ??? cancel ?? ??? ?? ???? ??? GSTR -9 return ???? ?? ???? ??? ? (Posted On: 19 Aug, 2021)

??? Section 44 (1 ) of CGST Act ?? ?????? ?? registered person ?? ???? GSTR -9 return ???? ???????? ??? ???? ???? ??????????? ?????? ?? ??? ?? ?? ?? 2019 -20 ??? ?? ????????? ?? ?? ???? ???? GSTR -9 return ???? ???? ?? ?????
Sir We have purchased Capital goods in 2018 and took ITC on the same. Now we are going to sale that capital goods in 2021. Can you guide us as to how to calculate the output tax liability on the same? (Posted On: 19 Aug, 2021)

Section 18(6)of CGST Act, 2017 provides for supply of capital goods on which credit is taken. It provides that the taxpayer shall pay an amount equal to input tax credit taken on such capital goods reduced by such percentage points as amy be prescribed or the tax on transaction value of such capital goods as determined under Section 15 ibid. Rule 44(6) of CGST Rules, 2017 the amount of input tax credit will be calculated as prescribed under sub-rule (1)(b) of Rule 44ibid. This Rule says that input tax credit involved in remaining useful life in months shall be computed on pro rata basis. The useful life of capital goods is to be taken as five years.
?? ?? ????? ????? ?? ???? ???? GST ?? ??????????? ???? ???????? ?? ?? ????? turnover limit ??? 20 ??? ?? ?????? ???? ?? ?? ???? ??????????? ???? ?? ????? ???? ?? ? (Posted On: 19 Aug, 2021)

GST ?? registration .??? ??? ?? ??? ?????? ???? ?? ?? behalf ?? agent ?? ??? ???? ?? ?? ???? ??????????? ???? ???????? ?? ???? ???? turnover ????? ?? ??? ?? ??? ??? turnover ?? ????? ???? ???? ???? ?? ???? ??????????? ???? ?? ?????
?? ???? exempted Goods ?? ????? ?? ?? ?? ?? ?? ???? brand name ?? sale ???? ?? ???? ???? GST ?? registration ???? ???????? ?? ? (Posted On: 19 Aug, 2021)

??? ?? ???? exempted Goods ?? ????? ?? ??? ?? taxable product ???? ????? ?? ?? ??? ???? ??????????? ???? ?? ??? ????? ???? ??? Branded goods ???? ?? ??? ???? ???? ????? ???
?? ?? ?????????? ?? ?? ????????? ?? ??? ?? ????? ??? ????? ??????? ?? ????? ?? ?????? ???? ??? ???? ???? ?? ?? ??? ??? ???? ?? ?????? ???? ?????? (Posted On: 19 Aug, 2021)

??? ??? ?????? Exporter (?????? ????? ?????) ?? ????? ?? ?????? ???? ??, ?? ?? ?????? ?? ?????? ???? ?? ??? ????????? ???? ?? ??????? Place of Supply ???? ?? ???? ??? import of service ?? ??? service ???? ???? ???? ??? ??? service ???? ???? ???? ?? ???? ???? ?? ???-??? place of supply ???? ?? ???? ???? ?????? ????? ?? ??????? ??? ?????? ???? ?? ??? ?? ?? ?????? ???? ??????
?? ?? ?? LUT ??? ????? ????? ???? ???? ??? ?? ????????? ?? turnover ???? ????? ?? ???? ?? FOB Value ?? ??? CIF Value ? (Posted On: 19 Aug, 2021)

Section 15 of CGST Act, 2017 ??? ?? ???? ?? ?? Value of goods ???? ??? ??? ????? ???? insurance ?? freight ?? ????? ???? ?? ???? CIF ?????? ?? reflect ???? ??? Section 2(30) 30 ??? ?? ?? Composite supply ?? ??????? ??? ?? insurance ?? freight ?? value of supply ??? ???????? ???? ??? ????? section 89(4) ??? ??? ?? ???????? ??? value of turnover of zero rated supply ??? Section 15 ?? ?????? ?? ???? ?
?? ???? GST ??? ??? ?????? ?? Gross value ?? ???????? ?? ?????? ???? ?? Govt ?? ??? ??? clarify ???? ?? ?? ????? liability net value ?? ?? ???? ?? ?? ???? ???? ?? excess interest ?? ?????? ???? ?? ???? ????? ???? ??? ?????? ? (Posted On: 12 Aug, 2021)

As per Notification No. 63/2020-Central Tax, dated. 25th August, 2020. ??? ?????? ?? GST ?? ??? ??? ???????? ?? liability ??? amount ?? ?? ???? ?? ??? ???? gross amount ?? ???????? ?? ?????? ???? ?? ?? ???? ???????? ?? Differential ?????? ?? ????? ??????????? ?? ??? ???????
?? ???? ???? sister concern ?? ??? ???? ?? ??? ??? ????? ?? ???? ???? compliance ???? ???? ????? ? (Posted On: 12 Aug, 2021)

???? CGST ACT 2017 ?? Section 143 ?? ?????? ??? ???? ?? ??? ????? ????? ???? ?? ????? ?? ??? ?? ???? ??? ??? ???? ?? ??? ???? sister concern ?? ????? ????? ?? ???? ??? ???? quarterly return ITC-04 ?? ???? ???? ??????
?? ???? ?? ???? rent ?? ?? ??? ?? ???? ??? ??? ??? ?? ??? ?? ???? ???? ?????? ?????? ???? ??????????? ?? ?? ??? ???? ???? ???? ?? ?? ITC ?????? ? (Posted On: 12 Aug, 2021)

As Per Section 16 of CGST Act, 2017 ????????? ?? ??? ???? ??? ?? ?? ?? ?? ?????? ???? ??? furtherance of business ??? ?? ??? ? ??? ?? ????? ???? repairing service ?? ??????? ??? ?????? ???????? ?? capital expenditure ?? ??????? ???? ????? ??? ????? ???? ???? rent ?? ?? ??? ?? ?? ?????? ??????????? ???? ?? ???? ???
?? ???? ???????? ????? ?? ????????? ?? ??? ??? ??? ?? ??? ??? ???? ?????????? ???? ????? ????? ???? ???? ???? ???? ?? ???? ???? ???? ?? ??? ?? ??? ???? ?? ????? ????? ???? ?? ? (Posted On: 12 Aug, 2021)

???? ???? ???????? ?? ?? ?? ???? ???????? ?? ??? ????? ?? ???? ??? ???? ??? ???? ?? ????? section 143 of CGST Act, 2017 ?? ?????? ????? ???????? ??? ?? ???? ??? quarterly return ITC-04 ?? ???? ???? ??????
?? ???? ????? ???????? ??? ???? ????? ????? ?? ???? ???? ???? ITC ?????? ? (Posted On: 12 Aug, 2021)

??? ???? ???????? ??? ????? ?? ??? ???? ???? ????? ?????? ???? ??????? ??????? ?? ????? during the course of business ???? ????? ??? ?? ?? credit ??????
?? ?? ?? ?? ?? ???? ??? ?? zomato ?? swiggy ?? ???? ?????? ?????? ?? ???? ???? ???? ??? GST ?? ??????????? ???? ?? ?? ???? ???? composition scheme ??? registration ???? ???? ?? Normal ????? ??? ? (Posted On: 12 Aug, 2021)

??? ?? online portal ?? ?????? ??????? ???? ??? ?? ???? GST ??????????? ???? ???????? ??? ???? ???? ??? 5% GST without ITC ????? ??? ?? GST ???? ????? ????? ???? ???? ?????? ?????? ?? 5% GST ?? payment ???? ???? ?? ???? ???? inputs ?? input service ?? ITC ???? ??????? ?? ???????? ????? ??? ???? ?? ???? ????
???? 2018 -19 ?? 2019- 2020 ?? ??????? ????? 2020 -21 ?? Annual return ??? Adjust ?? ???? ??? ?? ???? ? (Posted On: 12 Aug, 2021)

Ans ????, ?? Section 16(4) of CGST, 2017 ?? ?????? 2018 -19 ?? 2019 -20 ?? ??????? ????? ?? Subsequent year ?? Sept month ?? ?? adjust ?? ???? ??????? ??? ???? adjust ?? ???? ?
?? ???? ???? ?? 2017 -18 ??? ?????? GST ??? ???? ?? ?? ?? ???? ???? 2018 -19 ??? ?? Excess payment ?? ?????? ?? ???? ??? ? (Posted On: 12 Aug, 2021)

??? ???? ?? GST ?? amount 17 -18 ??? excess payment ?? ???? ?? ???? adjustment ?? ???? ??? ?? ??????? month ?? ?? ???? ???
??? ?? ?? QUERY ????? ??? ???? 2 Lakh ????? 2019 -20 ??? use ?? ??? ?? AUG 2019 -20 ???? ITC ?? Balance 5 Lakhs ?? ?????? ?? ??? ?? ?? ???? ???????? ???? ????? ?? ???? ? (Posted On: 12 Aug, 2021)

?? ??? ???? ?? ???? ??? ?? ???? July 2019 -20 ??? 2 Lakhs ?? ITC ??? ?? ?? ?? ?? ???? 2 Lakhs ?? ????? 2019 -20 ?? ???? ?? ?? ?? ???????? ???? ??????
??? ???? ????? 2018 ??? 5 Lakhs ??????? ??? ?? ?? ?? ???? ?? August 2021 ??? ?????? ???? ?? ?? ????? ?????? ?? ?? ??? 5 Lakhs ?? ?????? ?? ?? ???? ???? interest ?? payment ???? ????? ? (Posted On: 12 Aug, 2021)

??? ???? Balance ????? 2018-19 ?? ???? August 2021 ?? ???? ?????? ??????? ITC ?? Balance 5 Lakhs ?? ?? ?? ?????? ?? ?? ???? interest ???? ???? ????? ??????? Section 73(1) ??? Section 74(1) of CGST Act, 2017 ??? ?? ?????? ?? ?????? “input tax credit taken or utilised” ???? ?? ??? ??????????? ?? ???? ?? ?? ??????? ???? ???? ??? ?? ?? utilise ???? ??? ?? ?? ????? ???? ????? ???? ??? ??????????? ??????? ????? ?? INDS SWIFT LABORTORIES LIMITED ?? CASE ?? ???? ????? ??? ????? ??????? ???????? ?? ???? ?????? ??? ?? ??? ?????? ??? ??? ?? ?? ?????? ??:- a. M/S F1 AUTO COMPONENTS PVT. LTD. [W.P. NO. 6631 OF 2021] b. MAANSAROVAR MOTORS PRIVATE LIMITED VS THE ASSISTANT COMMISSIONER, POONAMALLEE DIVISION, CHENNAI [W.P. NO. 28437 OF 2019] c. M/S COMMERCIAL STEEL ENGINEERING VS STATE OF BIHAR [W.P. NO. 2125 OF 2019] ?? ???????? ?? ???????? ?? ??? ?? ???? ?? ?? ????? ??????? UTILISE ???? ?? ?? ?????? ?? ?? ???? ?? UPDATE ?? ????? ?? ?? ?? ????? website par ????? 06-08-2021 ?? ?????? ??? ??
????? parnership firm ?? ???? ?? ????? partnership Firm ?? ??? ?? ????? ???? ?? trade name ?? GST ?? ??????????? ?? ???? ?? ???? GST ??????????? ??? ????????? ????? ??? Trade Name ????? PAN CARD ?? ??? ???? ????? ?? ? (Posted On: 09 Aug, 2021)

??? ???? ??????????? ?? ?????????? ???? ?? ??? ?? ?? ???? ???? ?????? ?? ???? ???? ?? ????? ??? ??? ?? ???? ??? GST ??????????? ????? ??? ????? ??? ?? ??? ??? ?? ?? ???? ???? ???? ??? ?????? ?? ???? Trade Name ?? ??? ?? document ??? ???? ??? ???? ??????,???? ?? ?? ?? ??? ?? ???? ????? ??? ?? ??? ???? partnership Firm ?? ??? ?? ????? ???????? ?? ?????? ?? ??? ?? ??? ???? Partnership Firm ?? ??? ABC Corp ?? ?? ????? ??? XYZ ?? ?? ???? XYZ ( A Unit of ABC firm ) ?? ??? ?? Trade Name ????? ????? ????? opinion ??? ???? xyz (A unit of ABC firm) ?? ??? ?? ?? ??????????? ???? ??????
?? ???? ????? raw material ????? ?? ???? ??????? ?? ???? ??? e invoice ?? ??? ?? normal tax invoice ??? ???? ????? ??????? e -invoice ?????? ?? ???? ???????? problem ?? ???? e -invoice ???? ??? ????, ???? ?? raw material ?? ITC ??? ????? ? (Posted On: 09 Aug, 2021)

??????????? ?? ???? ?? ?? ??? ???? ??????? e-invoice ???? ???? ?? ?? ???? ?? ??? ?? ITC ???? ??? ??????? ????? ?? ????? ??? ??????? ????? ?? ??? ???? ????? ??? ?? ??????? ?? substantive right ????????? ?? technical breaches ?? ???? ???? ?? ???? ???
?? ??? ?? ????? ??? ????? ??? ????????? ???? ??? ?? ?????????????? ?? expense ????? ?? ??????????? ?? ?? ?? ???? ?? ?? ?? ?? CGST / SGST ????? ?? IGST ????? ? (Posted On: 09 Aug, 2021)

Section 12 (8 ) of IGST Act, 2017 ?? proviso ?? ?????? ?? transportation of goods ???? ?? ???? ???? ?? ?? Place of Supply place of destination of goods ?? ????? ?? ?????? ??? ?? ????? ?? ?????? place of supply ????? ?? ????? location of supplier ???? ??? ?? ??? place of supply ????? ?? ?? ?? interstate ?????? ?? ???? ????? ?? ?? ?? IGST ?? ??????
????? ??? ???? ?? ?? ??? ?? ?? ?? ???? ?? ????????? ?? ??? ?? ???? ??? destroy ?? ??? ?? supply ?? ??????? ??? ???? ??????? ??? ??? ?? ???? ???? ???? ????? ????? ?? input tax credit ?? reversal ???? ???? ?? ???? ???? insurance ????? ??? GST ?? claim ??????? (Posted On: 09 Aug, 2021)

???? CGST Act, 2017 ?? Section 17 (5 )( h) ?? ?????? destroy ??? Finished goods ??? ?? ?? raw material ??? ?? ???? ITC reverse ???? ?????? ?? ??? ???? ???? ???? Basic Value ?? insurance ?????? ?? ?? ???? basic ?????? ?? ?? ????? ??????, GST ?? ????? ?????????? claim ???? ????? ?? ?????? ??? ?? ??????? reversal ???? ?? ?????
Our GST registration was cancelled by the department and we have not filed the revocation application within the 90 days period. How remedy is left with us under GST law? (Posted On: 07 Aug, 2021)

You can file an appeal before your jurisdiction GST office regarding revocation of GST registration explaining your facts to the appellate authority for non-filing of revocation application. Second option is to take a new registration and start business afresh. The department will allow the registration only after old liability is discharged by you.
If we have availed wrong ITC but has not utilized the same. Are we liable to pay interest on the same or not? (Posted On: 07 Aug, 2021)

This is disputed matter. The department contend that Section 73(1) and Section 74(1) uses the words “where input tax credit has been wrongly taken or utilized….”. The Apex Court decided in case of Ind-swift Labortories limited that interest is payable in such cases. This case relates to erstwhile Central Excsie or Service Tax regime. Thereafter, provision under Rule 14 of Cenvat credit Rules, 2004 was amended and wording “taken and utilized” was introduced. But again the same wording of “taken or utilized” has been incorporated in GST Act. Hence, the department say that interest is payable. However, various High Court has given decision in favour of assessee that in case of reversal of unuitlised credit, no interest is payable. Some of these decisions are as under:- a. M/S F1 AUTO COMPONENTS PVT. LTD. [W.P. NO. 6631 OF 2021] b. MAANSAROVAR MOTORS PRIVATE LIMITED VS THE ASSISTANT COMMISSIONER, POONAMALLEE DIVISION, CHENNAI [W.P. NO. 28437 OF 2019] c. M/S COMMERCIAL STEEL ENGINEERING VS STATE OF BIHAR [W.P. NO. 2125 OF 2019]
We have made interstate supply of goods to the registered party in Delhi but due to clerical mistake we have entered this supply in B2C column instead of B2B in GSTR-1 return. In next month, we have nil supply to Delhi. How can I rectify this mistake? (Posted On: 07 Aug, 2021)

You have to show the negative amount in B2C column as well as show the correct particulars under B2B column of GSTR-1.
We have sold a product with warranty. But the product found defective and returned by retailers for exchange. What is the applicability of GST? Should we charge GST on the exchanged product or not? Whether reversal of ITC is to be done? (Posted On: 07 Aug, 2021)

Selling of goods under warranty is a normal business practice. You have already charged GST on your first sale, now you need not to charge GST again on exchanged product. You can send the goods under delivery challan and e-way bill. There is no need of reversal as this is not free samples as mentioned in Section 17(5)(h) of CGST Act, 2017.
In the case of training services, we have seen many Institutes charge CGST/ SGST respectively even if the recipient is a registered person in another State. Ideally it should be IGST and payment is made online. What would be the consequences if incorrect tax is levied? (Posted On: 04 Aug, 2021)

Section 12(5) of the IGST Act provides: “the place of supply of services in relation to training and performance appraisal to,–– a) a registered person, shall be the location of such person; b) a person other than a registered person shall be the location where the services are actually performed.” As such in the instant case the supply of service shall be inter-State [Section-7(3) of IGST Act] and IGST is leviable as per section 5 of the IGST Act. Since the supplier of service has paid tax under wrong head treating the inter-State sales as intra-State, the supplier is required to pay IGST and claim refund of CGST/SGST as per section 77(1) of The CGST Act. Further the supplier will not be required to pay interest while making payment under correct head (Section 77(2) of the CGST Act). As per recent amendments the amount can be transferred to the correct head by filing the prescribed form. This is solely for educational purpose.
When there are exempted, nil rated or zero-rated supplies in our total turnover, why is RCM applicable, even though we are paying GST on the total turnover? (Posted On: 04 Aug, 2021)

The applicability of reverse charge is based on the provisions of section 9(3) and section 9(4) of the CGST Act, / section 5(3) and section 5(4) of the IGST Act, respectively, which mandate the recipient to pay tax under reverse charge on inwards supplies of goods or services or both, received by the registered person (i.e., recipient) on the specific supplies of goods, services or both as notified. Hence, the provisions of reverse charge are not linked to the nature and components of the total turnover.
Whether jeweler made on an order received from customer who also provides old gold ornaments, is a mixed supply or composite supply? (Posted On: 04 Aug, 2021)

It is neither a composite supply nor a mixed supply, because in both the cases, two or more supplies must be involved. As far as supplier is concerned, only one supply is involved i.e. supply of jewelry. In case of exchange of old gold by the customer, it is not a supply by the supplier. However, taxable value must be calculated according to the provisions of Rule 27 of the CGST Rules, since section 15 is not applicable in this case. Tax must be discharged at open market value (OMV) of jewelries being supplied.
Whether permanent transfer of business asset, where no ITC is availed, if made without consideration is liable to tax under GST law? (Posted On: 04 Aug, 2021)

Entry No. 1 of Schedule I of the GST law (the CGST Act) treats a permanent transfer or disposal of business assets where ITC has been availed, as a deemed supply, even if it is without consideration. In the present case, since no ITC is availed, the permanent transfer of business asset without consideration may not be treated as supply under GST and therefore, no GST shall be leviable.
A supplier is supplying goods or services to SEZ unit, under the cover of LUT without payment of IGST. Instead of taking refund of ITC paid by the supplier on his purchase, which are used for supplies to SEZ unit, can the supplier use such ITC claimed on purchase to offset tax in respect of outward taxable supplies other than SEZ supply? (Posted On: 04 Aug, 2021)

Yes, the supplier of goods or services to SEZ unit without payment of tax, can use his accumulated ITC on inward supplies which are used for SEZ outward supplies, towards set-off of tax payable on outward supplied of goods or services made to other than SEZ units. Any ITC available in his electronic credit ledger in excess after such adjustment will be available for claiming refund.
In the case of training services, we have seen many Institutes charge CGST/ SGST respectively even if the recipient is a registered person in another State. Ideally it should be IGST and payment is made online. What would be the consequences if incorrect tax is levied? (Posted On: 03 Aug, 2021)

Section 12(5) of the IGST Act provides: “the place of supply of services in relation to training and performance appraisal to,–– a) a registered person, shall be the location of such person; b) a person other than a registered person shall be the location where the services are actually performed.” As such in the instant case the supply of service shall be inter-State [Section-7(3) of IGST Act] and IGST is leviable as per section 5 of the IGST Act. Since the supplier of service has paid tax under wrong head treating the inter-State sales as intra-State, the supplier is required to pay IGST and claim refund of CGST/SGST as per section 77(1) of The CGST Act. Further the supplier will not be required to pay interest while making payment under correct head (Section 77(2) of the CGST Act). As per recent amendments the amount can be transferred to the correct head by filing the prescribed form.
When there are exempted, nil rated or zero-rated supplies in our total turnover, why is RCM applicable, even though we are paying GST on the total turnover? (Posted On: 03 Aug, 2021)

The applicability of reverse charge is based on the provisions of section 9(3) and section 9(4) of the CGST Act, / section 5(3) and section 5(4) of the IGST Act, respectively, which mandate the recipient to pay tax under reverse charge on inwards supplies of goods or services or both, received by the registered person (i.e., recipient) on the specific supplies of goods, services or both as notified. Hence, the provisions of reverse charge are not linked to the nature and components of the total turnover.
Whether jewellery made on an order received from customer who also provides old gold ornaments, is a mixed supply or composite supply? (Posted On: 03 Aug, 2021)

It is neither a composite supply nor a mixed supply, because in both the cases, two or more supplies must be involved. As far as supplier is concerned, only one supply is involved i.e. supply of jewelry. In case of exchange of old gold by the customer, it is not a supply by the supplier. However, taxable value must be calculated according to the provisions of Rule 27 of the CGST Rules, since section 15 is not applicable in this case. Tax must be discharged at open market value (OMV) of jewelries being supplied.
Whether permanent transfer of business asset, where no ITC is availed, if made without consideration is liable to tax under GST law? (Posted On: 03 Aug, 2021)

Entry No. 1 of Schedule I of the GST law (the CGST Act) treats a permanent transfer or disposal of business assets where ITC has been availed, as a deemed supply, even if it is without consideration. In the present case, since no ITC is availed, the permanent transfer of business asset without consideration may not be treated as supply under GST and therefore, no GST shall be leviable.
A supplier is supplying goods or services to SEZ unit, under the cover of LUT without payment of IGST. Instead of taking refund of ITC paid by the supplier on his purchase, which are used for supplies to SEZ unit, can the supplier use such ITC claimed on purchase to offset tax in respect of outward taxable supplies other than SEZ supply? (Posted On: 03 Aug, 2021)

Yes, the supplier of goods or services to SEZ unit without payment of tax, can use his accumulated ITC on inward supplies which are used for SEZ outward supplies, towards set-off of tax payable on outward supplied of goods or services made to other than SEZ units. Any ITC available in his electronic credit ledger in excess after such adjustment will be available for claiming refund.
What is the provision in case the recipient makes a delayed payment of consideration for the supply of goods/services rendered by the supplier? Are there any additional provisions for late fee charged on delayed settlement? (Posted On: 24 Jul, 2021)

As per second proviso to section 16(2) of CGST Act, where a recipient fails to pay to the supplier of goods or services or both, other than the supplies on which tax is payable on reverse charge basis, the amount towards the value of supply along with tax payable thereon within a period of 180 days from the date of issue of invoice by the supplier, an amount equal to the ITC availed by the recipient shall be added to his output tax liability, along with interest thereon, in such manner as may be prescribed under rule 37 of the CGST Rules. Also that the recipient shall be entitled to avail credit of input tax on payment made by him of the amount towards the value of supply of goods or services or both along with tax payable thereon. The recipient will be entitled to avail the credit again without any time limit. In case part-payment has been made, proportionate credit would be allowed. Note: The supplier would not be subjected to additional burden because of the late receipt of consideration for the supply made. In case any additional fees or penalty is charged for late payment, then as per section 12(6) of the CGST Act, the time of supply will be the date on which the supplier receives the addition in value and as per section 15(2) thereof, the additional fees is to be included in the value of supply and hence, GST shall be charged at applicable rates.
X, a registered person in the State of Madhya Pradesh, appoints clearing and forwarding agent Y, a registered person in the State of Delhi, for the purpose of import of goods from outside India. Whether, the supply of service made by a Y to be treated as inter-State supply or to be treated as import of service? (Posted On: 24 Jul, 2021)

Since the said service is not covered under any of the sub-sections (3) to (14) of section 12 of the IGST Act, the same shall be covered under section 12(2) thereof. As per section 12(2) of the IGST Act, the place of supply of service shall be the location of the recipient of service (i.e. Madhya Pradesh). Since the location of the supplier (i.e. Delhi) and place of supply (i.e. Madhya Pradesh) are in two different States, it shall be treated as an inter-State supply. The said service shall not be treated as import of service.
Whether we have to maintain the records i.e. sale and purchase value, for each item for the purpose of margin on which tax has to be calculated in case of resale of old vehicles? How valuation will be done in that case? (Posted On: 24 Jul, 2021)

Yes, you have to maintain the records i.e. sale and purchase value, for each item. The taxable value of supply of second-hand goods i.e., used goods as such or after such minor processing which does not change the nature of goods, shall be the difference between the purchase price and the selling price, provided no ITC has been availed on purchase of such goods. However, if the selling price is less than the purchase price, that negative value will be ignored. Persons who purchase second hand goods after payment of tax to supplier of such goods will be governed by this valuation rule only when they do not avail ITC on such input supply. If ITC is availed, then such supply will be governed by normal GST valuation.
A registered scrap dealer having turnover exceeding ` 3 crores is buying goods from various junk / scrap dealers and rag pickers like nylon, polyester waste etc., who are not registered under GST. What GST liability will arise under reverse charge? (Posted On: 24 Jul, 2021)

Section 9(4) of the CGST Act, covers provisions on RCM in case of inward supplies being made by unregistered persons. Further, effective from 01.02.2019, reverse charge will be applicable only for specified categories of goods or services or both received from unregistered supplier for a specified class of registered persons as notified. In this regard, Notification no. 07/2019-Central Tax(Rate) dated 29.03.2019 has been issued covering specific supplies received from unregistered persons by specific recipients, effective from 01.04.2019. The procurement from unregistered scrap dealers by a registered scrap dealer shall not be covered under reverse charge under section 9(4) of the CGST Act, 2017, as it is not covered under Notification 07/2019-Central Tax(Rate) dated 29.03.2019.
Bills raised during October, 2020 erroneously omitted in Form GSTR-1 and a Nil Return has been filed. During November, 2020 the bills raised during October 2020 were shown. In this scenario, whether interest is to be paid and if so, at the rate of 18% or 24%? (Posted On: 24 Jul, 2021)

Interest is to be paid for outward tax liability according to section 50(1) of the CGST Act which is 18% for the period from the due date of filing Form GSTR-3B till the date when the liability is discharged. For payment of interest reporting in Form GSTR-1 is not a criterion. Interest is required to be paid when the said transaction is not included in Form GSTR-3B and because of that tax has not been paid for the said transaction. If the above transaction is not included in Form GSTR-3B for the month of October, 2020 and included in Form GSTR-3B in any subsequent month, interest is to be paid for the period from the due date of filing Form GSTR 3B for the month of October, 2020 till the date when such transaction is reported.
A property is located at Dhanu, Maharashtra while the contractor is in Gujarat. Repairs and maintenance contract services would be provided by supplier in Maharashtra to the contractor in Gujarat for the property in Maharashtra. What would be the GST applicable? (Posted On: 21 Jul, 2021)

In the case of any service relating to immovable property including works contract service, grant of rights to use immovable property, services for carrying out or co-ordination of construction work, including that of architects or interior decorators, the place of supply shall be the locations of such immovable property vide section 12(3) of the IGST Act. In case the RMC services are being made available by a person in the State of Maharashtra to a contractor in Gujarat for the purpose of a works contract for a property situated in Maharashtra, the location of the supplier and place of supply would be within Maharashtra and accordingly CGST and Maharashtra SGST would be applicable.
As per one of the options given for valuation of stock transfer, it can be valued at 90% of the sale price, if the same is sold to an unrelated buyer. However, in case of tea, the price is determined by auction and the same is not known at the time of stock transfer. How should the stock transfer be valued in this case? (Posted On: 21 Jul, 2021)

As per Rule 28 of the CGST Rules, value of supply will be the open market value of such goods and when the open market value is not available, at the option of supplier, 90% of the price at which like kind and quality of goods sold by the recipient as such to an unrelated customer for money, will be value of supply. If the products are sold as such by the recipient, at the time of supply the price at which such goods are sold by the recipient will be accepted as the value of supply.
Whether a tax payer availing security services is bound to pay tax on RCM basis even if the security service provider is a registered person? (Posted On: 21 Jul, 2021)

Security services will be liable under RCM so long as the service provider is a person other than a body corporate, irrespective of the fact whether or not he has otherwise registered under GST Act, but the receiver of these services is a registered person located in the taxable territory.
Whether services of members of the Managing Committee (MC) to the Co-op society being a registered person would fall within the scope of sec 9(3) of the CGST Act. Who has to calculate GST liability as MC members were not paid any sitting fees, meeting allowances, etc. by whatever name called. (Posted On: 21 Jul, 2021)

As per sec. 9(3) of the CGST Act and sec. 5(3) of the IGST Act, the government may on the recommendations of the council, by notification, specify the categories of supply of goods or services or both, the tax on which shall be paid on reverse charge basis by the recipient of such goods or services or both and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both. The CBIC has specified the categories of supply of services, wherein the GST will be charged on RCM. The services of members of MC to co-op society are not covered by any of notifications and hence are not liable for payment of tax on RCM.
A person supplies flour in a bag along with one additional plastic container. Does this constitute composite supply? (Posted On: 21 Jul, 2021)

Sec. 2(30) of the CGST Act, provides that COMPOSITE SUPPLY means a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services both or any combination thereof which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply. From the above definition it is clear that packing materials constitute ancillary supplies of composite supply. The purpose of giving plastic container along with the flour bag is to store the flour in the container. Hence, the same shall be considered as ancillary supply and the rate applicable for the flour shall be applied for the entire price charged.
Stocks written-off being old or non-moving, is ITC needed to be reversed? Is reversal required even in case such stock is still held physical stock of the registered person? (Posted On: 19 Jul, 2021)

Yes. Section 17(5) (h) of the CGST Act, provides that ITC shall not be available in respect of goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples. Thus, ITC is to be reversed on stock which is written-off. However, one can take a legal position that the above restriction may not apply in case stock is only partially written-off. The aforesaid reversal of credit is true irrespective of whether the stock is physically held by the registered taxpayer even after writing-off.
A retailer has booked an under-construction commercial shop in same city as his branch and he has paid GST while purchasing commercial shop. Can he claim ITC of GST paid on purchase of shop, to be utilized against his regular output liability? (Posted On: 19 Jul, 2021)

Section 17(5)(d) of the CGST Act, specifically places a restriction for availment of ITC with respect to construction of an immovable property including when such property is used in the course or furtherance of business. It reads: “(d) goods or services or both received by a taxable person for construction of an immovable property (other than plant or machinery) on his own account including when such goods or services or both are used in the course or furtherance of business Explanation. -For the purposes of clauses (c) and (d), the expression “construction” includes re-construction, renovation, additions or alterations or repairs, to the extent of capitalization, to the said immovable property;” Further, as per Schedule II of the CGST Act read with NN 11/2017- CTR, sale of under-construction unit is deemed construction service. Therefore, the retailer is not eligible for availment of ITC on purchase of shop.
Will the ITC remaining unutilized in electronic credit ledger be available on transfer on account of sale, merger, demerger, amalgamation, lease or transfer of business per section 18(3) of the CGST Act? What is the treatment in case of demerger? (Posted On: 19 Jul, 2021)

As per section18(3) of the CGST Act, read with Rule 41(1) of the CGST Rules, a registered person shall, in the event of sale, merger, de-merger, amalgamation, lease or transfer or change in the ownership of business for any reason, furnish the details of sale, merger, demerger, amalgamation, lease or transfer of business, in FORM GST ITC-02, electronically on the common portal along with a request for transfer of unutilized ITC lying in his electronic credit ledger to the transferee. In case of demerger, the ITC shall be apportioned in the ratio of the value of assets of the new units as specified in the demerger scheme. It is worth noting that for the purpose of this sub-rule, “value of assets” means the value of the entire assets of the business, whether or not ITC has been availed thereon. Circular No.133/03/2020-GST dated 23.03.2020 provides further clarification in such transactions.
With regard to IGST paid on import or tax paid under RCM, whether ITC is allowed even if the supplier has not provided its details in Form GSTR-2A, or the restriction stipulated under Rule 36(4) of the CGST Rules will apply? (Posted On: 19 Jul, 2021)

As the above items cannot be reflected in Form GSTR-2A, the recipient is entitled to take ITC based on the documentary evidence of payment of tax. Restrictions provided in Rule 36(4) of the CGST Rules, shall not apply to the above items. This has also been clarified in Circular No. 123/42/2019-GST dated 11.11.2019
Whether sale of business without any transfer of assets constitutes supply under GST? (Posted On: 19 Jul, 2021)

Yes, as per Section 2(17)(d) of the CGST Act, “business” includes supply or acquisition of goods including capital goods and services in connection with commencement or closure of business. Therefore, all the assets in the sale of business would be regarded as ‘supply’. Also, Entry No. 4 of Schedule II of the CGST Act mentions this type of transfers as supply of goods. However, it may be noted that services by way of transfer of a going concern as a whole or an independent part of it will not be liable to be taxed in view of the exemption notification issued in this regard. vide Sl.No. 2 in NN 12/2017-CTR/ NN 9/2017-ITR.
Bills raised during October, 2020 erroneously omitted in Form GSTR-1 and a Nil Return has been filed. During November, 2020 the bills raised during October 2020 were shown. In this scenario, whether interest is to be paid and if so, at the rate of 18% or 24%? (Posted On: 17 Jul, 2021)

Interest is to be paid for outward tax liability according to section 50(1) of the CGST Act which is 18% for the period from the due date of filing Form GSTR-3B till the date when the liability is discharged. For payment of interest reporting in Form GSTR-1 is not a criterion. Interest is required to be paid when the said transaction is not included in Form GSTR-3B and because of that tax has not been paid for the said transaction. If the above transaction is not included in Form GSTR-3B for the month of October, 2020 and included in Form GSTR-3B in any subsequent month, interest is to be paid for the period from the due date of filing Form GSTR 3B for the month of October, 2020 till the date when such transaction is reported.
Should transactions made by an Indian company's branch offices located outside India be reported in the GST returns of the company under exempted/nil rated supplies? (Posted On: 17 Jul, 2021)

The GST returns require details of the outward and inward supplies made by that particular registered person only. The transactions undertaken by the foreign branch of the Indian entity shall not be required to be reported in the GST returns. However, the supplies made by the Indian entity to the foreign branch or vice versa will be required to be reported by the Indian entity.
While filing Form GSTR-3B, if the ITC reflected in Form GSTR 2A, but the supplier later made amendment, how to satisfy this condition? (Posted On: 17 Jul, 2021)

If the supplier has revised Form GSTR-1 to rectify his mistake, it indicates, credit was availed wrongly by the purchaser. In such a case, credit needs to be reversed. If credit was availed as per prescribed provisions, follow up needs to be taken with the supplier for re-correcting Form GSTR-1.
A Football Academy is supplying services from Delhi and Mumbai. Whether the Academy should take separate registration in each State? (Posted On: 17 Jul, 2021)

If a Football Academy is supplying services from both the locations namely Delhi and Mumbai, then as per section 22(1) of the CGST Act read with section 22(1) of Maharashtra GST Act and Delhi GST Act, it is liable to take separate registrations under respective State GST Acts. Thus, two separate registrations have to be taken. Every State will be treated as a separate taxable territory in GST. Such registered persons will be treated as distinct persons for the purpose of section 25 of the CGST Act. Any supply of goods or services or both between these entities shall be treated as supply as per Entry No. 2 of Schedule I to the CGST Act, even though such supply is without consideration.
Whether a general credit note issued after sale can reduce the supplier’s outward liability? (Posted On: 17 Jul, 2021)

Credit notes can be issued only by the supplier. When a credit note is issued within the time prescribed by section 34(2) of the CGST Act, then the output tax liability can be reduced to the extent of value as mentioned in the credit note. General credit note here means financial or commercial credit note which contains no reference to the GST amount. The base price is considered, and no GST impacts are considered. Hence, GST credit note is different from financial credit note and GST may not impact the transaction.
We have not filed my GST returns since 2nd half year of FY 2019-20. Can we claim ITC credit of those months at the time of filing the pending returns? (Posted On: 17 Jul, 2021)

Section 16 (4) of the CGST Act reads as under: “(4) A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or invoice relating to such debit note pertains or furnishing of the relevant annual return, whichever is earlier.” As per the aforesaid provision, the time limit for taking ITC for the months of October 2019 to March 2020 is up to the date of filing of return (Form GSTR-3B) for the month of September 2020. The due date of filing of Form GSTR-3B for the month of September 2020 was 20th of October 2020. If the returns for the months of October 2019 to March 2020 are filed after 20th October 2020 then ITC for that period cannot be availed.
Can ITC be availed on installation of water fountain, if such water fountain is installed at a hotel? (Posted On: 17 Jul, 2021)

If the water fountain expense has been grouped under Revenue Expense in the books of account, then, the ITC relating to the expense shall be available. However, if the expense has been capitalized in books of accounts, then also ITC shall not be available.
Assessee imported certain goods on CF (cash and freight) basis, any GST implications? (Posted On: 17 Jul, 2021)

The rate of GST needs to be discharged on the freight amount is 5% in accordance with notification 8/2017 – IGST (Rate). The value of ocean freight would be deemed as 10% of the CIF Value, when the freight amount not known. GST on same would be payable under reverse charge. Also, the credit on same can be availed.
Assessee was a supplier and manufacturer of some FMCG products. It introduced a scheme wherein certain packets were given free on purchase of certain minimum qty? During invoicing assessee mistakenly failed to mention the qty free supplied but the invoicing was done including cost of free samples? What are consequences? (Posted On: 17 Jul, 2021)

As per Section 15(2) The transaction value under subsection (1) shall consists – “The value, apportioned as appropriate, of such goods and/or services as are supplied directly or indirectly by the recipient of the supply free of charge or at reduced cost for use in connection with the supply of goods and/or services being valued, to the extent that such value has not been included in the price actually paid or payable.” Also, section 31 read with the rule 46 it is mandatory to mention Quantity & unit of measurement (in case of goods). Thus, in above case since the value was already added but the invoice details were wrongly mentioned. Thus, the same can attract general penalty of Rs 25000. A letter of intimation regarding the same can be given in jurisdictional department office mentioning unintentional mistake.
Certain goods moved from Vadodara to Ahmedabad by an unregistered transporter of Delhi and registered recipient at Ahmedabad paid the freight charges. Under which head GST will be payable? (Posted On: 17 Jul, 2021)

Two factors decided the GST payable. First is location of supplier and second is place of supply. Location of supplier i.e. transporter is at New Delhi. Section 12 of IGST Act, 2017 provides for determination of place of supply in case both the service provider and service receiver are located in India. As per sub-section (8) of Section 12, place of supply of services by way of transportation of goods shall be the location of recipient, if registered. The registered recipient in this case is at Gujarat. Thus IGST will be payable.
A recipient of supply has reversed the ITC on account of nonpayment of the value of supply to supplier. When subsequently payment is made towards such supply, is he entitled to avail the ITC? Is there any time limit prescribed for such re-availment? (Posted On: 17 Jul, 2021)

As per second proviso of section 16(2) of the CGST Act, the registered person must pay the supplier the value of goods along with tax amount within 180 days from the date of invoice. Upon the failure of doing so, corresponding credit availed by the registered person will be added to his output tax liability along with interest at the rate of 18 % (from the date of availing credit to the date when the amount was added to his output liability). However, ITC can be fully availed, once payment is made to the supplier. As per Rule 37(4) of CGST Rules, the time limit specified under section 16(4) of the CGST Act, for normal availment of ITC, shall not apply to a claim for re-availing of any credit, in accordance with the provisions of the Act or the provisions of this Chapter that had been reversed earlier. Hence, there is no specific time limit restriction for re-availment of reversed ITC.
Supplier has uploaded invoice details in Form GSTR-1, but the recipient is not in possession of the invoice. In such a case what is the criteria for availing credit? (Posted On: 17 Jul, 2021)

One of the conditions for taking ITC as per section 16(2) of the CGST Act is that the recipient is in possession of a tax invoice or debit note issued by a registered, or other prescribed tax payer. Hence for availment of ITC, the recipient should be in possession of the same. When the recipient of supply is not in possession of tax invoice or other valid prescribed documents, ITC cannot be claimed eventhough the said invoice appears in his Form GSTR-2A.
Assessee uses electric vehicles within the factory premises to transport the goods within the premises. Also, assessee changes the battery of same on frequent intervals? Is ITC available on same? (Posted On: 17 Jul, 2021)

As per Section 16(1) of CGST Act, ITC can be availed on goods and services which are used in the course of furtherance of business. Since the words ‘goods’ have been used, it implies that goods include 'Capital goods' and ‘inputs. The above will be classified as capital goods under the head plant and machinery and same will be available as ITC. The same is also not blocked u/s 17(5) of the act as the same is not a passenger vehicle nor the same is required to be registered with local RTO.
If a truck is purchased from Africa and is sold directly to Germany by "X", what will be the place of supply if the billing for the above transaction is done at Surat (Registered Place of Business of X) and will the transaction be subject to IGST levy? (Posted On: 17 Jul, 2021)

As per Entry No. 7 of Schedule III of the CGST Act [Inserted vide the Central Goods and Services Tax (Amendment) Act, 2018 w.e.f. 1-02-2019], the following activity or transaction shall be treated neither as a supply of good nor a supply of service: "Supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India". Considering the above provision, since the truck is supplied directly from Africa to Germany, the supply of goods is made without such goods entering into India. This transaction can neither be considered as supply of goods nor supply of services.
Mr. A had filed an appeal before the Appellate Tribunal against an order of the Appellate Authority where the issue involved relates to place of supply. The order of Appellate Tribunal is also in favour of the Department. Mr. A now wants to file an appeal against the decision of the Appellate Authority as he feels the stand taken by him is correct. Advise him suitably with regard to filing of an appeal before the appellate forum higher than the Appellate Tribunal. (Posted On: 17 Jul, 2021)

As per section 117(1) of the CGST Act, 2017, an appeal against orders passed by the State Bench or Area Benches of the Tribunal lies to the High Court if the High Court is satisfied that such an appeal involves a substantial question of law. However, appeal against orders passed by the National Bench or Regional Benches of the Tribunal lies to the Supreme Court and not High Court. As per section 109(5) of the Act, only the National Bench or Regional Benches of the Tribunal can decide appeals where one of the issues involved relates to the place of supply. Since the issue involved in Mr. A’s case relates to place of supply, the appeal in his case would have been decided by the National Bench or Regional Bench of the Tribunal. Thus, Mr. A will have to file an appeal with the Supreme Court and not with the High Court. The place of supply in the above case would be Gujarat since the earthwork services are rendered in Gujarat.
???? ?????? ?? ???? ???? ????? ???? ?? ??? ?? ????? ??? PLACE OF SUPPLY ???? ????? (Posted On: 09 Jul, 2021)

??????? ?? ??? (POS) ???? ?? ?????? ?? ?????? ?? ?????? ?? ??? ???? ?????? ?????? ?? ???? ???? ?????? ??????? ?? ???? ??????? ?????? ?? ??????? ??? ???? IGST ??????? ?? ???? 12(12) ?? ??????, ??????? ?? ???? ??????? ?????? ?? ??? place of supply supplier of services ?? ??????? ?? ?????? recipient of services ?? ????? ?????
Whether refund of tax paid on intra-State supply which is subsequently held to be inter-State supply and vice versa can be claimed? Whether such transaction can be rectified in GST return? (Posted On: 09 Jul, 2021)

CBIC vide Circular No 26/26/2017-GST dated 29.12.2017 has prescribed the methodology for rectification of error in submission of Form GSTR-3 and Form GSTR-1 return. Accordingly, liability which was wrongly paid can be corrected in the return of the subsequent month(s). In the case of Bharti Airtel Ltd v. Union of India And Others WP. (C) 6345/2018, CM Appl. 45505/2019, it was held that since Government could not operationalize the statutory forms envisaged under the Act, the benefit of rectification of errors must be allowed. Alternatively, refund of such tax can be claimed as per the provisions of section 77 of the CGST Act read with rule 89(2) (j) of the CGST Rules. CBIC vide Circular No 125/44/2019-GST dated 18.11.2019 has specified the procedure for claiming refund of tax paid under intra- State instead of inter-State transaction or vice versa.
Assessee has installed street lights in factory premises. Is ITC available on the same? (Posted On: 09 Jul, 2021)

To avail input tax credit for the Capital Goods the following conditions, in addition to conditions as stated under section 16(2) of the CGST Act, are to be fulfilled. 1. The Capital Goods has been capitalized in books of account of the person and 2. The Capital Goods are used or intended to be used in the course or furtherance of business. In above case the street lights are installed in factory premises intended for furtherance of business will be eligible for ITC if the same has been capitalized in books as part of plant and machinery and not in building head. Depreciation on ITC component of same is not available. Further, tube light can easily be dismantled and is not permanently installed.
Assessee is a running a club wherein certain members whose membership started from April of the financial year but the billing of the same was done in the month of September? is the same correct under GST law? (Posted On: 09 Jul, 2021)

Section 13- Time of supply of services is prescribed to be the earlier of: a) date of issue of invoice and b) date of receipt of payment. Date of issue of invoice requires us to examine section 31 which deals with the requirement to issue a “tax invoice”. In relation to services, section 31 requires that a tax invoice be issued whether before or after provision of service Rule 47 of the CGST Rules prescribes the time period within which such invoice should be issued. It states that in case of the taxable supply of services, invoice should be issued within thirty days from the date of supply of services. In above case since the service of membership has started in April itself and thereon say for the month of May the invoice should have been issued by 30th June as per rule 47 but the same is issued in September. This may lead to demand of interest liability for the delayed payment of tax.
An assessee say A Ltd. registered in Mumbai has entered into certain agreement with another party Y registered in Gujarat wherein certain machinery on job work. Owing to complexities in GST compliance related to job work the parties decided to enter into rent agreement for the machinery and wants to avoid the transportation back to owner, is the same feasible under GST law? (Posted On: 09 Jul, 2021)

Section 2(68) of the CGST Act, 2017 defines job work as ‘any treatment or process undertaken by a person on goods belonging to another registered person’. A registered person (Principal) can send inputs/ capital goods and subject to certain conditions without payment of tax to a job worker. Inputs and/or capital goods sent to a job worker are required to be returned to the principal within 1 year and 3 years, respectively, from the date of sending such goods to the job worker. Therefore, statutory provisions require the capital goods to be received back within span of 3 years in order to avoid payment of tax. Since in above case the assessee aims to convert the agreement into rental agreement, in such case intimation can be given to the jurisdictional GST department regarding modification of arrangement and clarifying that GST would be paid on rental income.
X, a registered person in the State of Madhya Pradesh, appoints Custom house agent Y, a registered person in the State of Delhi, for the purpose of import of goods from outside India. Whether, the supply of service made by a Y to be treated as inter-State supply or to be treated as import of service? (Posted On: 07 Jul, 2021)

Since the said service is not covered under any of the sub-sections (3) to (14) of section 12 of the IGST Act, the same shall be covered under section 12(2) thereof. As per section 12(2) of the IGST Act, the place of supply of service shall be the location of the recipient of service (i.e. Madhya Pradesh). Since the location of the supplier (i.e. Delhi) and place of supply (i.e. Madhya Pradesh) are in two different States, it shall be treated as an inter-State supply. The said service shall not be treated as import of service.
X. located in Mumbai places a purchase order for procurement of material from Y of China and directs Y to supply goods directly to Z of South Africa; the bill is raised by X to Z. What will be the place of supply in the above case? (Posted On: 07 Jul, 2021)

Transactions taking place before filing of bill of entry are termed as “high sea sale” transactions under common trade practice where the original importer sells the goods to a third person before the goods are entered for customs clearance. In the present case, the goods would never be imported into India (i.e., are directly supplied from China to South Africa). This situation is covered under Entry No. 7 of Schedule III ACTIVITIES OR TRANSACTIONS WHICH SHALL BE TREATED NEITHER AS SUPPLY OF GOODS NOR A SUPPLY OF SERVICES of the CGST Act which inter alia stated “Supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India.” The above transaction is not even a “supply” as per GST Law. Thus, the question of place of supply will not arise. As stated, the transaction would not be subject to GST.
An assessee is registered under GST under several places, accounting is maintained centrally at one place, what additional steps are required to be taken for swiftly adhering to GST compliance? (Posted On: 07 Jul, 2021)

The same can be done but common services of staff, accounting software and management services are required to be proper apportioned between different GST registrations.
Can an invoice in which the assessee has mentioned wrong GST No. of the party be amended for the F.Y. 2018-19? (Posted On: 07 Jul, 2021)

Section 37 of the CGST Act pertains to furnishing of details of outward supplies. According to Section 37(3), any registered person, who has furnished the details of outward supplies for any tax period and which has remained unmatched under section 42 (Matching, reversal and reclaim of input tax credit) or section 43 (Matching, reversal and reclaim of reduction in output tax liability), shall, upon discovery of any error or omission therein, rectify such error or omission in such manner as may be prescribed. The taxpayer shall pay the tax and interest, if any, in case there is a short payment of tax on account of such error or omission, in the return to be furnished for such tax period. However, no rectification of error or omission in respect of the outward supplies’ details furnished shall be allowed after furnishing of the return for the month of September following the end of the financial year to which such details pertain, or furnishing of the relevant annual return, whichever is earlier. Therefor for the invoices issued during the year 2018-19, the same could have been amended till September 2019. Thus, it cannot be amended now in F.Y. 2020-21
A, a jeweller is a registered person under GST, who attends a Jewellery exhibition in Dubai by paying a fee. Is it covered under RCM? (Posted On: 06 Jul, 2021)

As per the provisions of section 13(5) of the IGST Act, the place of supply shall be the location where the exhibition is being held i.e., Dubai. Therefore, as per section 7(1) (b) of the CGST Act, the said transaction shall be outside the scope of supply, as the place of supply is outside India. Consequently, reverse charge shall not be applicable on the same. similarly, in case of intermediary located in India service provided to person outside India the location of service provider will be place of supply. Thus, POS and place of service provider both will be in India and hence tax is leviable under head CGST and SGST.
A property is located at Maharashtra and the owner of the same is located and registered under GST in Gujarat, while the contractor is in Maharashtra. Repairs and maintenance contract (RMC) services would be provided by contractor in Maharashtra for the property in Maharashtra. What would be the GST applicable and whether ITC of the same would be available to owner of immovable property? (Posted On: 06 Jul, 2021)

In the case of any service relating to immovable property including works contract service, grant of rights to use immovable property, services for carrying out or co-ordination of construction work, including that of architects or interior decorators, the place of supply shall be the locations of such immovable property vide section 12(3) of the IGST Act. In case the RMC services are being made available by a person in the State of Maharashtra to a OWNER registered in Gujarat for the purpose of a works contract for a property situated in Maharashtra, the location of the supplier and place of supply would be within Maharashtra and accordingly CGST and Maharashtra SGST would be applicable. Also, the credit will not be available to the owner registered in GUJARAT as the place of supply is other than GUJARAT and CGST AND SGST has been charged as per above provisions.
???? GREY FABRIC ?? ????? ??? ?????? ??? ????? ?? ?????? ??? ???? ???????? ?????? ????? PROCESS ?? ????? ??? ???? ?? ? (Posted On: 06 Jul, 2021)

??? job work ?? ITC ?????? ?? ?? Inverted duty ????????? ?? CASE ??? CGST ?????? ?? ???? 89(5), ????? calculation ?? ??? formula ????????? ???? ??? ????? ?? ???, ??? ???? ???? '??? ??????' ?? ?????? ?? ??? ??? ???????? ???? ??? ?? I ???? '?????' ?? ??????? ITC ?? ????? ?? ???? ??, ????? ???? ?? INPUT SERVICE ?? CAPITAL GOODS ?? ??????? ???? ???? ?????? REFUND ?? ??? ????? ???? ???? ?? ????? ???, ??? ???? ????? ????? ???? ?? ??????? ?? ??? ?? ???? ITC REFUND ?????? ???? ??? .
Can penalty under section 73(11) be imposed in case the GSTR 3b has been delayed beyond 30 days? (Posted On: 06 Jul, 2021)

Circular no. 76/50/2018-GST specifically covers the above doubt. Clarification on same can be read as: 1. As per the provisions of section 73(11) of the CGST Act, penalty is payable in case self-assessed tax or any amount collected as tax has not been paid within a period of thirty days from the due date of payment of such tax. 2. It may be noted that a show cause notice (SCN for short) is required to be issued to a person where it appears to the proper officer that any tax has not been paid or short paid or erroneously refunded or where input tax credit has been wrongly availed or utilised for any reason under the provisions of section 73(1) of the CGST Act. The provisions of section 73(11) of the CGST Act can be invoked only when the provisions of section 73 are invoked. 3. The provisions of section 73 of the CGST Act are generally not invoked in case of delayed filing of the return in FORM GSTR-3B because tax along with applicable interest has already been paid but after the due date for payment of such tax. It is accordingly clarified that penalty under the provisions of section 73(11) of the CGST Act is not payable in such cases. It is further clarified that since the tax has been paid late in contravention of the provisions of the CGST Act, a general penalty under section 125 of the CGST Act may be imposed after following the due process of law.
Can Input tax credit be claimed in form GSTR 9? (Posted On: 06 Jul, 2021)

As per press release, Clarification regarding Annual Returns and Reconciliation Statement issued by CBIC dated 3rd July 2019 no input tax credit can be reversed or availed through the annual return. If taxpayers find themselves liable for reversing any input tax credit, they may do the same through FORM GST DRC-03 separately.
An individual act as a referee in a football match organized by Sports Authority of India. He has also acted as a referee in another charity football match organized by a local sports club, in lieu of a lump sum payment. Discuss whether he is required to pay any GST? (Posted On: 05 Jul, 2021)

Services provided to a recognized sports body by an individual inter alia as a referee in a sporting event organized by a recognized sports body is exempt from GST. Since in the first case, the football match is organized by Sports Authority of India, which is a recognized sports body, services provided by the individual as a referee in such football match will be exempt. However, when he acts as a referee in a charity football match organized by a local sports club, he would not be entitled to afore-mentioned exemption as a local sports club is not a recognized sports body and thus, GST will be payable in this case.
S Ltd. has two registered places of business in Delhi. Its aggregate turnover for the preceding year for both the places of business was ? 120 lakh. It wishes to pay tax under composition levy for one of the places of business in the current year while under normal levy for other. You are required to advice S Ltd. whether he can do so? (Posted On: 05 Jul, 2021)

A registered person with an aggregate turnover in a preceding financial year up to ? 1.5 crore is eligible for composition levy in Delhi. Since the aggregate turnover of S Ltd. does not exceed ? 1.5 crore, it is eligible for composition levy in the current year. However, all registered persons having the same Permanent Account Number (PAN) have to opt for composition scheme. If one such registered person opts for normal scheme, others become ineligible for composition scheme. Thus, S Ltd. either have to opt for composition levy for both the places of business or under normal levy for both the places of business.
M Ltd. entered into a transaction for import of goods from a vendor located in Italy. Due to financial issues, M Ltd. was not in a situation to clear the goods upon payment of import duty. M Ltd. sold the goods to an Export House by endorsement of title to the goods, while the goods were in high seas. The agreement further provided that M Ltd. shall purchase back the goods in future from Export House. Discuss the taxability of transaction(s) involved, under the GST law. (Posted On: 05 Jul, 2021)

As per Schedule III of the CGST Act, high seas sale transactions i.e. supply of goods by the consignee to any other person, by endorsement of documents of title to the goods, after the goods have been dispatched from the port of origin located outside India but before clearance for home consumption shall not be considered as supply under GST. Thus, the sale of goods by M Ltd. to Export House in high seas shall not be liable to GST. Further, the import duty including IGST shall be payable by Export House at the time of clearance of goods at port of import. In case the goods are sold back by Export House to M Ltd. at a subsequent point of time, the same shall be treated as normal domestic sale transaction and GST shall be applicable on the same subject to other conditions prescribed under GST Law.
X Ltd. has its manufacturing unit in the State of Maharashtra. It stores the finished goods manufactured by it at a depot located in the State of Gujarat. The depot is owned by Y Ltd. – a related person of X Ltd. Y Ltd. has not charged any consideration from X Ltd. for usage of depot for storage purpose. Whether the storage of goods permitted by Y Ltd. to X Ltd. qualifies as supply under GST? (Posted On: 05 Jul, 2021)

As per section 7(1)(c) read with Schedule I of the CGST Act, supply of goods or services or both between related persons without consideration when made in the course or furtherance of business qualifies as supply. Thus, the storage services provided by Y Ltd. to X Ltd. in course or furtherance of business qualifies as supply under GST even though no consideration has been charged for the same.
A ltd., a registered supplier, disposes the computers owned by the business without consideration and it has not claimed input tax credit on such computers. Examine whether the disposal of computers by A ltd. qualifies as deemed supply under Schedule I of the CGST Act. (Posted On: 05 Jul, 2021)

As per section 7(1)(c) read with Schedule I of the CGST Act, permanent transfer or disposal of business assets is treated as supply even though the same is made without consideration. However, this provision would apply only if input tax credit has been availed on such assets. Therefore, the disposal of computers by A ltd. is not a supply as the input tax credit has not been availed on the same.
Whether exchange of an old car for a new car attracts GST? If yes, what is the value of the supply? (Posted On: 03 Jul, 2021)

Section 7 of the CGST Act provides that the expression “supply” includes all forms of supply of goods or services or both such as sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business. Further, the definition of consideration [Section 2(31) of the CGST Act] also covers any payment made or to be made, whether in money or otherwise, in respect of, in response to, or for the inducement of, the supply of goods or services or both. Therefore, it is clear that consideration in kind under barter system shall also be liable to GST. Rule 27 of the CGST Rules, provides for determining the value of supply of goods or services where the consideration is not wholly in money. Suppose the new bike is purchased for 100000 and old is exchanged for 15000. Thus, as per above provision GST will be charged on 100000.
Whether penal charges collected attracts GST? (Posted On: 03 Jul, 2021)

A transaction shall be considered as supply, if it satisfies all the conditions of section 7 of the CGST Act. Further, the same shall be classified as goods or service in relation to Schedule II of the CGST Act. As per Entry No. 5(e) of Schedule II of the CGST Act, an activity to be treated as supply of services includes “agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act ". Further "to tolerate an act" can be understood as the consideration being charged by one person to allow another person to undertake any particular activity. "Agreeing to the obligation" can be understood as the obligation to pay a consideration for an act involved in a supply. Hence, penal charges imposed by the service provider to a service recipient for a breach of contract (i.e., for loss of parking ticket) attracts GST and it is a taxable supply. Cause for the penal charges can be due to either delay in payment of consideration or due to any other reason. In first case the same has to be Added to the value of original supply as per section 15(2)(d) of the CGST Act and will attract the same rate as charged in the original supply. In later case it will be treated as separate supply and GST charged would be 18%.
Assessee are registered as an AOP and are conducting seminars for women employees. Yearly transaction value is 20 lakhs and for conducting seminar assessee is collecting amounts from public sector undertaking (PSUs). Kindly clarify whether PSUs have to pay GST for delegate fee and claim ITC. (Posted On: 03 Jul, 2021)

As per Section 22 (1) of the CGST Act, the threshold limit for GST registration in case of supply of service is ` 20 Lacs; hence the said AOP should get registered under GST. Every registered person is liable to collect GST on supply of services and therefore the AOP should charge GST on amount received from the PSU. If delegate fee paid by the PSU is in the course or furtherance of business, only then the PSU will be eligible to claim ITC.
A company is manufacturing and supplying face masks and ventilator to Government at subsidized rates. Will it constitute supply under GST? (Posted On: 03 Jul, 2021)

Supply of goods to Government constitutes a supply under GST law unless such supply is specifically exempted from the levy of tax by any notification. No exemption notification has been issued in this regard so far in respect of supply of mask and ventilator under GST law. Hence, the manufacturing and supplying face mask and ventilator to Government at subsidized rate would constitute a supply under GST law and leviable under GST.
Assessee forgot to issue Eway bill for certain shipment of goods rest all compliances were done correctly i.e. payment of tax, reporting in GSTR1 etc.? Can SCN be issued under section 73/74 or under any other section like section 129, 130 or 122? (Posted On: 03 Jul, 2021)

Section 73 of CGST ACT 2017 prescribes the determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised for any reason other than fraud or any willful-misstatement or suppression of facts. Section 74 of CGST ACT 2017 prescribes determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised by reason of fraud or any willful- misstatement or suppression of facts. In both the section the SCN can be issued in case of in case the tax has been not paid or short paid whereas in the above case the tax has been correctly paid. Further on reading of section 129 of the CGST Act, deals with the detention, seizure and release of goods and conveyances in transit. Here key to analyse is that section talks about goods in transit whereas in said above case the goods have already reached destination. Therefore, the same section cannot be invoked. Section 130 of CGST Act, 2017 explains Confiscation of goods or conveyances and levy of penalty in cases where there is intend to evade payment of tax, the same is missing in present case as the tax liability has been dispose off. This leaves a general clause as mentioned in section 122(1)(xiv), penalty under Section 122 (1) of CGST Act, 2017 is imposable under following circumstances: “(xiv) transports any taxable goods without the cover of documents as may be specified in this behalf.... “ Quantum of the same shall be liable to pay a penalty of ten thousand rupees or an amount equivalent to the tax evaded or the tax not deducted under section 51 or short deducted or deducted but not paid to the Government or tax not collected under section 52 or short collected or collected but not paid to the Government or input tax credit availed of or passed on or distributed irregularly, or the refund claimed fraudulently, whichever is higher. Thus, a SCN under the section 122(1)(xiv) can be issued laving a penalty of Rs 10000 as the mount of tax evaded is nil
If any goods are supplied by a principal to his job-worker free of cost, which were supposed to be procured and supplied by the job worker himself in terms of the agreement, would such transaction (by the principal to the job worker) be considered as supply? (Posted On: 02 Jul, 2021)

Clause (b) of sub-section (2) of section 15 of the CGST Act provides that any amount the supplier is liable to pay in relation to the supply but which has been incurred by the recipient will form part of the valuation for that particular supply, provided it has not been included in the price for such supply. Accordingly, it is inferred that the value of any goods supplied by a principal to his job worker free of cost, which were supposed to be procured and supplied by the job worker himself in terms of the agreement, shall be considered as taxable supply. The valuation of such supply has to be done as per the CGST Valuation Rules. It will be clear with an example. Suppose, job worker has to be done with his own tools but he does not have money to buy such tools and principal supplies the same. Then the job worker should have reduced the same from his job charges. But as per agreement, the same was to be procured by job worker but he has not taken the same from principal. Hence, its value is to be added in job work charges and GST is payable on such transaction value.
Whether permanent transfer of business asset, where no ITC is availed, if made without consideration is liable to tax under GST law? (Posted On: 02 Jul, 2021)

Entry No. 1 of Schedule I of the GST law (the CGST Act) treats a permanent transfer or disposal of business assets where ITC has been availed, as a deemed supply, even if it is without consideration. In the present case, since no ITC is availed, the permanent transfer of business asset without consideration may not be treated as supply under GST and therefore, no GST shall be leviable.
What are the latest provisions related to Revocation Application of Cancellation of GST registration? Can revocation be filed after 180 days? (Posted On: 02 Jul, 2021)

The standard operating procedure is prescribed for revocation application vide circular number 148/04/2021 dated 18/5/2021. The normal revocation application can be filed within 30 days with proper officer. If delay occurred in filing application, then condonation of delay is to be filed with joint Commissioner for next 30 days and with the Commissioner within 60 days. If delay in applying revocation application is more then it could not be applied. The only solution is to take new registration by the taxpayer.
Assessee has GST registration in Gujarat and MP. It also has an additional place of business in MP. Now, the material is billed from MP to Gujarat but shipped from Additional place of business of MP to principal place at MP. Thereafter, Gujarat issues a job work challan to MP and job work is undertaken at MP. Invoice and e-way bill of finished goods is raised from Gujarat but movement of material takes place from MP to final customer. Is these transactions are correct? (Posted On: 02 Jul, 2021)

Yes. First transaction of movement of goods under “Billed to shop to” model is correct. The job work is undertaken by MP unit and bill is to be raised as transaction is between distinct units and GST is to be paid on job work charges. Thereafter, the material can move directly from premises of job work and invoice and e-way bill can be raised by principal unit. E-way bill should be made for movement of goods from Madhya Pradesh Principal Place of business to customer place.
Can EPCG benefit be allowed to service provider? (Posted On: 02 Jul, 2021)

Yes, the same is allowed. EPCG (Export Promotion Capital Goods) Scheme helps in facilitating the import of capital goods for manufacturing quality goods and to augment the competitiveness of India’s export. EPCG scheme covers manufacturer exporters with or without supporting manufacturer(s)/ vendor(s), merchant exporters tied to supporting manufacturer(s) and service providers. The Scheme also covers a service provider who is designated / certified as a Common Service Provider (CSP).
Mr. A, a supplier registered in Hyderabad (Telangana), procures goods from China and directly supplies the same to a customer in US. With reference to the provisions of GST law, examine whether the said activity of supply of goods by Mr. A to customer in US is taxable under GST. If yes, determine the place of supply of the same (Posted On: 30 Jun, 2021)

Schedule III to the CGST Act specifies transactions/ activities which shall be neither treated as supply of goods nor supply of services. One of such activity/transaction is supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India. Thus, it seeks to exclude from the tax net such transactions which involve movement of goods, caused by a registered person, from one non-taxable territory to another non-taxable territory. Therefore, in view of the above-mentioned provisions, the said activity is not a supply. Hence, it is not leviable to GST since “supply” is the taxable event for chargeability of GST. Therefore, since the transaction is not leviable to GST, the question of place of supply does not arise in the given case.
X Ltd. purchased certain items to be given as gifts as a part of sale promotion to be given to sales agent on achieving certain turnover target, what will be GST implication? (Posted On: 30 Jun, 2021)

As per Extract of Clause (h) to Sub Section (5) of Section 17 is as follows: “Notwithstanding anything contained in sub-section (1) of section 16 and Sub Section (1) of section 18, input tax credit shall not be available in respect of the following, namely: ……… (h) goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples; and …….” Thus, on clear reading of the section any goods distributed as gifts will not be eligible for input credit. On other hand there are divergent views of different authors where the interpretation has been taken as follows: “a "gift" means a voluntary transfer of property without compensation or any consideration. Will any company which runs its business to earn profits, distribute goods to its dealers or customers, out of love, affection or with a spiritual motive? Goods distributed to dealers and customers are indeed towards business purposes, irrespective of whether there is a written agreement for the same. Therefore, to deny ITC on the basis that there is no written contract or agreement is totally incorrect, as the underlying motive in distributing these goods is nothing but furtherance of business. It would be farcical to argue that companies could distribute goods to their dealers and customers on a voluntary basis and without a business objective and consequently, there is absolutely no merit in seeking to deny ITC on these transactions.
Assessee Suo moto wanted to make payment of credit short paid u/s 74 along with interest and penalty @15%. Though assessee deposited the requisite amount in cash ledger but failed to setoff the same vide DRC 03, what will be the consequences? (Posted On: 30 Jun, 2021)

Voluntary payment can be made before issuing the notice under Section 73 or 74 of the CGST Act 2017, or it can be made within 30 days of issue of show cause notice. A taxpayer cannot make voluntary payment after 30 days of issue of SCN. In case the same was not debited vide DRC03 the officer would not be able to issue acknowledgment in DRC04. Therefore, mere payment of challan and depositing the same in cash ledger will not provide the immunity for nonpayment within 30 days consequently 50% penalty has to be paid. Although it can be pleaded that taxpayer has deposited the amount and filing of DRC-03 is a procedural requirement. The substantive benefit cannot be disallowed on the ground of procedural infractions.
Assessee has current constitution as LLP, it proposes to convert/ merge into company, is certificate of CHARTERED ACCOUNTANT is required? (Posted On: 30 Jun, 2021)

Yes, the same is required. In terms of Section 18(3) of the CGST and SGST Acts, where there is a change in the constitution of a registered person on account of sale, merger, demerger, amalgamation, lease or transfer of the business with the specific provisions for transfer of liabilities, the said registered person shall be allowed to transfer the input tax credit which remains un-utilized in his electronic credit ledger to such sold, merged, demerged, amalgamated, leased or transferred business in the manner prescribed in the CGST / SGST Rules, 2017 by declaring the same, electronically, on the common portal in Form GST ITC-02. Rule 41(2) of the CGST Rules provides that the transferor shall also submit a copy of a certificate issued by a practicing-chartered accountant or cost accountant certifying that the sale, merger, de-merger, amalgamation, lease or transfer of business has been done with a specific provision for the transfer of liabilities
Y ltd Manufacturer sends certain category of yarn for processing to the job worker. The job worker undertakes the processing work on the yarn as per the requirement of Y ltd. During the process, the job worker uses his own material also. The processed yarn is sold by Y LTD directly from the job worker premises. Balance quantity of yarn and waste material is sent back by the job worker to Y LTD. The job worker is of the opinion that he is using his own material also in the processing and hence the supply to Y LTD is in the nature of supply of goods as well as services. Is the opinion of job worker correct? (Posted On: 29 Jun, 2021)

No, the opinion of the job worker is not fully correct. Section 7(1A) provides that when certain activities or transactions constitute a supply in accordance with the provisions of section 7(1), they shall be treated either as a supply of goods or supply of services as referred to in Schedule II of the CGST Act. Any processing activity carried on any other person’s goods is treated as supply of service in terms of Schedule II. The job worker, in addition to the goods received from the principal, can use his own goods for providing the services of job work. These goods are not supply per se, but being used in the processing activity carried out by It. Thus, the activity undertaken by the job worker, in the given case, squarely falls within the purview of Schedule II and shall be considered as supply of service by the job worker to Y LTD.
Y ltd Manufacturer sends certain category of yarn for processing to the job worker. The job worker undertakes the processing work on the yarn as per the requirement of Y ltd. During the process, the job worker uses his own material also. The processed yarn is sold by Y LTD directly from the job worker premises. Balance quantity of yarn and waste material is sent back by the job worker to Y LTD. The job worker is of the opinion that he is using his own material also in the processing and hence the supply to Y LTD is in the nature of supply of goods as well as services. Is the opinion of job worker correct? (Posted On: 29 Jun, 2021)

No, the opinion of the job worker is not fully correct. Section 7(1A) provides that when certain activities or transactions constitute a supply in accordance with the provisions of section 7(1), they shall be treated either as a supply of goods or supply of services as referred to in Schedule II of the CGST Act. Any processing activity carried on any other person’s goods is treated as supply of service in terms of Schedule II. The job worker, in addition to the goods received from the principal, can use his own goods for providing the services of job work. These goods are not supply per se, but being used in the processing activity carried out by It. Thus, the activity undertaken by the job worker, in the given case, squarely falls within the purview of Schedule II and shall be considered as supply of service by the job worker to Y LTD.
Assessee on its review of final accounts realized that certain purchase invoices have wrong GST NO. Invoice pertains TO F.Y. 2019-20, whether the same can be amended or credit notes can be issued. (Posted On: 29 Jun, 2021)

As per first proviso to section 37(3) Provided that no rectification of error or omission in respect of the details furnished under sub-section (1) shall be allowed after furnishing of the return under section 39 for the month of September following the end of the financial year to which such details pertain, or furnishing of the relevant annual return, whichever is earlier. the financial year to which such details pertain, or furnishing of the relevant annual return, whichever is earlier. Thus the same cannot be amended moreover reversal is also required of the same as per law.
Assessee has sister concern, wherein it purchases goods on bill to ship to model. Sister concern 1 wants to issue invoice on the date of dispatch of goods from location of supplier to sister concern 2, whether the same is feasible? (Posted On: 29 Jun, 2021)

As per section 16(2) of CGST Act, registered taxable person shall not be entitled to the credit of any input tax in respect of any supply of goods or services or both to him unless following conditions are satisfied: (a) he is in possession of a tax invoice or debit note issued by a supplier registered under GST Act or such other taxpaying document as may be prescribed, (b) he has received the goods or services or both, (c) subject to section 41 of CGST Act, the tax charged in respect of such supply has been actually paid to the credit of the appropriate Government, either in cash or through utilization of input tax credit admissible in respect of the said supply [section 41 of CGST Act allows taking input tax credit in electronic credit ledger on self-assessment basis], and (d) he has furnished the return under section 39 [every taxable person is required to file electronic return every month as per section 39 of CGST Act]. Thus, in above scenario the sister concern 1 cannot take credit until the goods are received by sister concern 2. Also, on the date of issue of bill the corresponding entry will be done in books of 2nd concern which will result in mismatch of stock in books vis a vis physical stock, therefore the same is not advisable.
X LTD have a factory in Delhi and a depot in Mumbai. Both these establishments are registered in respective States. Finished goods are sent from factory in Delhi to Mumbai depot without invoice because the same is not sold. What are GST implications? (Posted On: 29 Jun, 2021)

As per Schedule I of the GST Act, when a supply is made between distinct persons during the course of business, it is considered as a supply even when there is no consideration. Distinct persons are persons with different GSTINs belonging to one legal entity (single PAN) situated within the same state or in two different states or in a different country. Thus, from GST point of view the above transaction will be taxable though there would be no impact on books of accounts as this is mere book adjustment.
Assessee is engaged in purchase of certain goods under “bill to ship to” model wherein the invoice is billed to concern 1 and goods are delivered at premises of concern 2. Thereafter concern 1 issue a invoice to concern 2. Question arises who should pay the freight amount? Further how to maximize the tax benefit, given concern 1 is eligible for inverted duty refund structure? (Posted On: 29 Jun, 2021)

As per section 9(3) of CGST ACT 2017, reverse charge is payable on certain services. Likewise, the same is payable on “Supply of Services by a Goods Transport Agency (GTA)” who has not paid tax on its own. The GST is payable by the person who has paid freight to the transporter. In the above scenario, GST under RCM should be paid by concern 2 and avail the input credit. He will bill for goods to concern 1 along with cost of freight. Concern will take credit as “input” and refund of “input” is available under inverted duty structure. But the refund of “input service” is not available.
Assessee is engaged in supply of certain manufactured goods to AMAZON USA of Rs 100, Amazon further sell it at 2000, and remits 500 back to assessee in INDIA keeping Rs 1500 as commission, what will be GST implication on this arrangement? (Posted On: 28 Jun, 2021)

Sec 13(8)(b) states that place of supply in case of intermediary services shall be location of supplier of service. Thus place of supply will be outside India. Hence, it cannot be termed as import of service. Thereby making the whole arrangement outside the purview of GST law and tax will not be payable thereon.
Assessee is engaged in manufacture of certain cosmetic product. The sales chain of same floats as manufacturer---depo---distributors---wholesaler---retailer. Certain goods were given as free sample on the last leg of the chain i.e. the same suffered the incidence of GST till wholesaler and were supplied as free sample to retailer. What will be the GST implication? (Posted On: 28 Jun, 2021)

AS per Section 17(5)(h) of the CGST Act, 2017 restricts ITC on goods disposed of by way of gift or free samples. Thus, ITC has to be reversed on goods distributed as free samples. Here as the goods are ultimately supplied for free, thus wholesaler which in turn will reduce or reverse its input credit. Also, the financial credit note will be issued in rest of the chain like manufacturer to depo, depo to distributor and distributor to wholesaler.
Assessee is engaged in works contract service wherein it undertakes contract to build highways, platforms etc. where in heavy machinery to make RCC are used. These machineries are transported from one state to another, advise on GST IMPLICATIONS? (Posted On: 28 Jun, 2021)

clarification issued vide Circular No. 80/54/2018-GST dated 31.12.2018 with respect to inter-state movement of cranes, rigs, tools and spares and other machinery by a person on his own account for their supply of service. Clarification was made that any inter-state movement of goods for provision of service on own account by a service provider, where no transfer of title in such goods or transfer of goods to the distinct person by way of stock transfer is not involved, does not constitute a supply of such goods. Hence, it is clarified that any such movement on own account (not involving distinct person in terms of section 25), where such movement is not intended for further supply of such goods does not constitute a supply. Thus above arrangement won’t be liable to GST. Although there is some confusion was created by this update yet the ratio of this circular is applicable. To read more about this circular, you can view our update number: http://new.capradeepjain.com/userfiles/GSTUPDATEONCLARIFICATIONREGARDINGINTERSTATEMOVEMENTOFMACHINERYONOWNACCOUNT1.pdf
An assessee is engaged in supply of both taxable and exempted goods. For taxable supply the assessee issues proper tax invoice as mentioned in gst act, for exempted assessee issues bill of suplly, whether the same is permissible under law? (Posted On: 26 Jun, 2021)

As per section 31(3) of the CGST Act, 2017, a registered taxable person supplying exempted goods or services under GST or paying tax under Composition Scheme as per section 10 of the Act must issue Bill of Supply in place of a tax invoice. Thus statue clearly allows only certain category of assessee to issue bill of supply, assessee engaged in supply of both taxable and exempted supply should issue taxable invoice for exempted outward supply and mention category as exempted and tax thereon as nil.
Assessee is engaged in supply of both taxable and exempted products, it faces difficulty while mentioning the same in hsn summary after recent changes and amendment. (Posted On: 26 Jun, 2021)

Recently hsn code rules were amended from April 21 and certain changes were made on portal, while mentioning hsn code for exempted or nil rated product assessee has to mandatorily select the rate from drop down menu, the drop down does not provide selection specific for exempted or nil rated goods thus “zero” has to be selected mandatorily as rate field is mandatory to fill. zero rated product such as goods exported under bond/LUT for export are altogether different goods from above mentioned category. There is no specific selection from drop down menu like exempted or nil rated available till date on portal.
An assessee engaged a foreign author to write about historic forts, foreign author travels to India from abroad and writes the book by staying in the premises of assesses that is heritage fort, now the remuneration is payable to author in foreign currency , will this arrangement attract gst, and if yes whether igst or cgst? (Posted On: 26 Jun, 2021)

GST is destination-based tax i.e consumption tax, which means tax will be levied where goods and services are consumed and will accrue to that state. Thus the place of supply is such case will be location of service recipient i.e. India whereas the location of servicer provider is outside India, the transaction or arrangement is import of service on which IGST will be payable.
If the capital goods are sold as waste and scrap then GST is payable on transaction value? (Posted On: 26 Jun, 2021)

As per proviso to Section 18(6) of CGST Act, 2017, the waste of refractory bricks, moulds and dies, Jigs and fixtures can be valued at transaction value. Otherwise, we have to determine the transaction value as per query number 2.
Assessee has WDV of a capital goods in books of account at Rs. 5 Lakhs and sold the same at Rs. 2,00,000. What will be the tax implications from GST point of view? (Posted On: 26 Jun, 2021)

The query can be answered by reading section 18(6) of CGST ACT,2017 with rule 44. Section 18(6) refers to the case where the registered person who is selling the capital goods after use, on which he has taken input tax credit, shall pay an amount equal to the input tax credit taken on the said capital goods reduced by such percentage point as may be prescribed (in the CGST Rules, 2017) in this regard or pay the tax on the transaction value of such capital goods or plant and machinery determined as per Section 15, whichever is higher. Further rule 44(6) prescribes that transactions covered under section 18(6) will be valued as per rule 44(1)(b). Rule 44(1)(b) of the CGST Rules also prescribes the method of determining an amount for the purpose of Section 18(6), by stating that input tax credit involved in the remaining useful life in months shall be computed on pro rata basis, taking useful life as five years. This can be understood with help of example: Suppose, Mr. X sold his machinery for Rs. 118000/- (inclusive of GST at the rate of 18% of Rs. 18000/-) on 10.05.2020 which he purchased on 01.07.2018 for Rs. 2,95,000/- (inclusive of Rs. 45,000/- as GST @ 18%). Thus, GST PAYABLE on same would be: a. TAX ON TRANSACTION VALUE : 100000*18%= 18000 b. As per Rule 44(1)(b): total useful life used 23 months Life left: 60-23=37 Input credit actual taken 45000 Reversal as per rule 44(1)(b) 45000*37/60=27750 Thus, tax payable will be Rs. 27750 under GST law as it is higher of 18000. In present, WDV in books of accounts has nothing to do with GST payable on sale of CG. The life of CG is presumed as 5 years and value is calculated.
Assessee purchased plastic-cum-paper pouch and hallogram pasted on the same. Supplier classifies the same as plastic under the chapter head 3919 and charges 18% GST, question arises whether the same can be classified as paper since the same goes along with paper. (Posted On: 26 Jun, 2021)

Chapter head 3919 specifically covers Self-adhesive plates, sheets, film, foil, tape, strip and other flat shapes, of plastics, whether or not in rolls, thus the same is specifically covered by chapter head 3919 and GST chargeable thereon is 18%. Also, the trader has purchased goods and no process is undertaken by him. Hence, it will be billed in same HSN as charged by supplier.
QGWK4UJA7LQOJVAWXF www.google.com Where are you located ? I want to come to you one of these days QGWK4UJA7LQOJVAWXF www.web.de (Posted On: 05 Mar, 2021)
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XYZ supplying goods for export on payment of GST under claim for refund. In the invoice over and above the value of the supply and GST, they also charge freight and insurance from Indian port to the destination outside India. However, while paying GST the amount of freight and insurance is not considered being incurred for movement from port to outside India. Is it correct and if correct under which provisions because the GST authorities are demanding GST on the same. Kaustubh Karandikar (Posted On: 19 Feb, 2021)
Dear Sir, REG : Service Tax Only source of earning from Mutual Fund. 15-16 I earned more than 10 lakh. From fin yr 16-17 I had pay service tax. My query Can I avail benefit of small scale service provider (10 lakh) for fin yr 16-17 BHASKAR KUMAR (Posted On: 10 Feb, 2021)
XYZ is filing refund claim on monthly basis for accumulated ITC due to continuous exports. However, some of the suppliers are filing quarterly returns and therefore the same is not appearing in GSTR ? 2A on portal. To this extent the refund amount is not paid. Can XYZ file refund claim after end of the quarter instead of on monthly basis? If yes, under which provisions? Kaustubh Karandikar (Posted On: 06 Feb, 2021)
Where to show RCM B2C sales in GSTR 1? siva priya (Posted On: 04 Feb, 2021)
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XYZ (India) buying goods from PQR situated in Japan and instructing PQR to supply the goods directly to ABC situated in Nepal without bringing the same to India. The Invoice for the same is issued by TSI(India) on ABC in foreign currency and paying in foreign currency to PQR towards purchase of goods. No GST is paid on it by XYZ being Merchandise Trade. Is XYZ required to proportionately reverse ITC against this transaction? Kaustubh Karandikar (Posted On: 31 Jan, 2021)
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Do I have to re-enter the details entered through invoice furnishing facility in the GSTR-1 for the quarter? (Posted On: 07 Dec, 2020)

No, once details have been filed in IFF, the same need not be filed again in GSTR-1 for the quarter.
Can I use same e-mail address, mobile number and PAN combination for taking multiple registrations on GST Portal? (Posted On: 07 Dec, 2020)

Yes, you can use same e-mail address, mobile number and PAN combination for taking multiple registrations on GST Portal.
Can I avail the QRMP scheme at any time? (Posted On: 07 Dec, 2020)

You can opt in or opt out of the scheme as follows:- Quarter Between Q1 (April ?May ? June) 1st February to 30th April Q2 (July ? August ? September) 1st May to 31st July Q3 (October ? November ? December) 1st August to 31st October Q4 (January ? February ? March) 1st November to 31st January
The scn was not served online till date . It was received by the client in person . Is that a valid notice ? The notice also does not specify any time limit for replying . (Posted On: 07 Dec, 2020)

. Section 169 of CGST Act reads as follows ?169. (1) Any decision, order, summons, notice or other communication under this Act or the rules made thereunder shall be served by any one of the following methods, namely:? (a) by giving or tendering it directly or by a messenger including a courier to the addressee or the taxable person or to his manager or authorised representative or an advocate or a tax practitioner holding authority to appear in the proceedings on behalf of the taxable person or to a person regularly employed by him in connection with the business, or to any adult member of family residing with the taxable person; or (b) by registered post or speed post or courier with acknowledgement due, to the person for whom it is intended or his authorised representative, if any, at his last known place of business or residence; or (c) by sending a communication to his e-mail address provided at the time of registration or as amended from time to time; or (d) by making it available on the common portal; or (e) by publication in a newspaper circulating in the locality in which the taxable person or the person to whom it is issued is last known to have resided, carried on business or personally worked for gain; or (f) if none of the modes aforesaid is practicable, by affixing it in some conspicuous place at his last known place of business or residence and if such mode is not practicable for any reason, then by affixing a copy thereof on the notice board of the office of the concerned officer or authority who or which passed such decision or order or issued such summons or notice.? The above section uses the term ?any one of the following methods?. But decision passed in the case of M/s Shri Shyama Baba Edible Oils by Madhya Pradesh High Court, it was held that revenue has to follow the procedure prescribed under Rule 142 of CGST Rules by communicating the show-cause notice to the petitioner by appropriate mode thereafter to proceed in accordance with law and the order was quashed. In this case SCN was sent by E mail and not through the dashboard of the portal.
For SEZ unit using security services and can services, will reverse charge be applicable? (Posted On: 07 Dec, 2020)

Ans. Yes tax under RCM shall be applicable as per Notification No. 29/2018-Central tax Rate dated 31st December 2018. The relevant portion of the notification is given below for quick reference. Sl. No. Category of Supply of Services Supplier of service Recipient of service 14. Security services (services provided by way of supply of security personnel) provided to a registered person: Provided that nothing contained in this entry shall apply to, ? (i) (a) a Department or Establishment of the Central Government or State Government or Union territory; or (b) local authority; or (c) Governmental agencies; which has taken registration under the Central Goods and Services Tax Act, 2017 (12 of 2017) only for the purpose of deducting tax under section 51 of the said Act and not for making a taxable supply of goods or services; or (ii) a registered person paying tax under section 10 of the said Act. Any person other than a body corporate A registered person, located in the taxable territory.
Provisional Assessment Order can be issued by which date? (Posted On: 05 Dec, 2020)

If Tax Official accepts the application for Provisional Assessment, then ?Provisional assessment order? will be issued within 90 days of filing application to pay tax on provisional basis and Tax Official will specify the amount of bond/ surety required to be furnished. If Tax Official rejects the application, then order of rejection will be issued.
Will the Suo moto Cancellation of registration be proceeded separately for each act? (Posted On: 05 Dec, 2020)

Cancellation of registration under the CGST Act or SGST/UTGST or IGST Act shall be deemed to be a cancellation of registration under SGST Act / UTGST Act or CGST Act respectively and vice versa.
What is the duration within which I need to file a response for Show Cause Notice regarding Suo Moto Cancellation of Registration? (Posted On: 05 Dec, 2020)

You need to provide response within the prescribed time limit of 7 working days? time to file reply to the Show Cause Notice (SCN) using the Services > Registration > Application for Filing Clarifications link. If no response is given within prescribed 7 working days, the Tax Official can proceed with Cancellation of registration.
Can one update the vehicle and transporter details and extend the validity of e-way bills, if required, for the e-way bills belonging to the blocked GSTINs? (Posted On: 05 Dec, 2020)

The transporters/ tax payers can update the vehicle and transporter details and carry out the extension in validity period of these e-way bills, if required.
Form when blocking/unblocking of EWB generation facility is being implemented on EWB Portal? (Posted On: 05 Dec, 2020)

Blocking of EWB generation is implemented from?15t?December, 2019. Thus the users won?t be able to generate EWB for a GSTIN (whether as consigner or consignee), if the said GSTIN is not eligible for EWB generation as per Rule 138 E of CGST/SGST Rules, 2017.
Mera ek Known Relative hai unhone GST no le rakha hai and unke CA ne kabhi GST return nhi bhari unki since 2018. Na hi unko GST ka kuch pata tha. Or AY 19-20 ki Income Tax Return me CA ne 56 lacs ki sale show kr rkhi hai through bank (Actual me bhi itni hai ) but gst return aaj tk koe file nhi hue. Ab Kya solution hai iss bat ka ?? (Posted On: 03 Dec, 2020)

The only solution to this is to file returns by way of payment of tax along with interest and Late fees.
Sir, One of gst registered composite scheme dealer cancel of gst registered number applied Dt:20-10-2020.cancel of gst number reason for turnover below threshold limit Rs:40 lacs.if gst department officer turnover below threshold limit Rs:40 lacs limit evidence asked Dt:01-12-2020. Question: Dealer how to submit producer evidence for turnover below threshold limit Rs:40 lacs. Kollipara sundaraiah (Posted On: 02 Dec, 2020)
Provisional Assessment Order can be issued by which date? (Posted On: 01 Dec, 2020)

If Tax Official accepts the application for Provisional Assessment, then ?Provisional assessment order? will be issued within 90 days of filing application to pay tax on provisional basis and Tax Official will specify the amount of bond/ surety required to be furnished. If Tax Official rejects the application, then order of rejection will be issued.
Will the Suo moto Cancellation of registration be proceeded separately for each act? (Posted On: 01 Dec, 2020)

Cancellation of registration under the CGST Act or SGST/UTGST or IGST Act shall be deemed to be a cancellation of registration under SGST Act / UTGST Act or CGST Act respectively and vice versa.
What is the duration within which I need to file a response for Show Cause Notice regarding Suo Moto Cancellation of Registration? (Posted On: 01 Dec, 2020)

You need to provide response within the prescribed time limit of 7 working days? time to file reply to the Show Cause Notice (SCN) using the Services > Registration > Application for Filing Clarifications link. If no response is given within prescribed 7 working days, the Tax Official can proceed with Cancellation of registration.
Can one update the vehicle and transporter details and extend the validity of e-way bills, if required, for the e-way bills belonging to the blocked GSTINs? (Posted On: 01 Dec, 2020)

The transporters/ tax payers can update the vehicle and transporter details and carry out the extension in validity period of these e-way bills, if required.
Form when blocking/unblocking of EWB generation facility is being implemented on EWB Portal? (Posted On: 01 Dec, 2020)

Blocking of EWB generation is implemented from?15t?December, 2019. Thus the users won?t be able to generate EWB for a GSTIN (whether as consigner or consignee), if the said GSTIN is not eligible for EWB generation as per Rule 138 E of CGST/SGST Rules, 2017.
My office has moved to another SEZ. Can the SEZ Unit/ SEZ Developer details I had used while Registration be amended? (Posted On: 01 Dec, 2020)

Yes, SEZ details entered while registering as an SEZ unit/SEZ Developer can be amended by filing the application for amendment (core fields). Navigate to the below path on the ?GST Portal Home > Services > Registration > Amendment of Registration Core Fields? link.
Whenever I am trying to register, the system is saying there is no contact (Mobile) number with this GSTIN in GST Common Portal, how should I resolve this issue? (Posted On: 01 Dec, 2020)

This is indicating that e-invoice system is unable to get the contact details (mobile number of email address) for your GSTIN from the GST Common Portal (www.gst.gov.in). Please contact GST helpdesk 0120-4888999 or lodge your grievance at https://selfservice.gstsystem.in/.
What type of Returns not filed are considered for blocking/unblocking of EWB generation facility? (Posted On: 01 Dec, 2020)

Form GSTR-3B (to be filed by normal taxpayers) is considered for blocking of EWB generation facility.
If the supplier of service refused to issue credit note for cancellation of contract and not uploaded in portal, but paid the GST to the government. Whether recipient of service can avail the input tax paid by supplier of service. (Posted On: 01 Dec, 2020)

Section 34(2) of CGST Act 2017 reads as follows ?(2) Any registered person who issues a credit note in relation to a supply of goods or services or both shall declare the details of such credit note in the return for the month during which such credit note has been issued but not later than September following the end of the financial year in which such supply was made, or the date of furnishing of the relevant annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as may be prescribed: Provided that no reduction in output tax liability of the supplier shall be permitted, if the incidence of tax and interest on such supply has been passed on to any other person.? The proviso makes it very clear that if the supplier issues credit note and reduces the output liability then the receiver also has to reduce the ITC to the extent of credit note issued. So answering the question, the recipient of service can avail the input tax.
Is there GST on inter-state trading of fresh fruit ? (e.g. buying apples from Simla and selling in Delhi (Posted On: 01 Dec, 2020)

Fresh fruits have been made exempted from tax under GST. Fresh unprocessed goods purchased directly from agriculturist or dealer or retailer will be exempt. So there is no GST on inter-state trading of fresh fruits.
How to get enroll in QRMP scheme, whether the eligible person can migrate directly? (Posted On: 28 Nov, 2020)

To avail the benefit of this scheme, it has been clarified that all the registered persons, whose aggregate turnover for the FY 2019-20 is up to Rs 5 crore and who have furnished the return in Form GSTR-3B for the month of October, 2020 by 30th November, 2020, shall be automatically migrated on the common portal.
Whether e-invoice generated is also required to be signed again by the taxpayer? (Posted On: 28 Nov, 2020)

?Signing of invoice is required by the rules notified by the Government of India. A placeholder for digital signature has been added in the e-invoice schema and hence if a signed e-invoice is sent to IRP, the same will be accepted. ?The e-invoice will be digitally signed by the IRP after it has been validated. The signed e-invoice along with QR code will be shared with creator of document as well as the recipient. ?Once it is registered, it will not be required to be signed by anyone else.
Which fields CANNOT be amended using the application for Amendment of Registration? (Posted On: 28 Nov, 2020)

Application for Amendment of Registration cannot be filed when there is: ?Change in PAN. ?Change in Constitution of Business resulting in change of PAN. ?Change in Place of Business from one State to other. Application for Amendment of Registration cannot be filed for change in PAN because GST registration is PAN-based. You need to make fresh application for registration in case there is change in PAN. Application for Amendment of Registration form cannot be filed for change in Constitution of Business as it results in change of PAN. Similarly, Application for Amendment of Registration form cannot be filled if there is change in place of business from one state to the other because GST registrations are state-specific. If you wish to relocate your business to another state, you must voluntarily cancel your current registration and apply for a fresh registration in the state you are relocating your business.
Scenario: Export of goods with payment of IGST. Invoice date in GSTR 1filed for the month of August - 31-08-2020. Invoice date in shipping Bill - 01-09-2020. Since invoice date is mismatch, refund is not received. We have tried to change the invoice date in GSTR 1 but facing following error. Revised invoice/date is invalid. Revised date cannot be later than the last day of the tax period when original invoice/note was uploaded. (Posted On: 28 Nov, 2020)

There is no other way round available in this case except to report grievance on the portal.
Is it mandatory to add reason for amendment in GST registration? (Posted On: 27 Nov, 2020)

?Reasons? for amendment is entered in the Reasons Text box. It is mandatory for taxpayer to specify reasons for each amendment.
What is the due date for the registered person opting for Quarterly Filing of GSTR-3B? (Posted On: 27 Nov, 2020)

The registered persons opting for the QRPM Scheme would be required to furnish Form GSTR-3B, for each quarter, on or before 22nd or 24th day of the month succeeding such quarter for Class A States and Class B States respectively.
My company aggregate turnover is less than Rs 500.00 Crores, but I have been enabled. How to get disabled? (Posted On: 27 Nov, 2020)

Please call the GST helpdesk and raise the grievance and it will be verified and action will be taken in few days.
Is it required to carry a physical copy of the e-invoice during the transportation of goods? (Posted On: 27 Nov, 2020)

It is not required to carry a physical copy of an e-invoice if the e-invoice with QR Code can be shown on a digital invoice ie mobile etc to the proper officer.
What will happen in case Aadhaar details are not verified within 15 days of the generation of the TRN? (Posted On: 27 Nov, 2020)

In case, your Aadhaar details are not verified within 15 days of the generation of the TRN, an ARN for Registration Application will be generated and your Registration application will be marked for mandatory site visit and approval thereafter by the Tax Official.
What are the benefits I get, if I have opted? Yes? for Aadhaar authentication while registering on the GST Portal? (Posted On: 27 Nov, 2020)

If you have opted ?Yes? for Aadhaar authentication, while registering on the GST Portal and your Aadhaar authentication has been successfully validated, your application will be deemed approved within 3 Working days. The registration application submitted by you will not be marked for mandatory site visit. If Tax Official raises SCN within 3 working days, then you will have 7 working days to reply to it. Tax Official can take further action on that reply within 7 working days. If Tax Official doesn?t take any action in 7 working days, then application will get deemed approved after 7 working days.
What will be the effective date of applicability of QRMP Scheme? (Posted On: 27 Nov, 2020)

The QRMP Scheme will be effective from January 01, 2021 and the GSTN system would itself compute the aggregate annual turnover of the taxpayer.
Client is engaged in renting of generator services in marriage functions etc Do we need e way bill for moving generator set when generator is going in a vehicle (Posted On: 27 Nov, 2020)

Rule 138(1) of CGST Rules 2017 requires generation of E way bill in case of following ?Every registered person who causes movement of goods of consignment value exceeding fifty thousand rupees? (i) in relation to a supply; or (ii) for reasons other than supply; or (iii) due to inward supply from an unregistered person, shall, before commencement of such movement, furnish information relating to the said goods as specified in Part A of FORM GST EWB-01, electronically, on the common portal along with such other information as may be required on the common portal and a unique number will be generated on the said portal:? So the generation of E way bill is required in the present case whether it is transported by own vehicle or in other?s vehicle.
Whether eway is required while sale of import licence. (Posted On: 27 Nov, 2020)

The provisions of Rule 138 relating to E way bill says that generation of E way Bill is required only when there is movement of goods. Since sale of import license doesn?t involve movement of goods so E way bill is not required to be generated.
Hi I have a query... if a person is supplying services to one company but consideration is paid by that company by way of equity and not cash. Is there any bar on obtaining equity as consideration (Posted On: 27 Nov, 2020)

Rule 27 of CGST rules 2017 deals with Value of supply of goods or services where the consideration is not wholly in money. The excerpt from the Act is as follows ?Where the supply of goods or services is for a consideration not wholly in money, the value of the supply shall,- (a) be the open market value of such supply; (b) if the open market value is not available under clause (a), be the sum total of consideration in money and any such further amount in money as is equivalent to the consideration not in money, if such amount is known at the time of supply; (c) if the value of supply is not determinable under clause (a) or clause (b), be the value of supply of goods or services or both of like kind and quality; (d) if the value is not determinable under clause (a) or clause (b) or clause (c), be the sum total of consideration in money and such further amount in money that is equivalent to consideration not in money as determined by the application of rule 30 or rule 31 in that order.? There is no restriction on obtaining equity as consideration in law.
Whether the option to avail the QRMP Scheme is GSTIN wise (Posted On: 27 Nov, 2020)

Yes the option to avail the QRMP Scheme is GSTIN wise (some GSTINs for a PAN can opt for the QRMP Scheme and remaining GSTINs may not opt for the Scheme) and once it is exercised it would be valid for future tax periods.
Whether e-invoicing is applicable for invoices between two different GSTINs under same PAN? (Posted On: 27 Nov, 2020)

Yes. e-invoicing by notified persons is mandated for supply of goods or services or both to a registered person. As per Section 25(4) of CGST/SGST Act, ?A person who has obtained or is required to obtain more than one registration, whether in one State or Union territory or more than one State or Union territory shall, in respect of each such registration, be treated as distinct persons for the purposes of this Act.?
I filed the gstr-1 returns from feb, 2018 to up to date but while filing b2b invoices I selected yes option in reverse charge mechanism that invoices are not under reverse charge, Till now I didn't observed the mistake done by me, but after getting a knowledge about that issue there is no option to file a amendament for that invoices So i am requesting you to help me out from this issue to go forward. (Posted On: 27 Nov, 2020)

Amendment can be done of only those invoices pertaining to 2020-21 that is from April 2020 to till date. As the time period for amending the earlier period invoices has been exceeded. There is no other option left except to write a letter to the department so that no liability arises to the receiver in future.
If there is no clarity of any exemption that client has claimed in GST, then what can we do in certifying GSTR-9C? (Posted On: 27 Nov, 2020)

When there is no clarity and if the client doesn?t proper details then the audit report is to be qualified. The topics on which there is no Clarification are to be stated in Audit Report.
Can a company that is shifting it's office from one state to another transfer it's ITC from existing GSTIN to new GSTIN through ITC 02? (Posted On: 27 Nov, 2020)

Section 18 prescribes the availment of credit in certain circumstances. Sub section 3 of this section is given below for quick reading ?(3) Where there is a change in the constitution of a registered person on account of sale, merger, demerger, amalgamation, lease or transfer of the business with the specific provisions for transfer of liabilities, the said registered person shall be allowed to transfer the input tax credit which remains unutilised in his electronic credit ledger to such sold, merged, demerged, amalgamated, leased or transferred business in such manner as may be prescribed.? Shifting of business cannot be considered as sale, merger, demerger, amalgamation, lease or transfer of business. So in my opinion ITC cannot be availed through ITC-02.
Sir Is there any impact of GST on write off sundry creditors balance which is outstanding from 1.4.2017? (Posted On: 27 Nov, 2020)

No sir, there is no GST liability on writing off creditors.
Can you discuss in detail the provisions relating to rent a cab under RCM in GST? (Posted On: 27 Nov, 2020)

The RCM provisions requiring the body corporate (recipient of service) to discharge GST will apply in the following conditions: - (a) The service provider / cab operator is a non-body corporate person i.e. a proprietorship concern, HUF or partnership firm. (b) The cab operator is registered and charging 5% GST in the bill without availing ITC. (c) The service recipient is a body corporate i.e. a company including private limited company or corporation set under separate statute. In case all the above 3 conditions are fulfilled, GST will be paid by the service recipient (body corporate) on their own under RCM. The RCM provisions are not applicable in the following situations: - (a) The cab operator / service provider is a body corporate; or (b) The cab operator / service provider is paying 12% GST (normal rate under HSN Code 9964) with or without availing ITC; or (c) The service recipient is not a body corporate i.e. it is a proprietorship or partnership firm. (d) the cab operator is unregistered as his total turnover is below Rs. 20 Lakh. In case the cab operator and service recipient are located in the same State / U.T., the service recipient will pay 2.5% CGST + 2.5% SGST under HSN Code 9964 without availing ITC of goods or services used in rent-a-cab service. In case the cab operator and service recipient are located in different States / U.T., IGST @5% will be paid by the recipient body corporate.
Dear Sir Could you please help, to understand, whether from oct 2020, we have to take ITC only for those invoices which is reflected on GSTR2A, Means uploaded on GST portal or still we can claim ITC on invoice basic. Please revert on the same. (Posted On: 27 Nov, 2020)

The CBIC released an important notification on 9 October 2019, inserting a new sub-rule (4) under rule 36 of the CGST Rules, 2017. The rule states that the provisional tax credit (without invoices on GSTR-2A) can be claimed in the GSTR-3B only to the extent of 10%* (earlier it was 20% from 9/10/2019 t0 31/12/2019 and then after 1/1/2020 reduced to 10%) of eligible ITC reflected in the GSTR-2A. Hence, the total ITC that can be claimed in GSTR-3B is 110% of the eligible ITC appearing in the GSTR-2A of a particular period. (*With effect from 1 Jan 2020; Was earlier restricted to 20% for the period from 9 Oct 2019 to 31 Dec 2019.) Due to covid, certain relaxations was provided wherein the taxpayers were allowed to claim full ITC as per books for the period February 2020 to August 2020 and all the adjustments were to be done on cumulative basis while filing GSTR 3B return for the month of September 2020. The rule 36(4) will be applicable for all the months till any relaxation is provided by the government.
While filing annual return of 2018-19 are we supposed to show the ITC pertaining to 2017-18 claimed in GSTR3 B of 2018-2019. (Posted On: 27 Nov, 2020)

Since it is already part of GSTR 3B 2018-19 return, therefore, it will be bifurcated in table 6 of the GSTR 9 and moreover, it will be shown in table 12C of GSTR 9C-ITC booked in earlier Financial Years claimed in current Financial Year.
What is the time period of retention of accounts? (Posted On: 27 Nov, 2020)

Section 36 of the CGST Act explains the provisions relating to period of retention of accounts as under: - Every registered person required to keep and maintain books of account or other records shall retain them until the expiry of 72 months from the due date of furnishing of annual return for the year pertaining to such accounts and records. However, a registered person, who is a party to an appeal or revision or any other proceedings before any Appellate Authority or Revisional Authority or Appellate Tribunal or court, whether filed by him or by the Commissioner, or is under investigation for an offence under Chapter XIX, shall retain the books of account and other records pertaining to the subject matter of such appeal or revision or proceedings or investigation for a period of 1 year after final disposal of such appeal or revision or proceedings or investigation, or for the period specified above, whichever is later.
Who is responsible for the maintenance of proper accounts related to job work? (Posted On: 27 Nov, 2020)

It is completely the responsibility of the principal to maintain proper accounts of job work related inputs and capital goods.
What is the procedure for termination of operations in the bonded warehouse and surrender of premises license? (Posted On: 27 Nov, 2020)

Since the unit operating under Section 65 is also licensed as a Private Bonded warehouse under Section 58 of the Customs Act, 1962, the procedure for surrender of licence will be as per the regulation 8 of the Private Warehouse Licensing Regulations, 2016. A licensee may therefore, surrender the licence granted to him by making a request in writing to the Principal Commissioner of Customs or Commissioner of Customs, as the case may be. On receipt of such request, the licence will be cancelled subject to payment of all dues and clearance of remaining goods in such warehouse.
During October, 2018, I have not deducted any amount of GST. Do I need to file return for the month of October? (Posted On: 27 Nov, 2020)

The Deductor is required to furnish a return in FORM GSTR-7 electronically for the month in which such deductions have been made in accordance with the provision of section 39(3) of the CGST/SGST Acts, 2017. Hence, submission of FORM GSTR-7 is not required for a month in which no deduction is made.
Can a unit undertaking manufacture and other operations in a bonded warehouse import inputs without payment of duty? If yes, whether only BCD or both BCD and IGST on imports is covered? For how long is duty deferment available? Is interest payable after some time? (Posted On: 27 Nov, 2020)

Manufacture and other operations in a bonded warehouse is a duty deferment scheme. Thus both BCD and IGST on imports stand deferred. In the case of goods other than capital goods, the import duties (both BCD and IGST) stand deferred till they are cleared from the warehouse for home consumption, and no interest is payable on duty. In case the finished goods are exported, the duty on the imported inputs (both BCD and IGST) stands remitted i.e. they will not be payable. The duty deferment is without any time limitation.
One of my clients has sold his entire business including machinery and furniture by transferring all shares of all share holders. My questions are 1. Is there any GST liability in this transaction? 2. Can purchaser of business continue with old GST no.? (Posted On: 27 Nov, 2020)

According to entry no. 4(c)(i) of Schedule II to CGST Act, 2017, business transferred as going concern is not to be considered as transfer of business assets and no GST is payable on the same. Hence, if business is transferred to be run as going concern by the transferee, no GST is payable. Since, GST registration is PAN based, the purchaser of business having different PAN should take new GST registration.
when we have received discount with GST from our supplier how can we treat? (Posted On: 27 Nov, 2020)

If discount received is with GST effect then the recipient is required to reverse the proportionate input tax credit availed as is attributable to the discount received.
Whether we have to reverse ITC availed on Invoices but not appeared in GSTR 2A for the period April - 2020 to Aug - 2020 while filing GSTR 3B for the month of September - 2020? (Posted On: 27 Nov, 2020)

Yes during the lockdown period government had provided relaxation on complying with the provision of Rule 36(4) of CGST Rules 2017 by way of issuing notification no. 30/2020 ? CT dated 3rd April 2020. Later government has also issued clarification via circular No. 142/12/2020-GST dated 09th Oct 2020 wherein it was clarified that for the return GSTR-3B for the month of September 2020 Rule 36(4) shall be applicable cumulatively for the periods February, March, April, May, June, July and August, 2020. Answering the question, I would like to produce the relevant para ?3.4 The excess ITC availed arising out of reconciliation during this period, if any, shall be required to be reversed in Table 4(B)(2) of FORM GSTR-3B, for the month of September, 2020. Failure to reverse such excess availed ITC on account of cumulative application of sub-rule (4) of rule 36 of the CGST Rules would be treated as availment of ineligible ITC during the month of September, 2020.? So the quick reading of this para indicates that the credit which is not reflected in GSTR-2A is required to be reversed (other than that of excess 10% allowed).
2.Dear Sir Jab Hum kisi Je Un-reg Party Se Job Work Karate H To Us Par Rcm Book Hota h KY KItna % Or kese (Posted On: 27 Nov, 2020)

Sir RCM is not applicable on job work services being provided by an unregistered person as Section 9(4) of CGST Act is not applicable now.
1.Is the GST Input allowed on Vehicle repair and Insurance? (Posted On: 27 Nov, 2020)

Ans. Section 17(5) of CGST act has been amended through CGST Amendment Act 2018. In case of the following cases only ITC shall be available even after the amendment. 1. Motor Vehicle for transportation of persons having approved seating capacity of more than 13 persons. ( e.g. A Bus) 2. Motor Vehicle for transportation of goods. ( e.g. A Truck) 3. Motor Vehicle used for making following taxable supplies, namely:? (A) further supply of such motor vehicles ( e.g. In case of a Car Dealer) (B) transportation of passengers (( e.g. In case of a Taxi Service Provider) (C) imparting training on driving such motor vehicles ( e.g. In case of a Driving School) 4. Services received by a taxable person engaged? (I) in the manufacture of such motor vehicles (II) in the supply of general insurance services in respect of such motor vehicles insured by him;
Whether the option to avail the QRMP Scheme is GSTIN wise (Posted On: 24 Nov, 2020)

Yes the option to avail the QRMP Scheme is GSTIN wise (some GSTINs for a PAN can opt for the QRMP Scheme and remaining GSTINs may not opt for the Scheme) and once it is exercised it would be valid for future tax periods.
Whether e-invoicing is applicable for invoices between two different GSTINs under same PAN? (Posted On: 24 Nov, 2020)

e-invoicing by notified persons is mandated for supply of goods or services or both to a registered person. As per Section 25(4) of CGST/SGST Act, ?A person who has obtained or is required to obtain more than one registration, whether in one State or Union territory or more than one State or Union territory shall, in respect of each such registration, be treated as distinct persons for the purposes of this Act.?
I filed the gstr-1 returns from feb, 2018 to up to date but while filing b2b invoices I selected yes option in reverse charge mechanism that invoices are not under reverse charge, Till now I didn't observed the mistake done by me, but after getting a knowledge about that issue there is no option to file a amendament for that invoices So i am requesting you to help me out from this issue to go forward. (Posted On: 24 Nov, 2020)

Amendment can be done of only those invoices pertaining to 2020-21 that is from April 2020 to till date. As the time period for amending the earlier period invoices has been exceeded. There is no other option left except to write a letter to the department so that no liability arises to the receiver in future.
If there is no clarity of any exemption that client has claimed in GST, then what can we do in certifying GSTR-9C? (Posted On: 24 Nov, 2020)

Ans. When there is no clarity and if the client doesn?t proper details then the audit report is to be qualified. The topics on which there is no Clarification are to be stated in Audit Report.
Can a company that is shifting it's office from one state to another transfer it's ITC from existing GSTIN to new GSTIN through ITC 02? (Posted On: 24 Nov, 2020)

Section 18 prescribes the availment of credit in certain circumstances. Sub section 3 of this section is given below for quick reading ?(3) Where there is a change in the constitution of a registered person on account of sale, merger, demerger, amalgamation, lease or transfer of the business with the specific provisions for transfer of liabilities, the said registered person shall be allowed to transfer the input tax credit which remains unutilised in his electronic credit ledger to such sold, merged, demerged, amalgamated, leased or transferred business in such manner as may be prescribed.? Shifting of business cannot be considered as sale, merger, demerger, amalgamation, lease or transfer of business. So in my opinion ITC cannot be availed through ITC-02.
One of my client has sold his entire business including machinery and furniture by transferring all shares of all share holders. My questions are 1. Is there any GST liability in this transaction? 2. Can purchaser of business continue with old GST no.? (Posted On: 10 Nov, 2020)

According to entry no. 4(c)(i) of Schedule II to CGST Act, 2017, business transferred as going concern is not to be considered as transfer of business assets and no GST is payable on the same. Hence, if business is transferred to be run as going concern by the transferee, no GST is payable. Since, GST registration is PAN based, the purchaser of business having different PAN should take new GST registration.
when we have received discount with GST from our supplier how can we treat ? (Posted On: 10 Nov, 2020)

If discount received is with GST effect then the recipient is required to reverse the proportionate input tax credit availed as is attributable to the discount received.
Whether we have to reverse ITC availed on Invoices but not appeared in GSTR 2A for the period April - 2020 to Aug - 2020 while filing GSTR 3B for the month of September - 2020? (Posted On: 10 Nov, 2020)

Yes during the lockdown period government had provided relaxation on complying with the provision of Rule 36(4) of CGST Rules 2017 by way of issuing notification no. 30/2020 ? CT dated 3rd April 2020. Later government has also issued clarification via circular No. 142/12/2020-GST dated 09th Oct 2020 wherein it was clarified that for the return GSTR-3B for the month of September 2020 Rule 36(4) shall be applicable cumulatively for the periods February, March, April, May, June, July and August, 2020. Answering the question, I would like to produce the relevant para ?3.4 The excess ITC availed arising out of reconciliation during this period, if any, shall be required to be reversed in Table 4(B)(2) of FORM GSTR-3B, for the month of September, 2020. Failure to reverse such excess availed ITC on account of cumulative application of sub-rule (4) of rule 36 of the CGST Rules would be treated as availment of ineligible ITC during the month of September, 2020.? So the quick reading of this para indicates that the credit which is not reflected in GSTR-2A is required to be reversed ( other than that of excess 10% allowed).
Dear Sir जब हम किसी Un-reg पार्टी से Job Work कराते है तो उस पर RCM भी बूक होता है क्या और कितना % और कैसे (Posted On: 10 Nov, 2020)

Ans. Sir RCM is not applicable on job work services being provided by an unregistered person as Section 9(4) of CGST Act is not applicable now.
Is the GST Input allowed on Vehicle repair and Insurance? (Posted On: 10 Nov, 2020)

Ans. Section 17(5) of CGST act has been amended through CGST Amendment Act 2018. In case of the following cases only ITC shall be available even after the amendment. 1. Motor Vehicle for transportation of persons having approved seating capacity of more than 13 persons. ( e.g. A Bus) 2. Motor Vehicle for transportation of goods. ( e.g. A Truck) 3. Motor Vehicle used for making following taxable supplies, namely:? (A) further supply of such motor vehicles ( e.g. In case of a Car Dealer) (B) transportation of passengers (( e.g. In case of a Taxi Service Provider) (C) imparting training on driving such motor vehicles ( e.g. In case of a Driving School) 4. Services received by a taxable person engaged? (I) in the manufacture of such motor vehicles (II) in the supply of general insurance services in respect of such motor vehicles insured by him;
Is the GST Input allowed on Vehicle repair and Insurance Sanjay Agrawal (Posted On: 09 Nov, 2020)

Section 17(5) of CGST act has been amended through CGST Amendment Act 2018. In case of the following cases only ITC shall be available even after the amendment. 1. Motor Vehicle for transportation of persons having approved seating capacity of more than 13 persons. ( e.g. A Bus) 2. Motor Vehicle for transportation of goods. ( e.g. A Truck) 3. Motor Vehicle used for making following taxable supplies, namely:? (A) further supply of such motor vehicles ( e.g. In case of a Car Dealer) (B) transportation of passengers (( e.g. In case of a Taxi Service Provider) (C) imparting training on driving such motor vehicles ( e.g. In case of a Driving School) 4. Services received by a taxable person engaged? (I) in the manufacture of such motor vehicles (II) in the supply of general insurance services in respect of such motor vehicles insured by him;
In case any information is wrongly submitted in e-way bill. Can the e- way bill be modified or edited? (Posted On: 05 Nov, 2020)

The e-way bill once generated cannot be edited or modified. Only Part- B can be updated to it. Further, even if Part A is wrongly entered and submitted, even then the same cannot be later edited. In such a situation, e-way bill generated with wrong information has to be cancelled and generated afresh again. The cancellation is required to be done within twenty-four hours from the time of generation.
I am a regular/normal taxpayer for part period and composition taxpayer for part period during the financial year. Do I need to file Form GSTR-9A or Form GSTR-9? (Posted On: 05 Nov, 2020)

You are required to file both form GSTR-9 and Form GSTR-9A. The period during which the taxpayer remained as a Composition Taxpayer, Form GSTR-9A is required to be filed. And, for period during which the taxpayer registered as normal taxpayer, Form GSTR-9 is required to filed. Both Form GSTR-9 and Form GSTR-9A for the respective tax period are required to be filed for respective financial year in such cases.
Whether GST paid on electrical fittings, such as Cables, Switches, NCB, and other electrical consumables meant for repair of existing electrical fittings shall be available for ITC? (Posted On: 05 Nov, 2020)

Section 17 of CGST/RGST Act, 2017 debars certain activities/supplies/work from the eligibility to claim ITC. As per Section 17(5)(d), input tax credit in general is not available for construction, reconstruction, renovation, addition, alteration or repair of an immovable property even when such goods or services or both are used in course or furtherance of business. However, the limitation in such a scenario is extent of capitalization. This activity of repair and maintenance which encompasses supply of goods for a construction activity is of immovable nature. Hence, ITC will not be available to the extent of capitalization of electrical fittings. This contention is supported by the ruling of Rambagh palace Hotels Pvt. Ltd. (GST AAR Rajasthan)- Advance Ruling No. RAJ/AAR/2019-20/05 dated 30/04/2019.
During the departmental audit, it was found that there is wrongly availed credit relating to Tran 1. Hence, the taxpayer is liable to reversal of said credit. Can you give the reference of the section which determines the amount of penalty that is liable to be paid? (Posted On: 05 Nov, 2020)

Section 74 is about determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized by reason of fraud or any willful misstatement or suppression of facts. As per section 74(5), the person chargeable with tax may, before service of notice under sub-section (1), pay the amount of tax along with interest payable under section 50 and a penalty equivalent to fifteen percent of such tax on the basis of his own ascertainment of such tax or the tax as ascertained by the proper officer and inform the proper officer in writing of such payment. Hence, the penalty amounts to fifteen percent of self-assessed tax.
Supply has been made without consideration. Whether disclosure is required in the Annual Return? (Posted On: 04 Nov, 2020)

Generally, there is no GST liability on the supply made without consideration. In the absence of supply being made, it is not required to be disclosed in the Annual return. However, if the supply without consideration is in the nature of transactions covered in the Schedule I of the CGST/SGST Act and the details of the same is disclosed in the Form GSTR-1 filed then the same needs to be also disclosed in the Annual Return.
Is e way system applicable even for the movement of goods as a courier? (Posted On: 04 Nov, 2020)

Yes, for the purpose of movement of goods, courier agencies may be regarded as the transporter of the goods. Therefore, an e-way bill would be applicable even for movement of goods as courier provided consignment value exceeds Rs. 50,000/-. There could be different business practices followed in case of courier industries which needs to be suitably considered for generating an e-way bill.
Goods sold before GST which are exempted before GST and know some of the goods are damaged and buyer wants to return and now goods are taxable under GST regime. Then how they sent goods (via invoice or voucher)? (Posted On: 04 Nov, 2020)

As the movement of goods is happening post implementation of GST and also the period of 6 months from the rollout is over, the goods has to be shipped with the tax invoice only.
Sir, I have already filed GSTR 3B and GSTR 1 up to May,2020. But sir, I had a branch also in another place. And the cash sales of that branch during whole year of FY 2019-2020 left to be shown in GSTR 3B. What should be done now? Please advise me. (Posted On: 04 Nov, 2020)

Sir, any adjustment left to be shown in current month should be done in GSTR 3B next month. Therefore, while filing GSTR 3B for the month of June 2020, the omitted cash sales should be made along with interest on net liability.
I filed the gstr-1 returns from Feb, 2018 to up to date but while filing b2b invoices I selected yes option in reverse charge mechanism that invoices are not under reverse charge, Till now I didn't observed the mistake done by me, but after getting a knowledge about that issue there is no option to file a amendment for that invoices So I am requesting you to help me out from this issue to go forward. (Posted On: 04 Nov, 2020)

The last date for filing amendment for the financial year 2018-19 is last date of filing September 2018 GSTR 3B return. In addition to this, the portal does not allow any amendment after the last date. Therefore, you are not allowed to correct your mistake. You can file a grievance on the online portal or write a letter to the department for any help.
Supply has been made without consideration. Whether disclosure is required in the Annual Return? (Posted On: 04 Nov, 2020)

Generally, there is no GST liability on the supply made without consideration. In the absence of supply being made, it is not required to be disclosed in the Annual return. However, if the supply without consideration is in the nature of transactions covered in the Schedule I of the CGST/SGST Act and the details of the same is disclosed in the Form GSTR-1 filed then the same needs to be also disclosed in the Annual Return.
Is e way system applicable even for the movement of goods as a courier? (Posted On: 04 Nov, 2020)

Yes, for the purpose of movement of goods, courier agencies may be regarded as the transporter of the goods. Therefore, an e-way bill would be applicable even for movement of goods as courier provided consignment value exceeds Rs. 50,000/-. There could be different business practices followed in case of courier industries which needs to be suitably considered for generating an e-way bill.
Goods sold before GST which are exempted before GST and know some of the goods are damaged and buyer wants to return and now goods are taxable under GST regime. Then how they sent goods (via invoice or voucher)? (Posted On: 04 Nov, 2020)

As the movement of goods is happening post implementation of GST and also the period of 6 months from the rollout is over, the goods has to be shipped with the tax invoice only.
Sir, I have already filed GSTR 3B and GSTR 1 up to May,2020. But sir, I had a branch also in another place. And the cash sales of that branch during whole year of FY 2019-2020 left to be shown in GSTR 3B. What should be done now? Please advise me. (Posted On: 04 Nov, 2020)

Sir, any adjustment left to be shown in current month should be done in GSTR 3B next month. Therefore, while filing GSTR 3B for the month of June 2020, the omitted cash sales should be made along with interest on net liability.
I filed the gstr-1 returns from Feb, 2018 to up to date but while filing b2b invoices I selected yes option in reverse charge mechanism that invoices are not under reverse charge, Till now I didn't observed the mistake done by me, but after getting a knowledge about that issue there is no option to file a amendment for that invoices So I am requesting you to help me out from this issue to go forward. (Posted On: 04 Nov, 2020)

The last date for filing amendment for the financial year 2018-19 is last date of filing September 2018 GSTR 3B return. In addition to this, the portal does not allow any amendment after the last date. Therefore, you are not allowed to correct your mistake. You can file a grievance on the online portal or write a letter to the department for any help.
A contract for construction of villa has been awarded by the client including materials. I am sub-contracting this to another sub-contractor. What is the applicable GST rate for both me and the sub-contractor? Is it 12%? What if sub-contractor is charging GST at 18% but i want to bill the client at 12% Lakshay (Posted On: 04 Nov, 2020)
ONE MUMBAI BASED CONTRACTOR ISSUED A PURCHASE ORDER TO MADURAI DEALER DO SOME WORKS CONTRACT SERVICES TO A REGISTERED PERSON IN MADURAI TAMIL NADU. MADURAI IS THE PLACE OF SUPPLY RECEIVER. NOW THE WCS PROVIDER RAISES BILL AS A IGST TO MUMBAI OR CGST & SGST rvperumal (Posted On: 03 Nov, 2020)
Where a supplier transfers a running business as a whole either due to sale, merger, amalgamation of such business, whether the portion of the un-utilized input tax credit by the supplier can be claimed immediately by the recipient? (Posted On: 02 Nov, 2020)

There is no specific provision under the Act prohibiting transfer of such unutilized credit. Rather, Section 18(3) of the CGST Act, 2017 specifically provides that when there is a change in constitution of a registered person on account of sale, merger, or amalgamation of business with specific provision of transfer of liabilities, the registered taxable person shall be allowed to transfer the input tax credit which remains unutilized, provide registered person furnish the details of sale, merger, de-merger, amalgamation, lease or transfer of business, in FORM GST ITC-02, electronically on the common portal along with a request for transfer of unutilized input tax credit lying in his electronic credit ledger to the transferee. Therefore, if the recipient is registered under the Act, he should be eligible to claim such unutilized credits. In a situation, where the recipient is not registered under the Act, he may have to make a fresh application for registration and claim such unutilized credits after making intimation to the department.
Sir We are paying advocate fees along with his miscellaneous expenses 10000 Advocate fees plus 4000 misc. Exp. Are we liable to pay RCM on miscellaneous exp. Please guide us. (Posted On: 02 Nov, 2020)

Tax ability of reimbursement of expenses depends on nature of expenses incurred for provision of services by advocates. If these kinds of expenses are in nature of Pure Agent than tax need not to be paid otherwise these are taxable. e.g. Advocate paid legal fees to Government on behalf of client and charge client on actuals, then GST not to be paid by client being the all conditions of Pure Agent is fulfilled. But if in the same case, if there is mark-up in expenses, then GST is to be paid. However, in case of expenses other than nature of pure agent, GST is to be paid.
My company is in Delhi while bank is situated in Haryana Bank is charging IGST. Can I claim IGST input? (Posted On: 02 Nov, 2020)

Section 16(2) determines the conditions for availment of input tax credit. The section read as follows- Notwithstanding anything contained in this section, no registered person shall be entitled to the credit of any input tax in respect of any supply of goods or services or both to him unless, ?? (a) he is in possession of a tax invoice or debit note issued by a supplier registered under this Act, or such other tax paying documents as may be prescribed; (b) he has received the goods or services or both. (c) subject to the provisions of section 41, the tax charged in respect of such supply has been actually paid to the Government, either in cash or through utilisation of input tax credit admissible in respect of the said supply; and (d) he has furnished the return under section 39. If the above-mentioned conditions are satisfied, then you are allowed to avail the credit of the bank charges.
My company is registered IN UP and taken an office rent in UP but landlord charges IGST on rent can he make so. as rule say that for immovable property CGST and SGST can be charges on rent. Please reply. (Posted On: 02 Nov, 2020)

To classify the service as inter or intra, we have to testify two things i.e. place of supply and location of supplier. As per section 12(3) of IGST Act, the place of supply of service in relation to an immovable property shall be the location at which the immovable property is located. Therefore, in this case, the place of supply is undisputedly UP because the property is located thereat. Section 2(15) contains four clauses (a), (b), (c), (d) to determine the location of the supplier of service. In the absence of clause (a), (b), (c) of section 2(15) being applicable, the location of usual place of residence shall be the location of the supplier of services within the meaning of clause (d) of sec 2(15) of IGST Act. If the location of supplier is different from the place of supply, then the service of renting of residential property will be classified as inter state supply and hence IGST will be chargeable.
What are the documents required for registration (acquire new GSTIN No.) of a Company? (Posted On: 31 Oct, 2020)

PAN, Directors PAN, Photos, separate email for each director and contact details, Other registration no. like IEC, CIN etc, lease document or ownership document etc. HSN codes and SAC for goods and services provided, authorised signatory details, bank details, board of directors? resolution regarding authorised signatory for GST compliances etc. Once you go to the GST Portal, all these will be required to be uploaded in supported formats only.
ABC being partnership firm provide security service to XYZ (Registered Service Receiver) then whether XYZ is liable to pay GST liability on Reverse charge basis. (Posted On: 31 Oct, 2020)

GST Applicability on Security Service on or before 31.12.2018: On or before 31.12.2018 Security service provider charge GST on invoice & collect GST from customer & pay it to Government so that means Security Service Provider was liable to pay GST. GST Applicability on Security Service from 01.01.2019: With effect from 01.01.2019 Any Registered Person receiving security services (Service provided by way of supply of security personnel) from any person other than a body corporate is required to pay GST on reverse charge basis. In the given case, the service provider is not body corporate and XYZ is registered entity, hence, XYZ is liable to get registered under RCM.
One sale bill of March,2019 was omitted to be shown by me due to my mistake. I have already filed GSTR 3B up to July,2020. What should I do now to show the said omitted sale bill? (Posted On: 31 Oct, 2020)

Sir, it is advisable that the omitted bill payment should be done through the mode of DRC-03 on voluntarily basis. The reason for not channelising the payment through GSTR 3B of current month is that while filing GSTR 9 for 2018-19, it provides us the facility to mention the adjustments done pertaining to financial year 2018-19 in April 2019 to September 2019. Hence, it is advisable that payment should be done using DRC 03 along with interest.
Hi Dear All, I have GST No, last FY 2019-20 Turnover Rs 47 Lakh in current FY 2020-21 due to COVID, I will not able to make even 30 lakh turnover or may be next 2 3 years. Can I cancel my GST no, kindly advise? (Posted On: 31 Oct, 2020)

As per Notification No. 10/2019-Central Tax dated 07.03.2019, the threshold limit for GST registration (Effective from 1st April, 2019) for those engaged in exclusive supply of goods has been enhanced to Rs. 40 lacs except the following- ? Except persons engaged in making intra-State supplies in the Threshold limit for registration (For those engaged in exclusive supply of goods- States of Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Puducherry, Sikkim, Telangana, Tripura, Uttarakhand ? Except persons required to take compulsory registration under section 24 ? Except suppliers of Ice cream and other edible ice, whether or not containing cocoa; Pan masala; Tobacco and manufactured tobacco substitutes The threshold for registration for service providers would continue to be Rs 20 lakhs and in case of Special category States Rs 10 lakhs. If you are dealing in goods, then you can surrender your GST registration but in case of service provider, since your turnover is exceeding 20 lacs, hence you are not eligible to cancel it.
A Transformer manufacturing sector, GST 18% claimable on sale of transformer. But for raw material used in manufacturing transformer is purchased with different GST rates. Then how this difference can be claimed? (Posted On: 31 Oct, 2020)

Inverted duly structure: Where the credit has accumulated on account of rate of ton inputs being higher than the rate of tax on output supplies (other than nil rated or fully exempt supplies), except supplies of goods or services or both as may be notified by the Government on the recommendations of the Council. In such cases also, refund can be applied under Section 54 of the CGST Act, 2017 read with Rule 89 of the CGST Rules, 2017.
Supply of service came under RCM but supplier wrongly continued to charge full GST in bill and received also availed the input credit and not paid RCM. What can be the implication if came to notice of Tax authorities. sunil bhageria (Posted On: 26 Oct, 2020)
Supply of service came under RCM but supplier wrongly continued to charge full GST in bill and received also availed the input credit and not paid RCM. What can be the implication if came to notice of Tax authorities. sunil bhageria (Posted On: 26 Oct, 2020)
Supply of service came under RCM but supplier wrongly continued to charge full GST in bill and received also availed the input credit and not paid RCM. What can be the implication if came to notice of Tax authorities. sunil bhageria (Posted On: 26 Oct, 2020)
I filed the gstr-1 returns from feb, 2018 to up to date but while filing b2b invoices I selected yes option in reverse charge mechanism that invoices are not under reverse charge, Till now I didn't observed the mistake done by me, but after getting a knowledge about that issue there is no option to file a amendament for that invoices So i am requesting you to help me out from this issue to go forward. G Pullareddy (Posted On: 26 Oct, 2020)
I filed the gstr-1 returns from feb, 2018 to up to date but while filing b2b invoices I selected yes option in reverse charge mechanism that invoices are not under reverse charge, Till now I didn't observed the mistake done by me, but after getting a knowledge about that issue there is no option to file a amendament for that invoices, I have paid all taxes Can you please sujest what can I do sir G Pullareddy (Posted On: 25 Oct, 2020)
Services provided to a registered party within the country who is situated out side the state of the service provider but payment will be from Overseas company in foreign currency. Is this to be treated as IGST supply? When advance received from Foreign company should it appear under advances in GSTR1 if so 97-Other Territory to be selected? Where this advance to be shown in GSTR-3B. venkatraman (Posted On: 21 Oct, 2020)
what have if BRC not submitted to custom.what to have if submitted late.whether any penalty imposed? bharat (Posted On: 18 Oct, 2020)
Sir, I have sold my car (bought on) 27.09.2017 of present WDV of 3,30,500 (as per GST) for 1,80,000. My GST liability is Nil. My Query is where and how to Show the Sale in GST Returns ?? Kameshwar Yadav (Posted On: 12 Oct, 2020)
Dear Sir, A sells his used car (bought on 28.09.2017) on 30.09.2020. WDV as on 30.09.2020 as per ITAX 3.30 as against Sale Proceeds of 1.81 L resulting into Negative Value and NIL GST. Now, the Query is-'How to show this transaction in GST Returns??' CA RAKESH PRASAD (Posted On: 10 Oct, 2020)
In December 2016 we had replaced rejected job work goods to B2B Customer free of cost under a delivery challan. The buyer wants to return the rejected goods in 2020. Which documents shall have to be raised by us and the B2B customer to make transaction GST compliant. Value of goods is Rs.25000/- Supplier and Buyer both registered under GST. VINOD KUMAR (Posted On: 02 Oct, 2020)
If a person send goods outside india but goods are not sent to some buyer instead it is sent to the AMAZON FBA Warehouse for the speedy deleivery to the customer.when they krder the product through amazon...as goods are not sold at the time of export and when it is sold actually the price may differ ...Can we sent the goods through deleivery challan. Or we have to make invoice for that type of shipment.. Please suggest Akash (Posted On: 01 Oct, 2020)
We have file ST refund pre GST regime but not debited in ST-3 unknowingly and also file the TRAN-1 after post GST regime. But department neither give us ST refund nor credit in TRAN-1. What should we do? RUPAL K. JAIN (Posted On: 28 Sep, 2020)
A large steel unit clears its final products for captive consumption by its sister units at different location by applying the assessable value on the basis of CAS4 read with valuation rules. The unit has undervalued goods even though they have prepared CAS4 duly certified by CA who has not verified the data. Now GST authorities want to take action. Can GST authorities question the authenticity of CAS4. If the answer is yes I would like to know the process. Can the department order for special audit under Section 14A of erstwhile Central Excise Act Rohidas Kamath (Posted On: 27 Sep, 2020)
Balance quantity if any in stock from the said NOC has to be destroyed. NOC and Drug licence expiry date is 31.08.2020. What is the procedure I have to follow in GST (Posted On: 23 Sep, 2020)
Sir, We have obtained NOC and Drug licence from Drug office for 400 kgs.Balance quantity if any in stock from the said NOC has to be destroyed. NOC and Drug licence expiry date is 31.08.2020. Now my question is how can show zero in my RG-1 and can I prepare capitive consumption invoice or not what is the procedure in GST pls. clarify sir. sridhar (Posted On: 23 Sep, 2020)
Sir, We have obtained NOC and Drug licence from Drug office for 400 kgsBalance quantity if any in stock from the said NOC has to be destroyed. NOC and Drug licence expiry date is 31.08.2020. in this case balance qty we have destroyed internally for this activity shall we prepare capitive tax invoice or any other method pls. let us know sir. Sridhar (Posted On: 22 Sep, 2020)
Respected Sir/Madam My client which is nidhi limited company incorporated on 17.10.2019 but from that date no compliance are done even no bank account is opened , now What should i do for compliance Pls guide me PRADEEP PARIHAR (Posted On: 22 Sep, 2020)
Respected Sir/Madam My client which is nidhi limited company incorporated on 17.10.2019 but from that date no compliance are done even no bank account is opened , now What should i do for compliance Pls guide me PRADEEP PARIHAR (Posted On: 22 Sep, 2020)
A Company purchased a car for its business purpose in the year March 2018. The Company has not availed GST Credit on purchase of car. The company has claimed depreciation under Income Tax Act. Now the company intends to sale the car. The company is availing the benefit of notification no. 8/2018 CTR i.e., margin scheme for sale of used and old car. The said notification provides that the taxable value shall be the difference between Sale consideration (minus) depreciated value of such goods on the date of supply. Say for example: The cost of the car was Rs. 3 Lakhs on which GST @28% & Cess @ 1% was levied. The total cost of the car with GST taxes was Rs. 3,87,000/-. Apart from these, various other charges such as road tax, insurance, warranty etc., was charged, value of which say was Rs. 1,00,000/-. The total cost of the car is Rs. 4,87,000. So, there are three value (i) Rs. 3 Lakhs which is the price of the car (ii) Rs. 3,87,000/- which is the price with GST and (iii) Rs. 4,87,000/- which is the price of car + GST + other charges. The company would obviously capitalize the value as 4,87,000/- in the books and claimed depreciation under Income Tax on the said amount. The Notification 8/2018 CTR uses the phrase depreciated value of such goods on the date of supply. What does this phrase means. Should I calculate depreciated value of goods based on Rs. 3 Lakhs or Rs. 3.87 Lakhs or Rs. 4.87 Lakhs? Aashish Jain (Posted On: 22 Sep, 2020)
A MANUFACTURING PLANT WITH BUILDING MACHINERY IS PURCHASING THROGH AUCTION BY BANK Q-IS THE GST APPLICABLE ON THIS PURCHASING THROUGH AUCTION MUKESH SAXENA (Posted On: 21 Sep, 2020)
XYZ Pvt. Ltd. give incentive by way of cheque to certain dealers on reaching sales target of certain items. 1) Are the dealers required to pay GST on this amount received? 2) If yes, can XYZ claim ITC against the GST charged by the dealers? Kaustubh Karandikar (Posted On: 21 Sep, 2020)
Dear Sir Jab Hum kisi Je Un-reg Party Se Job Work Karate H To Us Par Rcm Book Hota h KY KItna % Or kese piyush (Posted On: 21 Sep, 2020)
If we did the payment to a foreign Travel Agent before June'2017. Wheter service tax is applicable on reversible basis or not. Please advise, Girish (Posted On: 19 Sep, 2020)
SEZ UNIT K GST 3B RETURN ME USE JO SUPPLY RECEIVED HOTI H GOODS AND SERVICES VO KAHA SHOW KARNE KI??? KIshor Prajapati (Posted On: 19 Sep, 2020)
sir, any gst registered composite scheme dealer accounting books sale ledgers and day book maintained only or stock registered maintained compulsory in gst act kollipara sundaraiah (Posted On: 18 Sep, 2020)
1) Whether it is mandatory to reverse ITC of those Invoices not appeared in GSTR2A for the F/Y 2019 - 20 while filing GSTR3B for the month of September 2020 or we can make payment of differential amount while filing Annual Returns (GSTR 9)? 2) Whether we have to reverse ITC availed on Invoices but not appeared in GSTR 2A for the period April - 2020 to Aug - 2020 while filing GSTR 3B for the month of September - 2020?. Kaustubh Karandikar (Posted On: 18 Sep, 2020)
Sir, Are money transfer agents E-Com operators? Is GSt regn. compulsory for them? Please clarify. NAGARAJAN (Posted On: 17 Sep, 2020)
Sir, A gst composite scheme registered dealer Annual return gstr4 filed 19-20.but dealer mistake sales of taxable turnover amount(outward supplies detailes)1%tax rate goods not reported in gstr4.dealer turnover and tax paid shown in every quarter cmp-08 filed. 1.dealer mistake turnover how to adjustment producure in gstr4 19-20. 2.inward supplies detailes(purchases biils) upload compulsory 3.mistake turnover adjustment in gstr4 20-21or gstr9a 19-20 is correct 4.dealer gstr9a and gstr4 filed compulsory 19-20. Kollipara sundaraiah (Posted On: 15 Sep, 2020)
Sir, Assess maintained a retaile pharmacy stores.turnover below threshold limit(40 lacs)gst not registered. 1.if any gst officer visit assess shop which type of accounting evidence asked. 2.below turnover limit dealer accounting books maintained compulsory in gst act. Kollipara sundaraiah (Posted On: 15 Sep, 2020)
Sir, A workcontractor service provider regular scheme registered in gst act. 1.dealer purchases of iron and cement goods input credit claimed eligible or not eligible 2.labour charges paid URD persons RCm applicable 3.dealer works amount received how to shown in gstr3b and gstr1 return. 4.workcontractor tds return -7 filed compulsory. Kollipara sundaraiah (Posted On: 15 Sep, 2020)
Sir Is there any impact of GST on writeoff sundry creditors balance which is outstanding from 1.4.2017 ? (Posted On: 15 Sep, 2020)

Ans.No sir, there is no GST liability on writing off creditors.
सर मेरा एक सवाल है, सिविल ठेकेदार जीएसटी में पंजीकृत है। मुख्य काम शहर या गांव में भिन्न भिन्न जगह मकान खरीद कर रिहायशी मकान Finished condition में बेच देता है । जो मैटीरियल खरीदता है वह GST return में reverse कर दिया जाता है। क्या GST liability आयेगी? (Posted On: 15 Sep, 2020)

Ans.सर, जीएसटी की Liability इस केस में नहीं आएगी क्यूंकी ठेकेदार एक residential मकान purchase कर रहा है और उसी को finished condition में supply कर रहा है | उस केस में जीएसटी की liability नहीं आती है|
Sir my GST registration cancelled by Dept. Have filed revocation appl. Officer is asking to pay 25000/- as penalty through DRC. How to pay? (Posted On: 15 Sep, 2020)

Ans:Sir, for filing DRC 03 you will have to first go under user services tab. After that select my applications, select application type Intimation of voluntary payment DRC 03 and proceed on new application.
GST query... A proprietor base firm having GST number but doing business of GST exempted product only. Now firm is deciding to buy a car, so my question is whether to give GST number or not at the time of buying CAR?... because if they provide the GST number then the GST credit will not be sett off.. pls suggest what to do? (Posted On: 15 Sep, 2020)

Ans.Sir, In any case the GST charged on car will not be available to you. As ITC is blocked u/s 17(5)(a). Whether you provide your GST number or not the tax shall be charged by the supplier and the ITC shall also not be available to you. Further, as you are engaged in the exempted supplies, no credit will be available to you.
My query is related to export of goods. That an Assessee export goods in single and small shipments. There are no. of shipments are exported in a month. Order is received on Amazon but value declare on invoice is less than the actual sale price as the customer not clear the goods because of duty imposed on that country. So we declare the value which is not levied to duty in that country. Goods are shipped through Air. But the payment received in account is actual price of Product. Is there any problem faced by us in future regarding the less declaration and payment difference. And how the compliance is done in Gst whether it is mandatory to show the export figure in 3b or just show the bills in gstr1. Please guide. (Posted On: 15 Sep, 2020)

Ans.Sir, the major issue of valuation will be for the customer in that country who has imported said goods on undervaluation so as to avoid the customs duty paid to the said government of that country. There will be penalties and repercussions under the law of that country. If we have exported the goods under bond / without payment of GST then there will not be any problem in GST as duty is not payable. But if it is cleared on payment of GST then there is less payment of GST. However, as per rules, we should show the correct value in the GST invoice for the export goods as well as in GSTR1 and GSTR 3B. Since, you are receiving more money then it is clear case of undervaluation of goods.
Sir in my case, Person issued credit note is required to disclose the credit note in GSTR3B by reducing the value if supply from other outward supplies and tax to be paid on net amount. But, by mistake, it was shown as availment of credit in GSTR-3B. What should be impact of the same in the Annual Return? (Posted On: 14 Sep, 2020)

The substantial condition for credit note is that the recipient of supply has reduced ITC to the extent tax involved on the credit note. If the registered person is in a position to verify that the recipient of supply has reversed ITC on such supply, a view may be taken that disclosure of such credit note in the ITC instead of reduction of output liability is merely a disclosure error with no revenue impact (there is no loss of revenue to the Government). However, the view may be litigated by the department which have to be suitably addressed.
XYZ is a commercial cooperative society having commercial offices. XYZ is registered with GST. They incur expenses such as 1) Building repair work include replastering, water proofing, painting work. 2) Construction / repair of weather sheet on the Terrace or in the basement. 3) Replacement / repair of open ground area tiles/paver blocks 4) Fixing of tiles on staircase. 5) Major repair of cooling tower/ Water treatment plant/firefighting system. These are not capitalized in the books of accounts. Can XYZ claim ITC on it? Kaustubh Karandikar (Posted On: 14 Sep, 2020)
Hello Sir, My client is a dealer has only export turnover exceeding Rs. 20 lakhs. Is he required to get registration under GST? He does not have any other income except interest on FD and saving bank account and capital gains on sale of shares. (Posted On: 14 Sep, 2020)

In pursuance to Section 7 of IGST Act, exports are inter-State supplies. Hence persons not liable to payment of tax on their outward supplies on account of export. He would still be required to obtain GST registration and comply with all compliances. All exporters, regardless of turnover limit, must obtain registration, file LUT, file returns, and demonstrate correctness of their claim to zero-rated benefits.
Sir what is the meaning of Unique Invoice reference no. in e-invoicing. At present we prepare our invoice in this number format MH/T/001, do we have to prepare invoices while giving reference of year also? (Posted On: 14 Sep, 2020)

Unique invoice reference number means that the specific invoice number should be used and it should not be repeated in future. We have to give reference of year also otherwise it will lead to a situation that same duplicate invoice will be generated in future also. To avoid such complications we must give reference of year also like in your case the number format will be MH/T/2020-21/001. But your number should not exceed 16-digit otherwise GST portal will not accept it.
Sir my query is on SEZ- In case of SEZ, in one of our case the officer disallowed zero rated benefit for motor car for director claiming it to be not covered in Authorised operations? (Posted On: 14 Sep, 2020)

Services not included in Authorized operations are not Zero Rated ? The services supplied which are included in authorized operations of SEZ are considered as zero rated. SEZ unit or developer can undertake 'Authorized operations' which are specified in the letter of approval issued by Development Commissioner of SEZ [section 25(9) of SEZ Act]. If the same is mentioned in LOA then it can be termed as zero rated. Normally, car used by director is not mentioned in LOP, hence it cannot be termed as zero rated.
Q5.What data elements are shown in the QR Code for an IRN generated by the IRP? (Posted On: 12 Sep, 2020)

The QR code contains the following data- Invoice value (taxable value and gross tax) GSTIN of the Supplier GSTIN of the Recipient Tax Invoice Number Date of Tax Invoice The number of line items. HSN Code of the main item (the line item having the highest taxable value)
Q4.I have billed my clients and rendered the services. However, the foreign exchange earnings have not been received. Can I still claim SEIS incentives? (Posted On: 12 Sep, 2020)

The SEIS incentives under FTP will be issued only on the amount which has been realized against the services rendered.
Q3.My GST Audit for the FY 2017-18 is still pending. Whether it can be done now? (Posted On: 12 Sep, 2020)

Yes sir, the filing of GST Annual Return along with GSTR 9C can be filed now with applicable late fees of Rs. 200 per day.
Q2.I am in business of Hydrated lime where my output is chargeable at 5% and inputs such as coal are chargeable at 28%? In 2017-18 only I have done business and ITC is also accumulated in ECL. I have no business from 18-19 onwards. Can I claim refund? (Posted On: 12 Sep, 2020)

As per Explanation 2 to Section 54 of CGST Act, the time limit of refund is only two years from the relevant date. In your case, the time limit starts from the end of financial year for which refund claim arises. Hence, the time limit in different months for financial year 2017-18 has expired on March 31, 2020. The time limit for the month of March 2020 should have been March 31, 2020 but it has been extended by notification number 35/2020 and 55/2020 to August 31, 2020 but it has also been expired. Hence, it is clearly time barred and no refund claim can be made.
Q1.Sir, My query is that Taxpayer is in the business of renting. Whether ITC on Crane purchase can be claimed which subsequently given on rent to earn income? (Posted On: 12 Sep, 2020)

Yes sir ITc on crane purchased can be claimed. There is no restriction for claiming ITC on crane under Section 17(5) of CGST Act,2017.
I have a doubt about the earlier regime, where Service Tax liability arises due to differences found in ST-3 and ITR etc.. Just Notice were served to calculate the actual figures. In such situations if Assesses pay the due payment with interest can Dept ask for 15 % Penalty without issuance of SCN. Clause 149 of FB 2016 says normal period of issuance SCN 30 months which is already passed as the last date of ST-3 filling was 15.08.2017.The time limit of 30 month will support in this situation. (Posted On: 11 Sep, 2020)

Sir in case there is notice for short payment of ST liability due to the differences in the actual ST liability paid with that computed on the basis of ITR, the said case falls in the ambit of fraud. And the time limit for issuance of notice shall be 5 years and not 30 months in your case. And as mentioned by you the penalty which the dept. has levied @15% is only in the case of fraud only, so the SCN is not time barred.
Hello, my firm wants to lease out a machine, so my query is in case of leasing of machine what value is being filed in the E-way bill ? (Posted On: 11 Sep, 2020)

In case the machine is sent on lease, the machine will be delivered to the recipient through delivery challan. In addition to this, the estimated value of the machine will be mentioned on the challan and e-way bill respectively generated.
I am having a query where tax invoice issued after the period prescribed under Rule 47 is held to be a valid tax invoice? (Posted On: 11 Sep, 2020)

Sir, As per Rule 47 of the CGST Rules, in case of taxable supply of service the invoicemust be issued within a period of 30 days from the date of supply of services.It is not mentioned anywhere in the Act or Rules that the tax invoice will not be a valid document in case the same is not raised within the prescribed time limit. However, as per Section 125 of the CGST Act,2017, if any person, who contravenes any of the provisions of this Act or any rules made thereunder for which no penalty is separately provided for in this Act, shall be liable to a penalty which may extend to twenty- five thousand rupees.
Sir, what is treatment for wastage of goods from 22/3/2020 to 31/3/2020 due to corona in case of restaurant and sweet shop where finished goods Rs 500000and Raw material Rs 1000000 waste in GSTReturn? (Posted On: 11 Sep, 2020)

In pursuance to provisions of sec 17(5) (h) ITC shall not be allowed in case of ?goods lost, stolen, destroyed, written off or disposed of by way of gifts or free samples?. In case you have availed the ITC on such stock, it is required to be reversed in GSTR3B. Coming specifically to the case of restaurant, since ITC was never allowed to restaurant in that case you don?t have to reverse any amount of ITC. Just written off entries are required to be passed in the Trading and Profit & loss account.
I have doubt on GSTR 9-9C, how to show excess tax paid in FY 2017-18 via GSTR 3B, which was adjusted in GSTR 3B of FY 2018-19 in GSTR 9. Since while filing GSTR 9 tax paid figures will be auto populated from GSTR 3B wherein less tax paid will be shown. How to deal with this? (Posted On: 11 Sep, 2020)

In GSTR 9, table 9 Tax payable will reflect from the actual supplies made in FY 2018-19 whereas tax paid will show the actual payment made via GSTR 3B. Supposedly, Actual Tax as per Books of Accounts 2018-19- Rs. 10,000. Actual Tax paid as GSTR 3B 2018-19- Rs.9,000 (Since we have adjusted excess paid tax of RS. 1000 of 2017-18 in 2018-19 GSTR 3B return.) Therefore, as per Table 9 of GSTR 9 i.e. in the column of Tax Payable, the actual tax will be less than Tax Paid in the financial year due to previous year adjustment. Proper Comment Should be Given in 9C along with reason of difference in auditors observation.
In my case, If a person receives commission for sales made in nature of High sea sales. Will this be subject to tax to tax? Or is it not forming part of supply? (Posted On: 10 Sep, 2020)

Ans.Yes, sir the commission received on supply is a separate transaction and shall be chargeable to GST. Only the High sea supply transaction has been included in schedule III which is kept outside the term of supply.
क्या GSTR 3B में आईटीसी खरीद बिलों के अनुसार क्लैम करनी चाहिए या जीएसटीआर 2बी के अनुसार? (Posted On: 10 Sep, 2020)

Ans Rule 36(4) of CGST Act, 2017 के अनुसार हमे जो भी आईटीसी GSTR 2A जो रिफ्लैक्ट हुई है हमे वो ही क्लैम करनी है। यह क्रेडिट हम GSTR 3B फ़ाइल करते समय ले सकते हैं। अगर हम सिर्फ बिलों के आधार पर लेते हैं और Rule 36(4) की अनदेखी करते हैं तो यह GST Rules का violation होगा और इस पर पेनाल्टी भी लगाई जा सकती है।
I have a query, whether GST shall be chargeable in case Mr. AB has provided some services in india for which the billing is done to the Mr. XY in Singapore in US $ terms and the payment is also received in US $ terms. The nature of service provided is vessel shipment inspection, My question is whether this will be treated as export of service or Mr. AB will have to charge GST? (Posted On: 10 Sep, 2020)

Ans Sir, firstly I would like to tell you about the ?Export of Service? as per Section 2(6) of IGST Act is defined as follows (i) the supplier of service is located in India; (ii) the recipient of service is located outside India; (iii) the place of supply of service is outside India; (iv) the payment for such service has been received by the supplier of service in convertible foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India; and (v) the supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in section 8; In your case supplier of service that is Mr. AB is located in India, recipient that is Mr. XY is located outside india and the payment is also received in foreign currency, however, the Place of supply of service is in india only which breaches the above condition for qualifying as ?export of service?. Hence it shall be taxable in India and GST shall be levied by Mr. AB on his invoice.
Sir, I have paid fees to advocate , whether it will chargeable to GST on RCM basis ,if yes then at what rate ? Moreover, whether I would be able to tale input of this RCM paid on advocate fees? (Posted On: 10 Sep, 2020)

Ans.Any payment made to advocate shall be liable to GST on RCM basis @18% in pursuance of notification 13/2017 where the list of services has been provided on which RCM is attracted. Coming to next query, the ITC on the RCM paid shall be available provided the same is in course of furtherance of business and related to the same business entity.
Sir, we are receiving bills in the name of M/s XYZ who is a freight and forwarding agent. M/s XYZ is acting as an agent between my firm and M/s ABC (Custom House Agent). The original bills of M/s ABC in respect of handling services, packing charges and other transportation services are reflected in our GSTR 2A. M/s XYZ is charging commission on the said services and we are liable to make the full payment to XYZ. The issue arises that credit in respect of handling services are reflected in our 2A in the name of ABC and commission related credit is shown in 2A in the name of XYZ. How the entry should be passed in our books of accounts so that it is convenient for us while reconciling GSTR 2A? (Posted On: 10 Sep, 2020)

Ans.The entries will be as follows i) Handling charges a/c dr. 10000 Input GST a/c dr. 1800 Transport Charges(RCM) a/c dr. 5000 To ABC a/c 16800 ii) ABC a/c dr. 16800 Commission a/c dr. 1000 Input GST a/c dr. 180 To XYZ a/c 17980
Hello Sir, I am acting as an intermediary between CHA and my client. CHA is raising three separate bills for ocean freight, handling services, terminal charges, packing charges, transporting goods and similar support services. Since ocean freight is exempted in case of exports, he is issuing bill of supply in this respect. However, on the 2nd bill and 3rd bill, he is charging IGST. I want to know that how should I raise invoice to my client for aforesaid mentioned services. I as well my client is registered in Rajasthan in GST. However, the CHA is registered in Mumbai (Maharashtra). (Posted On: 09 Sep, 2020)

As already discussed in the previous query, CHA is correctly raising its invoices separately for the services provided from Jodhpur to border line of India and from a place outside India to factory situated in India. For the first leg of journey, since the place of supply is location of registered recipient i.e. Jodhpur and location of supplier is in Maharashtra. Hence, he is correctly charging IGST in this respect. For another leg of journey which is outside India, the place of supply is outside India, hence IGST is chargeable. But since we are located in Rajasthan and so our client, hence we will be charging CGST and SGST for the services given from Jodhpur to border of India and IGST will be imposed from place outside India to factory situated in USA. We are acting as an agent in between the CHA and client, hence same provisions of place of supply will be applicable. Another aspect of this query is that what should be the rate charged for the services provided? In our opinion, all the services fall under the SAC code 9967 with description ?Supporting services in transport?, hence, it will be chargeable at the tax rate of 18%. Cargo handling services, Storage and warehousing services and all the supporting services for transportation of goods are classified under 9967. Notification no. 11/2017-Central Tax (Rate), Sl.No.11 (ii) provides that supporting services in transport other than those mentioned in (i) (Heading 9967) would attract CGST @9% taking the effective rate to 18% including SGST.
Sir, can we upload debit notes without giving reference to prior tax invoice now in GSTN? (Posted On: 09 Sep, 2020)

Yes sir the GSTN will enable the facility to upload multiple debit/ credit notes from 1st October 2020 after that there will not be any requirement to mention the invoice details. Till now there is no such functionality on the GSTN portal, so you have to mention the respective invoice details against which dedit note is issued.
Hello Sir, my unit is located in SEZ unit and we want to buy a car. Can we tell the supplier to get it a zero-rated supply? (Posted On: 09 Sep, 2020)

Yes sir, you are right supply made to SEZ unit is treated as zero-rated supply as per the sec 16(1) (b) of IGST act. The supply of car made to SEZ unit will be treated as zero-rated supply.
Sir in my case, credit note is issued but no output tax liability to adjust in further months due to the impact of Covid-19, is there any remedy available? (Posted On: 09 Sep, 2020)

Sir, as per the latest amendments made in the GST portal the negative figures can be mentioned in GSTR 3b in case there is only credit notes issued by the taxpayer and no output tax liability. So you can mention the same in GSTR 3b with negative figures but the same can only be adjusted in further months in which there is output tax liability.
My company has 4 branches in 4 different states. And my company does not want to register as ISD. How to avail the ITC? (Posted On: 09 Sep, 2020)

The input tax credit of service of one branch will not be distributed to the other branch. The only way to avail credit without registering as ISD is that the branch which avails the input service alone shall receive the invoice directly from its supplier irrespective of their location and it can avail the input tax credit. In that system, one branch cannot bear the expenses of supply of service of the other branch and so the input tax credit of service distribution does not arise. This may be difficult to follow practically as it is the common practice that a unit shall bear the expense of all branches for administrative convenience.
Proprietor running business. He purchased gold coins. What treatment he should give in books so that he can take input on gold coin ? (Posted On: 09 Sep, 2020)

As per our opinion, treatment in books of accounts cannot lead to allowance of credit. If the gold coin is for sales promotion like it is given to those clients of assessee who buys goods worth Rs. 1 crore in a month, then it is allowed. But if it is given as gift to friends of a director then the credit is not allowed as per the restrictions given under sec 17(5).
When advance of 10 crore is received by builder against ongoing construction of building, then whether GST Audit will applicable. RAJESH (Posted On: 08 Sep, 2020)
Hello Sir, I am availing services of CHA (Custom House Agent) for transportation of goods from Jodhpur to USA. My firm and CHA firm is registered in Rajasthan in GST regime. However, CHA is raising three separate bills for ocean freight, handling services, terminal charges, packing charges, transporting goods and similar support services. Since ocean freight is exempted in case of exports, he is issuing bill of supply in this respect. However, tax charged on the 2nd bill raised in respect of other above-mentioned services is CGST while on 3rd bill, he is charging IGST. I am little worried about the eligibility of credit. If the supplier has charged incorrect GST, then the department will ask us to reverse the credit too. Can you please confirm us about the applicability of tax under correct head for the aforesaid transactions? (Posted On: 08 Sep, 2020)

Section 12 of IGST Act, 2017 provides for determination of place of supply in case both the service provider and service receiver are located in India. As per sub-section (8) of Section 12, place of supply of services by way of transportation of goods shall be the location of recipient, if registered. Integrated Goods and Services Tax (Amendment) Act, 2018 was made effective from 01.02.2019 by Notification No. 01/2019-IT dated 29.01.2019. Among other amendments, a proviso was inserted in Section 12(8) of the IGST Act. The relevant provision is extracted as under: "Provided that where the transportation of goods is to a place outside India, the place of supply shall be the place of destination of such goods." Before the insertion of the proviso, the place of supply for transportation services was dependent on the location of the service recipient. If the service recipient was in the same state as that of service provider, then the supply was treated as intra-state supply and if the service recipient was in a different state, then the supply was considered as inter-state supply. Due to insertion of the proviso, the place of supply for exports shall always be outside India and thus supply shall always be inter-state supply, irrespective of the location of recipient. Therefore, the CHA is correctly raising its invoices separately for the services provided from Jodhpur to border line of India and from a place outside India to factory situated in India. For the first leg of journey, since the place of supply is location of registered recipient i.e. Jodhpur and location of supplier is in Rajasthan only. Hence, he is correctly charging CGST and SGST in this respect. For another leg of journey which is outside India, the place of supply is outside India, hence IGST is chargeable. Another aspect of this query is that what should be the rate charged for the services provided? In our opinion, all the services fall under the SAC code 9967 with description ?Supporting services in transport?, hence, it will be chargeable at the tax rate of 18%. Cargo handling services, Storage and warehousing services and all the supporting services for transportation of goods are classified under 9967.
Q3.Sir, I have one query: Suppose A enters in MOU with B for specialized purpose. The MOU will operate in name of A, only and for this A will charge royalty. My query is whether that royalty will subject to GST. And if yes then on whose hand? (Posted On: 08 Sep, 2020)

In the instant case GST shall be taxable in the hands of A as he is receiving royalty. Mere entering into MOU will not discharge the liability to not pay tax. A being the service provider will have to pay tax on the royalty amount received by him.
Q2.जनवरी 20 में किसी व्यापारी ने रिटर्न जमा करवाते time 98000 की लेटफीस जमा करवाई, क्या उसका रिफंड ले सकते है ? (Posted On: 08 Sep, 2020)

Sir, लेटफीस के रिफ़ंड का प्रोसीजर नहीं है। हालांकि GSTN ने 01 July 2020 को अपने ट्वीट के माध्यम से लिखा था की excess late fees जो नोटिफ़िकेशन से ज्यादा चार्ज हुई है उसे re-credit कर दिया जाएगा, जिसका अभी तक कोई procedure नहीं आया |
Q1.Pre-Deposit @ 7.5% require or mandatory for filling Appeal in case of confiscation of goods wherein Redemption fine and Penalty imposed was paid under Custom Law. Seeking its Refund that can be after filling Appeal. Our query is pre deposit is required in such cases wherein duty elements not involved. Only Appeal to be file for Redemption Fine and Penalty. Second its Refund can be 100% or become lesser. (Posted On: 08 Sep, 2020)

As per Section 129E of Customs Act, 1962 if a person has to deposit 7.5% of duty, if duty and penalty is in dispute. The appellant has to deposit 7.5% of penalty if penalty is in dispute. Hence, in this case, 7.5% of penalty is to be deposited.
Notification No. 8/2018 about the sale of old car is applicable to person dealing in second hand cars or is it applicable to every registered person. Aashish jain (Posted On: 07 Sep, 2020)
Q5.हमारी पास एक तेल का मिल है वो बिनोला ओर लाहा खरीदता है और उसमें से तेल और खल निकलती गई खरीद बी 2 बी की है जिस पर वो टैक्स देके आता है परन्तु जब वह माल की पिलाई करता है तो माल में से 30 प्रतिशत तेल निकलता है जो टैक्स के दायरे में है और वाकी जो निकलता है टैक्स फ्री है तो उसकी बची हुई आई टी सी रिफण्ड होगी या नही (Posted On: 07 Sep, 2020)

Inverted duty refund में रिफंड तभी मिलता है जब इनपुट पर टैक्स की दर ज्यादा हो और तैयार माल पर टैक्स की दर कम हो। परंतु उपरोक्त सवाल में ड्यूटी ज्यादा होने का कारण input-output ratio बताया गया है। इस स्थिति में रिफंड तो नहीं मिलेगा अपितु दो तरह के प्रोडक्ट taxable और exempt होने के कारण proportionate reveral सेक्शन 42/43 के तहत करना पड़ सकता है।
Q4.Sir for how long we have to maintain the records under GST Law. (Posted On: 07 Sep, 2020)

Ans. Accounts and records for a financial year under the GST Law can be retained up to 72 months from the due date of filing of annual returns for such financial year.
Q3. Sir, for FY 2019-20 what is the last date for filing GST Annual Returns? (Posted On: 07 Sep, 2020)

As per sec 44 of the CGST Act 2017, the last date for filing GST Annual return for the fy 2019-20 is 31st Dec 2020. Relevant portion of Sec 44 is Every registered person, other than an Input Service Distributor, a person paying tax under section 51 or section 52, a casual taxable person and a non-resident taxable person, shall furnish an annual return for every financial year electronically in such form and manner as may be prescribed on or before the thirty-first day of December following the end of such financial year.
Q2.We are manufacturer, we have received a bill on which the supplier has charged freight after charging GST on the taxable value of goods only. Whether we have to pay RCM in case supplier has not charged GST on Freight amount? (Posted On: 07 Sep, 2020)

Sir, in the instant case the supplier should have charged GST including the freight amount as the same is covered under composite supply as per sec 2(30) of the CGST Act. Even the illustration given in above Section ibid gives example on the same topic.The liability to pay RCM does not arise if the supplier has not charged GST on freight amount in his tax invoice. Instead RCM liability arises in case the fright amount is paid by us to the GTA on the basis of a consignment note only.
Q1. Sir, in Pre-GST period automobile cess was charged in invoice. Can we claim it as an eligible for transactional credit u/s 140 of GST Act,2017. Kindly solve my problem. (Posted On: 07 Sep, 2020)

The transitional provision contained in Section 140 read as follows:- (1) A registered person, other than a person opting to pay tax under section 10, shall be entitled to take, in his electronic credit ledger, the amount of CENVAT credit of eligible duties carried forward in the return relating to the period ending with the day immediately preceding the appointed day, furnished by him under the existing law in such manner as may be prescribed. The Explanation1 to Section 140 provided meaning of ?eligible duties? for sub-section 1,3,,4 &6. The explanation 2 provided a list of ?eligible duties and taxes? for sub-section 5. But these both lists do not contain Automobile cess. Hence, it cannot be carried forward.
Whether data for GSTR-3B will prevail over GSTR-1 for reporting in GSTR-9? (Posted On: 05 Sep, 2020)

As per clarifications/press release, Irrespective of when the supply was declared in FORM GSTR-1, the principle of declaring a supply in Pt. II or Pt. V is essentially driven by when tax was paid through FORM GSTR-3B in respect of such supplies. Hence for the purpose of Reporting in GSTR 9, data as reported in GSTR 3B will prevail over GSTR 1.
Whether there is auto-population in GSTR 9 of FY 2018-19, relating to figures reported in GSTR 9 for FY 2017-18, relevant to FY 2018-19? (Posted On: 05 Sep, 2020)

No such facility has been provided by government. Table 8C, Table 10 to Table 14 from FY 2017-18, have no auto-population/reporting in GSTR 9 of FY 2018-19
I have not filed all my applicable statement(s) during the financial year. Still, can I file Form GSTR-4 Annual return without filing of those applicable statement(s)? (Posted On: 05 Sep, 2020)

No. You cannot file Annual return in Form GSTR-4 without filing Form CMP-08, for the applicable period/periods, of the relevant financial year. The button to file Form GSTR-4 (Annual Return) will get enabled only after you have filed Form GST CMP-08 for the all applicable quarters of the relevant Financial Year.
Whether provision of section 18(6) applicable on services also which are capitalized in the books of accounts? (Posted On: 05 Sep, 2020)

As per section 18(6) which is reproduced below: ?In case of supply of capital goods or plant and machinery, on which input tax credit has been taken, the registered person shall pay an amount equal to the input tax credit taken on the said capital goods or plant and machinery reduced by such percentage points as may be prescribed or the tax on the transaction value of such capital goods or plant and machinery determined under section 15, whichever is higher: Query may come in the mind that since section 18(6) specifies word ?Capital goods?, so one need to compute surrender of ITC on only capital goods and not on the services (like, Work contract services) which were capitalized in construction of the said capital assets. Since the provision contained in Rule 43 (Proportionate reversal of ITC in case of assets used for taxable as well as exempted supplies) also covers only goods as specifically mentioned there, there might be intention of the law maker to exclude services from the calculation of reversal of ITC for the purpose of section 18(6) also.
Will businesses now be required to generate e-invoices on the GST portal or the e-invoice portal? (Posted On: 05 Sep, 2020)

No, the businesses now be required to generate e-invoices on the GST portal or the e-invoice portal.The tax payer will first prepare and generate his invoice using his ERP/accounting system or manual system and then upload these invoice details to IRP and get the unique reference number, known as IRN.The e-invoice does NOT mean preparation or generation of tax payer?s invoice on government portal.It is only intimating the government portal that invoice has been issued to the buyer, by registering that invoice on the government portal.
what is the maximum cash amount of GST tax invoice in a single invoice? (Posted On: 04 Sep, 2020)

Apparently there is no limit for tax invoice. It seems that this query is relating to exemption for paying GST on supply of goods and services from unregistered persons. The limit for such transactions was Rs. 5000/- per day. However, this provision has been kept in abeyance as on date.
In case of hiring of manpower service the bill raised by the client is (Basic WAGES+EPF+ESI+SERICE CHARGE). Whether GST is calculated on the Basic wages or on the (Basic+EPF+ESI+SERIVE CHARGE) . PLS CLARIFY (Posted On: 04 Sep, 2020)

GST is payable On Total Cost (Wages+PF+ESI+Service Charge). As the valuation Section 15 of CGST Act reads as follows ?(2) The value of supply shall include??? (a) any taxes, duties, cesses, fees and charges levied under any law for the time being in force other than this Act, the State Goods and Services Tax Act, the Union Territory Goods and Services Tax Act and the Goods and Services Tax (Compensation to States) Act, if charged separately by the supplier;?
A manufacturer (company) is located in Jharkhand. The officials of the company travel to different states for official work and stay in different hotels. Please clarify 1. In Hotel bill which would be in the name of the company, what will be the place of supply? 2. IGST would be charged or CGST + SGST. 3. Whether the company can claim the credit of the same? (Posted On: 04 Sep, 2020)

a. Place of supply will be where hotel is situated and the hotel will charge local SGST and CGST. This is as per the provision of Section 12(3)(b) of IGST Act which is as follows ?(3) The place of supply of services, ?. (b) by way of lodging accommodation by a hotel, inn, guest house, home stay, club or campsite, by whatever name called, and including a house boat or any other vessel; or shall be the location at which the immovable property or boat or vessel, as the case may be, is located or intended to be located? b. CGST and SGST of that State. c. legally if you give your GSTIN you can take Input Tax credit for CGST for CGST ? SGST of that State cannot be taken for SGST for your State. Hence, credit will not be available.
IF GTA engaged in transportation of goods by road, takes voluntary registration under GST, will he be liable to collect and pay GST even if he provide services to Company or the provisions of reverse mechanism will still apply. (Posted On: 04 Sep, 2020)

No, mere registration does not mean that he has opted for paying GST on GTA under forward charge. He has to opt for forward charge then he will pay under forward charge. But otherwise, reverse charge will be applicable. Many registered transporter are asking companies to pay GST under reverse charge mechanism.
Hello everyone, One of my client made wrong reversal of itc of Rs 10000 in igst instead of cgst n sgst....my question is 1. Do they need to pay cgst n sgst 5000 each, if yes then another question mentioned below 2. There is more reversal need to be done of Rs 5000 each which is not done yet in igst, cgst, sgst. Can we adjust the reversal of Rs 15000 with wrong reversal of igst of Rs 10,000 mentioned in point 1? I m filing GST annual return & audit both in case of above assesse (Posted On: 04 Sep, 2020)

For the first question, payment of Rs. 5,000/- is to be done in CGST and SGST each along with interest through Form DRC-03. This has been clarified by way of press release issued on 3rd July 2019. On ?Clarification regarding Annual returns and Reconciliation Statement?. Coming to the next question whether reversal of Rs. 15,000 can be adjusted against the wrong reversal made in IGST of Rs. 10,000/-. In this care is to be taken that the date of actual reversal and date of reversal made are same. Otherwise interest is to be paid accordingly from the date of actual reversal required to be made and reversal done in returns. Further payment of Rs. 5,000/- in IGST is to be done along with interest through DRC-03.
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My bank is charging GST on EMI s Interest portion but as per definition of service ?Money is excluded from the same. Hence, please clarify whether GST levied by Bank is correct or not. If correct, then please specify with GST provision. (Posted On: 03 Sep, 2020)

GST is not leviable on the interest component. It is charged on bank charges. If your bank is charging GST then it would be on bank charges. However, it is advisable to get clarity from the bank.
I have exported goods from Rajasthan to USA and have appointed CHA for transportation. He charges CGST and SGST for transportation from Rajasthan to Mumbai port and charges IGST from India Port to Foreign port. Is this correct? (Posted On: 03 Sep, 2020)

Before proceeding to answer the question let us have a look at the provisions of Act. Section 12 of IGST Act deals with ?Place of supply of services where location of supplier and recipient is in India?. Sub section 8 of this section reads as follows ?(8) The place of supply of services by way of transportation of goods, including by mail or courier to,?? (a) a registered person, shall be the location of such person; (b) a person other than a registered person, shall be the location at which such goods are handed over for their transportation. Provided that where the transportation of goods is to a place outside India, the place of supply shall be the place of destination of such goods.? So in first case, both the service provider and receiver are in India, therefore the location shall be that of the service recipient which shall attract CGST and SGST. In the second transaction is from the India port to foreign port, the proviso will come into play. The place of supply in that case will be place of destination of goods. Hence, it will be USA and hence place outside India. Now, the supplier is in India but place of supply is outside India. Hence, IGST will be charged. Hence, GST charged on both the transactions is correct.
Goods sold before GST which are exempted before GST and know some of the goods are damaged and buyer wants to return and now goods are taxable under GST regime. Then how they sent goods (via invoice or voucher)? (Posted On: 03 Sep, 2020)

As the movement of goods is happening post implementation of GST and also the period of 6 months from the rollout is over, the goods has to be shipped with the tax invoice only.
XYZ is an 100% EOU unit. They import raw material without payment of Customs Duty and IGST. However, presently the goods manufactured from these raw materials are supplied only in domestic market and at the time of supply they pay appropriate customs duty and IGST. 1) Can the authorities object to this on the ground that when XYZ know that it is going to be used for supply in domestic market how they can claim customs duty and IGST exemption? 2) While manufacturing, certain raw materials and finished goods gets rejected on which customs duty and IGST is not paid. Will this be objected? (Posted On: 03 Sep, 2020)

Answering the first question there is no such permissible limit in law. When XYZ supplies finished goods in domestic market then reversal of appropriate Basic customs duty forgone on inputs used in manufacture of such final product as well as payment of IGST on such final product is to be done. Coming to the next question, it would not make any difference if raw material gets rejected during manufacture.
A client gives out 1) free samples of its products and 2) pens, bottles, etc. with their brand name on it, as promotional material. Both are without charging anything to its dealers/distributors. Currently, they reverse the ITC on these products and recognise it as a cost, because they are being sold for free. In future, they would like to sell these for a nominal price of Rs 1/ Rs 2 and use the full ITC instead of reversing. Is there any issue with this? (Posted On: 03 Sep, 2020)

As per section 17(5) pertaining to blocked credits ?(h) goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples;? which clearly restricts the ITC on supply of free sample irrespective of the fact it is provided at a nominal price. Coming to the next point of availment of credit on pens, bottles with brand name printed on it, credit shall be availed as it is used as sales promotion and these are not free samples. Circular number 92/11/2019-GST dated 7/3/2020 may be referred for this purpose wherein it is clarified that on purchase of one item, other is free. This mean that a single price is charged for both items. Similarly, in this case, pen etc is given free on supply of certain specified items.
A client gives out 1) free samples of its products and 2) pens, bottles, etc. with their brand name on it, as promotional material. Both are without charging anything to its dealers/distributors. Currently, they reverse the ITC on these products and recognise it as a cost, because they are being sold for free. In future, they would like to sell these for a nominal price of Rs 1/ Rs 2 and use the full ITC instead of reversing. Is there any issue with this? Kaustubh Karandikar (Posted On: 02 Sep, 2020)
As per Rule 32, value of transaction of foreign exchange dealers is 1% of the INR in case RBI exchange rate is not available. In that case, a foreign exchange dealer does a transaction of say Rs. 1,00,000/- but GST is to be paid only on 1% i.e. Rs. 1000/-. When we compare the financial statements of a foreign exchange dealer with GST returns, there will be this difference of 99%. Can this 99% be shown under exempt supply so that there's no difference between GST returns and financial statements (Posted On: 02 Sep, 2020)

The difference of 99% cannot be termed as exempt supply and hence need not be shown in GSTR-3B as exempt supply.
Can anyone tell me the rate of GST charged by a sub-contractor from a government contractor (Posted On: 02 Sep, 2020)

The following rates shall be applicable depending on the type of services being provided. As per Notification no. 1/2018-Central Tax (rate) dated 25th Jan 2018 states as follows ?(ix) Composite supply of works contract as defined in clause (119) of section 2 of the Central Goods and Services Tax Act, 2017 provided by a sub-contractor to the main contractor providing services specified in item (iii) or item (vi) above to the Central Government, State Government, Union territory, a local authority, a Governmental Authority or a Government Entity. 6 Provided that where the services are supplied to a Government Entity, they should have been procured by the said entity in relation to a work entrusted to it by the Central Government, State Government, Union territory or local authority, as the case may be. (x) Composite supply of works contract as defined in clause (119) of section 2 of the Central Goods and Services Tax Act, 2017 provided by a sub-contractor to the main contractor providing services specified in item (vii) above to the Central Government, State Government, Union territory, a local authority, a Governmental Authority or a Government Entity. 2.5 Provided that credit of input tax charged on goods and services has not been taken [Please refer to Explanation no. (iv)].
Since GST implementation while filing 3B monthly returns purchase returns were shown as netted off against the purchases in part A Table 4(A)(5) instead of showing in part B (2) others for reversal ....what is the consequences for the same and how to overcome this for returns filed earlier.... (Posted On: 02 Sep, 2020)

The correct way to present data in the return is show under ?All other ITC? and the reversal in either ?Rule 42, 43? or others but you have shown the data by netting it off. This does not make effect on outward liability. But yes explanation for the same is to be kept ready in case if required in future.
In case of transportation of goods by road to Nepal / Bhutan, payment for freight is being made by consignor of India. Will this be considered as export of service to Nepal and subsequently eligible for exemption as per Notification no. 30/2017 dated 29-09-2017?? (Posted On: 02 Sep, 2020)

Export of Service as per Section 2(6) of IGST Act is defined as follows ?(i) the supplier of service is located in India; (ii) the recipient of service is located outside India; (iii) the place of supply of service is outside India; (iv) the payment for such service has been received by the supplier of service in convertible foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India; and (v) the supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in section 8;? In the present scenario supplier of service that is the transporter is located in India, recipient that is the consignor is located in India. Coming to place of supply since both service provider and receiver are in India then Section 12(8) shall be attracted and the place of supply shall be the location of recipient which is in India. The next condition says payment is received in foreign currency or in Indian rupees as permitted by RBI. Since second and third conditions are not getting satisfied, it shall not be considered as Export of Service to Nepal.
Can ITC be obtained on Water bottles on which GST is charged? (Posted On: 02 Sep, 2020)

This is a matter of dispute. Section 17(5) pertaining to blocked credit used the term ?food and beverages?. Some of the experts are of the opinion that water is not part of beverage as Google defines beverage as ?a drink other than water? and so credit can be availed. But some believe that it is part of beverage and credit is ineligible.
I want to sign my invoice using Digital Signature. Is it possible to do so and what is the procedure to sign it electronically? (Posted On: 01 Sep, 2020)

. As per Rule 46(q) ?signature or digital signature of the supplier or his authorised representative was must on the invoice.? This rule has been amended vide notification No. 74/2018 Central Tax dated 31st Dec 2018 to add a proviso which states as under, ?Provided also that the signature or digital signature of the supplier or his authorised representative shall not be required in the case of issuance of an electronic invoice in accordance with the provisions of the Information Technology Act, 2000 (21 of 2000).? So it is valid to sign the invoice by use of Digital signature. Procedure to sign the invoice using DSC is as follows a. In order to make use of the digital signature, you must first obtain your Digital Signature Certificate by applying for the same with any of the registered Certifying authorities. On receiving your DSC and the USB Token attachment you can easily make use of it to sign any PDF document online. b. Convert your invoice into PDF. Then Right-click in the PDF document where you want to add the Digital signature. c. Select Sign Document from the right-click menu. d. Select Digital Signature and then Click Affix Signature to add the signature to your document.
Can an exception be made for maintenance of books of account? (Posted On: 01 Sep, 2020)

Yes, as per provisions of section 35(4), in case any class of taxable persons is not in a position to keep and maintain accounts in accordance with the provisions of section 35, the Commissioner may permit such class of taxable persons to maintain accounts in such manner as may be prescribed after recording the reasons for the same in writing.
Tax consultant registered under GST regular taxpayer. Can he go for composition. If yes, can he opt-in now? (Posted On: 01 Sep, 2020)

Tax consultant is a service provider and there is separate composition scheme for service provider prescribed by Notificaiton number 2/2019 dated 7/3/2019. If his turnover is below Rs. 50 Lakhs then he can opt for the same. All other terms and conditions of above notification are satisfied.
XYZ Ltd. (Maharashtra) has purchased moulds from PQR (Chennai). Moulds will be delivered directly to XYZ?s supplier manufacturer named ABC in Chennai. ABC will use the moulds to make the products and sell the products to XYZ. On receipt, XYZ sells these products to its customers. XYZ does not charge ABC any amount for use of these moulds. Ownership of the moulds remains with XYZ. 1) Can XYZ claim ITC of moulds even though the moulds will not be received in the premises of XYZ? (Posted On: 01 Sep, 2020)

. In order to avail credit the following credit needs to be satisfied as per the provisions of Section 16. 1. Possession of a tax invoice or debit note or document evidencing payment 2. Receipt of goods and/or services 3. Goods delivered by supplier to other person on the direction of a registered person against a document of transfer of title of goods 4. Furnishing of a return Since the second condition is not getting satisfied it seems that the credit shall not be available. But a Explanation has been inserted vide CGST amendment Act 2018 which reads as follows ?Explanation.?For the purposes of this clause, it shall be deemed that the registered person has received the goods or, as the case may be, services?? (i) where the goods are delivered by the supplier to a recipient or any other person on the direction of such registered person, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise; (ii) where the services are provided by the supplier to any person on the direction of and on account of such registered person.? On reading of the above explanation it appears that the credit shall be available to XYZ.
Can any one share ITC 04 form due dates from July 2017 to June 2020? (Posted On: 01 Sep, 2020)

Notification No. 38/2019-Central Tax dated 31st August 2019 was issued wherein the requirement of filing GST Form ITC-04 for the period July 2017 till March 2019 has been waived. Such registered persons would, however, be required to furnish details of all challans in respect of goods dispatched to job worker during the said period but not received back or not supplied from the place of business of the job worker, as on the 31st of March, 2019. This information is required in serial number 4 of FORM ITC-04 for the quarter April-June 2019. Notification No. 32/2019-Central tax dated 28th June 2019 has been issued wherein the due date for filing of return for the period April 2019 to June 2019 is extended to 31st August 2019 Due date for the period July ? September 2019 is 25th October 2019 and for the period October ? December 2019 is 25th January 2020. Due to COVID -19 pandemic spread the due date for filing ITC-04 for the period Jan 2020 to June 2020 is 31st August 2020 by notification 55/2020. This is being presented in tabular form for Quick reference Period Due Date July 2017 to March 2019 Waived April to June 2019 31st August 2019 July to September 2019 25th October 2019 October to December 2019 25th January 2020 January to June 2020 31st August 2020
Can you please guide on where can I find the new facility provided by government of Form GSTR-2B on portal? What are the contents of this form? (Posted On: 31 Aug, 2020)

Ans. The following are the steps to access GSTR 2B Step 1: Log in to the GST portal. Step 2: Navigate to the ?Returns Dashboard?. Step 3: Select the relevant tax period. Select the month and year. Step 4: Click on the ?GSTR-2B? tab. Step 5: Click on the ?Download? button to save the statement on your system. The contents of GSTR-2B are as follows: 1.Summary statement showing ITC available and non-available for every section. 2.Advisory for every section that clarifies the kind of action that taxpayers must take. 3.Document-wise details such as invoices, credit notes, debit notes, etc. to view and download. 4.Cut-off dates and advisory for generating and using GSTR-2B. 5.Import of goods and import from SEZ units/developers (available from GSTR 2B of August 2020 onwards).
Whether a composition taxpayer who has converted into regular taxpayer during last year only also has to file gstr 4 annual return (Posted On: 31 Aug, 2020)

Ans. Yes, you are required to file the annual returns under form GSTR 4 for the financial year even if your registration is cancelled or you opted out of the scheme.
A partner retires from a firm, and takes with him a part stock in trade as settlement. What would be the implication? (Posted On: 31 Aug, 2020)

Ans. In our opinion, it will be treated as supply and GST is to be charged on the part of Stock in trade given as settlement in case of his retirement. Even the partner will get the credit on this stock only if partnership firm pays the tax on the same.
If I want to pay interest on only sgst through 3B , the same is not possible equivalent amount needs to be paid under cgst also...any solution for this ...if no then I was planning to pay interest by DRC 03 (Posted On: 31 Aug, 2020)

Ans. If interest liability arises only on SGST portion then there is no way around except paying through DRC-03 as Form GSTR-3B does not accepts similar amounts for both CGST and SGST.
What is the time of supply for debit notes? (Posted On: 31 Aug, 2020)

Ans:The query points about the concept of time of supply. Section 12 and Section 13 of the CGST Act,2017 specifies the time of supply of goods and services respectively. There is no time of supply for debit notes. However, as per our understanding, the query is relating to the last date of issuance of debit notes in any financial year. There is no such provision in law specifying the right time to issue debit note. But in this regard, we would like to mention the provisions of Section 16(4) of the CGST Act,2017. Section 16 of CGST Act, 2017 deals with ?Eligibility and Conditions for taking input tax credit?. ?(4) A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or invoice relating to such debit note pertains or furnishing of the relevant annual return, whichever is earlier.? So in order that the recipient shall avail the Input tax credit of such debit note, he needs to issue before the September or the day of filing of Annual return whichever is earlier
Q5. There is query for export... Invoice date is of July 2020 and Shipping bill date for export is of Aug 2020 (1) Is it part of GST return of which month July 2020 or Aug 2020? (2) In tally also in which month to be entered July 2020 or Aug (Posted On: 29 Aug, 2020)

Ans. Invoice Date of July 2020 is to be considered in the case of both GST return (to be reflected in the month of July 2020 itself) and tally as well
Q4. A taxable person supplied services to a PSU. He believed that these were exempted from 2017-2018. At the time of filing of 9C for 17 18, objection was raised by auditor that these services are not exempt. They paid the full tax using DRC-03. Now can the service provider issue tax invoices now (as he has not done till now as per Rule 46) and pass on the tax to the recipient? (Posted On: 29 Aug, 2020)

If the service provider intends to issue tax invoices in order to pass on the tax to the recipient it would be of no help. As per the provision of Section 16(4) which is given here for quick reference, credit cannot be availed by recipient for the Financial Year 2017-18. ?A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or invoice relating to such debit note pertains or furnishing of the relevant annual return, whichever is earlier.?
Q3. ITC for FY 2019-20, wrongly claimed in 3b of Telangana instead of Maharashtra...can it be corrected in annual return? (Posted On: 29 Aug, 2020)

The time limit for availment of credit as per the provisions of Section 16(4) of CGST Act is the due date of filing the GST l Return for the month of September of the next financial year to which this invoice elate or the date of filing the annual return for that financial year, whichever is earlier. There is no time limit for reversal of credit. Since the time for claiming credit for FY 2019-20 is the due date of filing return of September 2020, the mistake can be rectified by availing credit in the state of Maharashtra and reversal has to be done in the state of Telangana along with interest. If you wish to rectify through annual return then credit cannot be claimed in the state of Maharashtra but it is to be reversed in the state of Telangana along with payment of Interest.
Q2. I have a query, one of my client who has availed credit by taking ITC in 3b subsequently he found that it was intelligible instead of reversing in3b they have offset the reversal amount in books ITC and claimed only net in 3 b in the subsequent year what will be the impact of this (Posted On: 29 Aug, 2020)

In our opinion the correct way to reversal the credit is by showing it under Table 4B of GSTR-3B instead of reducing from the credit especially when it pertains to other Financial year.
Q1. What is the time limit specified in GST law to issue debit note? Understand there is no end timeline but what is the right time as per to issue Debit note. (Posted On: 29 Aug, 2020)

Ans. There is no such provision in law specifying the right time to issue debit note.
Can the provisions of Sections 73 or 74 be made applicable for not maintaining books of account? (Posted On: 28 Aug, 2020)

Yes, where the registered person fails to account for the goods and/or services in accordance with Section 35(1), the proper officer shall determine the amount of tax payable on the goods and/or services that are not accounted for, as if such goods and/or services had been supplied by such person, and the provisions of Sections 73 or 74, as the case may be, shall apply, mutatis mutandis, for determination of such tax
Will the out-of-pocket expenses charged by professionals to claim reimbursement of expenses incurred by them for rendering services to their clients be included in the transaction value? (Posted On: 28 Aug, 2020)

Yes. Any expenses incurred by the supplier relating to supply until the services are delivered, and which are charged to the recipient, will have to be included in the transaction value.
Time of supply where services are supplied online? (Posted On: 28 Aug, 2020)

The CGST Act, 2017 does not provide separate provisions for ascertaining the time of supply of service where such services are supplied online and hence the same provisions for services as discussed above will apply for services supplied online.
5.Is there any specific set of details to be maintained by a supplier of service? (Posted On: 27 Aug, 2020)

Ans. Yes. As per Rule 56(13) of the CGST Rules, 2017, a supplier of service is required to maintain quantitative details of goods used in provision of services, details of input services utilized and services supplied.
4.How do we file our SEIS application, if we render multiple services? (Posted On: 27 Aug, 2020)

Ans. Form ANF 3B seeks ?service category information? from the exporter. Therefore, the exporter needs to classify the eligible services as per Appendix 3D and claim the incentive accordingly.
3.I am a job worker and have received Cylinder for printing purpose. There is some problem in the Cylinder and we want to send it for Re engraving of the cylinder to another Job worker. Can I do so or has challan to be issued by Principal? (Posted On: 27 Aug, 2020)

Ans. Circular no. 8/12/2018 dated 26.03.2018 has been issued clarifying the issues related to Job Work. The relevant portion is being given here for quick reference. ?(ii) Where goods are sent from one job worker to another job worker: In such cases, the goods may move under the cover of a challan issued either by the principal or the job worker. In the alternative, the challan issued by the principal may be endorsed by the job worker sending the goods to another job worker, indicating therein the quantity and description of goods being sent. The same process may be repeated for subsequent movement of the goods to other job workers. ? ?. ?. (v) Where goods are returned in piecemeal by the job worker: In case the goods after carrying out the job work, are sent in piecemeal quantities by a job worker to another job worker or to the principal, the challan issued originally by the principal cannot be endorsed and a fresh challan is required to be issued by the job worker.? Challan can be issued by the first Job worker and the manner of issuing depends on the situation that is whether it is sent in piecemeal basis or at a time.
2.A customer may avail numerous services from the Bank / insurer in a given taxable period. Is it mandatory for Banks to issue a tax invoice for each transaction or can the Bank issue a consolidated invoice for the service rendered during the tax period? (Posted On: 27 Aug, 2020)

Ans. As per the provisions contained in the first proviso to Rule 47 of the CGST Rules, 2017 an insurer, a banking company or a financial institution, including a NBFC may issue invoices within 45 days from the date of supply of service. Further, sub-rule (2) of rule 54 of CGST Rules, 2017 provides that such entities may issue any other document in lieu of the tax invoice. Accordingly, such entities may issue a consolidated statement/ invoice/ advice to the customer at the end of the month, with the details of all the charges levied during such month and GST payable thereon.
1. Can I avail credit of Items of gift given to Known persons (related to business) and Employees? (Posted On: 27 Aug, 2020)

Ans. Section 17(5)(h) pertaining to blocked credit reads as ?goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples;? So credit relating gifts given cannot be availed be it given to Known persons or Employees. The gifts are provided without any consideration & hence, ITC needs to be reversed or should not be taken.
XYZ is supplying Gas Cylinders to PQR. XYZ is taking security deposit from PQR against this supply. At the year end XYZ is paying interest to PQR against this security deposit received. Is PQR required to pay GST on such interest received? Kaustubh Karandikar (Posted On: 25 Aug, 2020)
What will be the results, in case proper officer fails to take any action in respect to Aadhar verification for GST Registration? (Posted On: 25 Aug, 2020)

If applicant successfully undergoes aadhar authentication, Registration will be granted within 3 working days from the date of submission of application. If applicant does not opt for aadhar authentication or fails to authenticate aadhar number, Registration will be granted within 21 working days from the date of submission of application.
What is the effective date of Aadhar authentication? (Posted On: 25 Aug, 2020)

This Rule will be effective from 21′ August, 2020.
One of my clientis engaged in the export of services. He receives advance for the service to be rendered. Any advance received for the provision of service is taxable. What is the position with respect to the advance received for the export of services? (Posted On: 25 Aug, 2020)

In our view there is no need to pay tax on advance in case where there is export of service. But there is no express provision in law for this.
The following are the details for a exporter company. Export turnover: Rs 100 crores, MEIS Scrip sale: Rs 2 crore. Should ITC reversal be done for common input services and capital goods? or reversal to be done in whole on inputs, Input Service and Cap. Goods? Is any option available for not doing the reversal? (Posted On: 25 Aug, 2020)

Sir, Reversal is to be done for common Input, inut services and capital Goods itself but not for the whole credit in input, input services and capital Goods. There is no other option available for not doing reversal. Further, in our opinion, only input services will be common and no input and capital goods are normally used in applying MEIS scrips. Furthermore, input services exclusively used in exempted services in instant case are very rare e.g. a bill of consultant for applying MEIS. Furthermore, if MEIS are used in importing inputs or capital goods by the company then it will not be treated as exempted service. It will be treated as exempted only in those cases where MEIS are sold.
A Company has ISD registration for its Head Office in Tamil Nadu. The company has two plants, one in Pondicherry and other in Tamil Nadu. Company has obtained normal registration for both of its factories. Now if the company has to cross charge the service of its head office to its plants, will the company be required to obtain a regular registration for its Head Office in addition to ISD registration of head office? Further what are the services of Head Office (other than salary) to be considered for cross charge? (Posted On: 25 Aug, 2020)

In order to cross charge the service of head office to its plants, Head Office is required to obtain regular registration apart from the ISD registration already obtained. The various expenses which are services in nature incurred by head office can be used for cross Charge and can be distributed as Input service distribution.It will vary from company to company and is to be seen from accounts of each company.
5.Before submission of e-way bill, the system is not allowing to edit the details. What is the reason? (Posted On: 24 Aug, 2020)

Ans. The system allows editing the details of e-way bill entries before submission. However, if the products/commodities details are entered, it will not allow editing some fields as the tax rates will change. To enable this, please delete the products and edit the required fields and enter the products again.
4.Whether retreading of tyres is a supply of goods or services? (Posted On: 24 Aug, 2020)

In retreading of tyres, which is a composite supply, the pre-dominant element is the process of retreading which is a supply of service. Rubber used forretreading is an ancillary supply. Which part of a composite supply is the principal supply, must be determined keeping in view the nature of the supply involved. Value may be one of the guiding factors in this determination, but not the sole factor. The primary question that should be asked is what is the essential nature of the composite supply and which element of the supply imparts that essential nature to the composite supply. Supply of retreaded tyres, where the old tyres belong to the supplier of retreaded tyres, is a supply of goods.
3.Plz suggest, whether a partnership firm having GST registration, who is providing security services to different clients, can raise bill under RCM? The firm is already raising taxable invoice with GST to other clients but some of the clients is asking for RCM invoice? Please suggest (Posted On: 24 Aug, 2020)

Notification No. 29/2018 Central Tax (Rate) dated 31.12.2018 was issued stating the applicability of RCM in certain cases. One of conditions for applicability of RCM on security services is that it should be provided by a person other than a body corporate. Thus, body coproate has to charge forward charge. And Second condition is that recipient should be registered person. Hence, if the recipient is unregistered then provider of service should charge bill under forward charge. From above, it is clear that forward charge bill is to be raised in following two conditions:- 1. When provider is body corporate; and 2. When provider is not body corporate but recipient is unregistered. As in your case, you are provider of service and you are not a body corporate (partnership firm). You will fall under second category and RCM is applicable when provided to registered person. Invoice is to be issued on RCM basis only. The relevant part of the notification is reproduced here for quick reference. Sl. No. Category of Supply of Services Supplier of service Recipient of Service 14. Security services (services provided by way of supply of security personnel) provided to a registered person: Provided that nothing contained in this entry shall apply to, ? (i) (a) a Department or Establishment of the Central Government or State Government or Union territory; or (b) local authority; or (c) Governmental agencies; which has taken registration under the Central Goods and Services Tax Act, 2017 (12 of 2017) only for the purpose of deducting tax under section 51 of the said Act and not for making a taxable supply of goods or services; or (ii) a registered person paying tax under section 10 of the said Act. Any person other than a body corporate A registered person, located in the taxable territory.?;
2.I am in the business of saloon. And I purchased a car for carry the client from their place to saloon. And changed consideration for that also in the saloon bill with gst. So can I claim ITC on purchasing of this car. (Posted On: 24 Aug, 2020)

Ans. Section 17(5) of CGST Act deals with blocked credit. The relevant provision is as follows ?(a) motor vehicles for transportation of persons having approved seating capacity of not more than thirteen persons (including the driver), except when they are used for making the following taxable supplies, namely:? (A) further supply of such motor vehicles; or (B) transportation of passengers; or (C) imparting training on driving such motor vehicles;? Credit in relation to motor vehicles is allowed only in case of the above three cases. So the scenario mentioned by you in the query does not fall in any of the above three situations. So Credit shall not be available.
1.अगर हम कोई बिल बनाते है 1000 का और उस पर 18% gst लगा लेते है. बिल का टोटल हुआ 1180/-, फिर उसमें से 100₹ discount दे देते है. ये सही है ?? 2nd condition हमने साल में सेल की 1,00,000+18,000 = 1,18,000/-. बाद में turnover/Spl Discount के नाम पर 10,000+18% का credit Note issue कर दिया तो ये गलत है ? Please Guide करे. (Posted On: 24 Aug, 2020)

Ans. Supply के समय या उससे पहले ज्ञात discount को लेनदेन मूल्य से deudction की अनुमति दी जाएगी। पर इस तरह की छूट का स्पष्ट उल्लेख एग्रीमेंट में होना चाहिए। Supply के बाद दी जाने वाली discount केवल तभी दी जाएगी जब - 1. यह बिक्री और बिक्री से पहले दर्ज किए गए समझौते में उल्लिखित है 2. इनपुट टैक्स क्रेडिट अनुपात में छूट supply के recipient द्वारा reverse कर दी गई है; और 3. यह स्पष्ट रूप से invoice से मेल खाती हो। पहले मामले में 900/- रुपये पर tax लागू होगा अगर discount supply के समय या उससे पहले ज्ञात हो। दूसरे मामले में जहां टर्नओवर या विशेष छूट 10000/- है तो यह समझौते में writing में होनी चाहिए।
A Company has ISD registration for its Head Office in Tamilnadu. The company has two plants, one in Pondicherry and other in Tamilnadu. Company has obtained normal registration for both of its factories. Now if the company has to cross charge the service of its head office to its plants, will the company be required to obtain a regular registration for its Head Office? Further what are the services of Head Office (other than salary) to be considered for cross charge? Aashish jain (Posted On: 23 Aug, 2020)
In case of imported machine installation done by foreign party at our plant on that installation charges whether RCM is payable or not? Please guide on the above issue. (Posted On: 22 Aug, 2020)

The service being provided shall be Import of Services as per Section 2(11) of IGST Act 2017. So the installation services provided by foreign party is liable to tax under RCM basis and IGST shall be payable as it is inter state transaction. If the machine supplier has charged one price for installation charges along with value of goodsthen it is composite supply and IGST is paid on the same in Bill of Entry. Hence, then second time IGST should not be paid. But if these are separately charged then RCM will be payable.
बैंक में जो जीएसटी लग कर आता है तथा GSTR-2A में भी दिखता है तो क्या बैंक स्टेटमेंट के basis पर क्रेडिट ले सकते हैं? (Posted On: 22 Aug, 2020)

Ans. In order to avail credit the conditions mentioned in Section 16(2) needs to be satisfied which are as follows:- 1. Possession of Tax invoice; 2. Receipt of goods or services or both; 3. Returns are furnished as per section 39. 4. Tax charged has been actually paid to government either by cash or credit. If the above conditions are satisfied along with appearing in GSTR-2A (which is to be satisfied as per Rule 36(4)) then credit can be availed. Hence, receipt of GST invoice of this transaction is mandatory.
I am facing one issue in GST. in one of my clients whose GST returns were pending from May 2018. As per Govt circular that No charges will be levied for NIL return and maximum 500/- per return. but in my client still late payment fees is reflecting (Posted On: 22 Aug, 2020)

We are also facing the same issue. In case some of the client?s late fees is even exceeding the maximum cap of Rs. 500/- and reflecting the actual fees. This is a portal?s error. We suggest that a grievance be submitted on GST portal. We are also preparing one update on the same in our series titled ?GST and Johnny? and it will be published soon.
माल सप्लाई करने वाले ने माल खरीदने वाले को क्रेडिट नोट जारी किया है। परंतु माल खरीदने वाले ने जीएसटी रिटर्न फाइल करते हुए पूरा क्रेडिट ले लिया और क्रेडिट नोट का effect नहीं दिया। अगले महीने के रिटर्न भरते हुए माल खरीदने वाला इसका क्या treatment करें कि गलती सुधर जाए ? (Posted On: 22 Aug, 2020)

क्रेडिट नोट का प्रभाव return में दिया जाना आवश्यक है। यदि माल बेचने वाले द्वारा जारी किया गया क्रेडिट नोट वित्तीय वर्ष 2019-20 से संबंधित है तो क्रेडिट नोट का effect GSTR-3B के माध्यम से सितंबर 2020 तक ही किया जा सकता है। अन्यथा इसे DRC-03 के माध्यम से भुगतान किया जाना है। ब्याज का भुगतान दोनों मामलों में किया जाना है।
I have purchased a land for construction of building but due to COVID-19 we have dropped the idea of construction and have given to farmers for the purpose of Cultivation on percentage of profit basis. Is this liable to GST. (Posted On: 22 Aug, 2020)

This shall fall under Heading 9986 and not liable to GST. Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 deals with exemption on supply of exempt services. The relevant portion is as follows Sl. No.54,Chapter Heading 9986, Description of Services Rate (per cent.): Services relating to cultivation of plants and rearing of all life forms of animals, except the rearing of horses, for food, fibre, fuel, raw material or other similar products or agricultural produce by way of... (d) renting or leasing of agro machinery or vacant land with or without a structure incidental to its use. Rate(%)-NIL Condition:NIL
a) XYZ Pvt. Ltd. have unutilised balance in Excise PLA A/c from F Y 2014-15 onwards under Education Cess and SHEC. Post GST XYZ also applied for refund through ACES portal, but did not receive the refund. Whether this amount is required to be written off in the books of accounts? The statutory auditors want confirmation on the same. b) XYZ paid service tax under RCM as per Excise Audit of Apr-16 to June-17 with interest & penalty. This amount could not be claimed post GST introduction. Whether this amount to be written off in books of accounts or to keep under receivables? The statutory auditors want confirmation on the same. Please guide. Kaustubh Karandikar (Posted On: 21 Aug, 2020)
What is Invoice Reference Number (IRN)? (Posted On: 21 Aug, 2020)

The Invoice Reference Number (IRN) is a unique number (also known as hash) generated by the e-invoice system using a hash generation algorithm. For every document such as an invoice or debit or credit note to be submitted on the e-invoice system, a unique 64 characters Invoice Reference Number (IRN) shall be generated which is based on the computation of hash of GSTIN of supplier of document (invoice or credit note etc.), Year and Document type and Document number like invoice number. This shall be unique to each invoice and hence be the unique identity for each invoice for the entire financial year in the entire GST System for a taxpayer.
If any corporate address is changed but global Tech vendors keep sending invoices to old address (of course payments are made based on digital invoices) then we can?t claim those GST Credits. Vendor asking for some changes in applications which can?t be done due to WFH but Finance is creating unwarranted pressure. (Posted On: 21 Aug, 2020)

Amendment in Registration certificate is required to be done firstly. Then it is to be intimated to the vendors. If due to the COVID pandemic unable to do so then there shall be no issue in availing credit if these invoices are being reflected in you GSTR-2A. But intimation of the new address is required to be done later or sooner.
Any opinion on which year?s turnover is to be checked for applicability of E-Invoicing? Current Year (till September) or Previous Year? (Posted On: 21 Aug, 2020)

An FAQ published on einvoice1-trial.nic.in states that ?The e-invoice system will be implemented in phased manner. Government has issued the notification indicating that the registered businesses having aggregate turnover greater than Rs 500 crores for the financial year 2019-20 will be required to electronically transmit invoices to the Invoice Registration Portal (IRP) from 1st October, 2020.? This indicates that the turnover for the previous year is to be considered.
Need to apply for GST Refund for 18-19 period. In 3B, reported supply under regular instead of export. Now while filing rfd01, refund amount is automatically calculated as Zero and unable to proceed. Please suggest solution. (Posted On: 21 Aug, 2020)

For this, you have to pay again in GSTR-3B under correct column that is Zero rated supplies and then apply refund of the same saying excess tax paid under the Refund application ?Others?. For ease of understanding you can refer to Case Study of ?M/s Swarup International? published on our website www.capradeepjain.com where similar issue is reported.
Dept has raised query that consent letter has to on Notarised Paper. Is it required? (Posted On: 21 Aug, 2020)

There is no such provision in law which require for the consent letters to be notarised.
Sir, Whether 50% Credit of Capital Goods not availed in the financial year it was received will lapsed as per the Rule 4(2)(a) of CCR, 2004 or 100% credit is available in the subsequent years. Ramkesh (Posted On: 21 Aug, 2020)
5. A question on GST: A training institution obtains food from vendors who charge GST. This food is provided to trainees (Lunch, Tea). The course fees includes cost of this food. Can ITC be availed on food? A) If course fee specifically states that its inclusive on meals. B) if not states that meals are included. (Posted On: 20 Aug, 2020)

Ans. Section 17(5)(b) pertaining to blocked credits reads as follows ?(i) food and beverages, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, leasing, renting or hiring of motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa) except when used for the purposes specified therein, life insurance and health insurance: Provided that the input tax credit in respect of such goods or services or both shall be available where an inward supply of such goods or services or both is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply;? If the food supplied to trainees are being provided either as composite or mixed supply then credit shall be available. Hence, the credit in current situation will be available.
4. Winning car race and subsequently motivational prize/awards given by unconnected persons to winner, how to be dealt in GST? (Posted On: 20 Aug, 2020)

Ans. Winning of prizes does not attract GST as it is not to be considered as supply.
3. Has anyone reversed service tax credit claimed by builder for providing construction services which was taxable during service tax regime but became exempt under GST due to receipt of completion certificate? (Posted On: 20 Aug, 2020)

Ans. No, there is no provision in law for reversal of service tax credit. This credit is neither to be forwarded nor to be reversed.
2. One of my client has built a factory and paid some of amount of GST on material. Can I take ITC of it? (Posted On: 20 Aug, 2020)

Ans. Credit shall not be available as Section 17(5)(d) of CGST Act 2017 restricts the same. This provision reads as follows ?(d) goods or services or both received by a taxable person for construction of an immovable property (other than plant or machinery) on his own account including when such goods or services or both are used in the course or furtherance of business.?
We are selling a second hand car which was purchased in VAT period. We have sold the same in June 2020. Whether the GST is to be paid on complete amount or on the margin only? Futher, the abatement will be available on the same. Whether benefit of both notifications will be available to us? Eloborate with an example. (Posted On: 20 Aug, 2020)

Ans. This query is in reference to our Query No. 3 posted on 19th Aug 2020 as ?GST QUERIES #93/2020-21? regarding sale of used Motor Vehicle. We have received a lot of comments on this query and we are very thankful to our vigilant readers for the feedback of the same. We had mistakenly written that the abatement is @65%. We intend to apologize our vigilant readers for the inconvenience caused due to typo- graphical error. We really appreciate our readers for putting up the concern so that it could be rectified. So, in this note we intend to discuss the applicability of tax on sale of used Vehicle. We shall be discussing two important notifications issued with respect to sale of used vehicles. ? Notification No. 37/2017 ? Central Tax (Rate) dated 13.10.2017 It has been issued to provide for tax at 65% of central tax applicable on motor vehicles falling in tariff heading 87 under Notification No. 1/2017-Central Tax (Rate) dated, 28th June, 2017. The benefit under the above notification is admissible if the following conditions are satisfied:- 1. The supplier of Motor Vehicle is a registered person. 2. Such supplier had purchased the Motor Vehicle prior to 1st July, 2017 and has not availed input tax credit of central excise duty, Value Added Tax or any other taxes paid on such vehicles Also, the sunset clause of this notification has been kept as 1st July, 2020. In view of above discussion, it is clear that the benefit of paying tax only on 65% shall be available. ? Notification No. 8/2018 ? Central Tax (Rate) dated 25.01.2018 This notification intends to exempt and reduce the rate specified in notification No. 1/2017-Central Tax (Rate) applicable on the sale of used vehicles. We are presenting the rates period wise and vehicle wise below in a tabular form for ease of reference Category of vehicle (Based on notification no.01/2017 & 08/2018) ? CT (R) GST rate up to 25/01/2018 GST rate from 25/01/2018 Petrol Vehicles with more than 1200cc engine capacity & 4000mm length (HSN 8703) 28% 18% Diesel Vehicles with more than 1500cc engine capacity & 4000mm length (HSN 8703) 28% 18% SUVs (including utility vehicles) with more than 1500cc engine capacity (HSN 8703) 28% 18% Vehicles other than those mentioned above, including other vehicles under chapter 87 28%/18%/12%* 12% For the purposes of obtaining the benefit under this notification, the above two conditions specified in 37/2017-Central Tax (Rate) need to be satisfied. Explanation given in this notification determines the taxable value which shall be difference between the consideration received for supply of such goods and depreciated value of goods on the date of supply. If it is positive then it is to be taxed at the rates specified above in the table. If it is Negative then no tax is payable. Now, the moot question that arises here is whether the abatement of 35% shall also continue along with the benefit of margin scheme. Notification 37/2017 is issued under section 9(1) of the Act which explains levy and collection of CGST on intra state supplies. Notification number 8/2018 is issued under Section 11 of CGST Act, 2017 provides power to government for granting exemption from CGST on intra state supplies. Thus, accordingly, both the notifications are issued under different sections of the Act i.e. section 9 which prescribes tariff rates while section 11 grants exemption. Thus, both are not exemption notification. Therefore, benefits of both the notification can be availed. Now, we will explain the above query with the help of an example, Mr. X purchased a vehicle on 01.04.2012 that is pre-GST regime for Rs. 6,00,000/-. He wants to sell his vehicle for Rs. 1,20,000/-. And the WDV on date of supply is Rs. 1,00,000/-. Let us analyse the amount of tax considering two different dates for the supply of Vehicle a. Calculation of tax if supplied on 30th June 2020 Sale price = Rs. 1,20,000/- WDV as on 30.06.2020 = Rs. 1,00,000/- Margin as on 30.06.2020= Rs. 20,000/- Abatement @ 35% = Rs. 7000/- Taxable amount =Rs. 13000/- If the tax rate applicable on this car is 18%, the tax amount shall be derived as = 13,000*18/100 = 2,340/-
Whether a person supplying goods or services through E commerce operator would be entitled to threshold exemption? (Posted On: 19 Aug, 2020)

No. Section 24(ix) of CGST Act lays down that the threshold exemption is not available to such persons and they would be liable to be registered irrespective of the value of supply made by them. This requirement is, however, applicable only if the supply is made through such e commerce operator who is required to collect tax at source under section 52 of CGST Act. However, where E commerce operators are liable to pay tax on behalf of the suppliers under notification issued under section 9(5), the suppliers of such services are entitled for threshold exemption.
How to download document wise details of Table 8A of Form GSTR-9? (Posted On: 19 Aug, 2020)

. Table 8A of the form is downloadable in Excel format as a Zip file for FY 2018-19. To Download, the following steps are to be followed Services > Returns > Annual Return > Form GSTR-9 (PREPARE ONLINE) > DOWNLOAD TABLE 8A DOCUMENT DETAILS option.
MEIS लाइसेंस सप्लाई हुआ तो यह GST से exempt है. परंतु उसी महीने में अगर कोई MEIS लाइसेंस किसी consultant से बनवाया और उसने बिल में GST चार्ज किया है तो उसकी क्रेडिट पूरी reverse होगी क्योंकि यह exempted सप्लाई में काम आई है। परंतु अगर उसी माह में MEIS की कोई सप्लाई नहीं है तो क्या होगा? (Posted On: 19 Aug, 2020)

अगर MEIS की सप्लाई नहीं है तथा खुद के इनपुट के import पर लगने वाली custom ड्यूटी में use किया है तो क्रेडिट ले सकते है। ऐसा इसलिए है क्योंकि MEIS is used in furtherance of business. परंतु अगर MEIS license को किसी और को ट्रांसफर किया है तो उसकी सप्लाई exempt है। ऐसी स्थिति में इस बिल पर क्रेडिट नहीं ले सकते हैं क्योंकि यह बिल exclusively exempted सप्लाई में use हुआ है।
Due to oversight one of my client has put invoice number around 24 characters. Now while filling GSTR-1, the invoice number column restricts to maximum 16 characters. Can anyone suggest how to now fill invoice number detail in respective GSTR-1 Column?? The client invoice number is in this way: 019/ABCD/EFGH/IJK/20-21 (Posted On: 19 Aug, 2020)

If this is a Tax invoice for supply in domestic market then you need to amend the invoice as Rule 46 (b) clearly reads as ?a consecutive serial number not exceeding sixteen characters, in one or multiple series, containing alphabets or numerals or special characters hyphen or dash and slash symbolised as ―-‖ and ―/‖ respectively, and any combination thereof, unique for a financial year?. And if you have issued an invoice for supply under Export and in the Shipping bill the 24 characters invoice no. is mentioned, then this shall create a problem in sanctioning of refund.
XYZ(India) will be exporting the goods to PQR (U.K.). Before export, PQR wants XYZ to store the goods in India for about 2 months and then on their instructions export the same. The price charged for the supply of goods will be inclusive of storage charges. 1) Is XYZ liable to pay GST on the storage charges recovered which is built up in the price of the goods? 2) If the storage charges are recovered separately with a service invoice is XYZ liable to pay GST on it? Kaustubh Karandikar (Posted On: 19 Aug, 2020)
A company has purchased the car prior to GST regime. The company has not availed Cenvat credit or Vat credit on the same. Now the company wants to sell the car. What should be the taxable value for the sale of car. Should the taxable value be WDV of the car as per Income Tax Act or WDV as per books of Accounts? Also enlighten what should be the GST rate on the sale of car? Is the notification no. 37/2017 relevant here or should we refer to only notification 8/2018? Aashish jain (Posted On: 18 Aug, 2020)

First come to the question of applicability of rate of GST on sale of car, Notification No. 8/2018 ? Central Tax (Rate) shall be applicable. We shall summarize the applicability of GST Rate in the following tabular manner :- Category of vehicle (Based on notification no.01/2017 & 08/2018) ? CT (R) GST rate up to 25/01/2018 GST rate from 25/01/2018 (with conditions) Petrol Vehicles with more than 1200cc engine capacity & 4000mm length (HSN 8703) 28% 18% Diesel Vehicles with more than 1500cc engine capacity & 4000mm length (HSN 8703) 28% 18% SUVs (including utility vehicles) with more than 1500cc engine capacity (HSN 8703) 28% 18% Vehicles other than those mentioned above, including other vehicles under chapter 87 28%/18%/12%* 12% The conditions which need to be satisfied are that the vehicle is to be purchased prior to GST Regime and CENVAT or VAT credit shall not be availed which are being very well satisfied as the situation given in Query. As already answered in our earlier query, the tax will be payable under margin scheme. Now moving forward to next question- whether the WDV as per income tax Act or WDV as per books of accounts is to be considered? This has been answered in the Notification no. 8/2018 itself. The relevant portion is being reproduced below for your reference. ?Explanation ?For the purposes of this notification, - (i) in case of a registered person who has claimed depreciation under section 32 of the Income-Tax Act,1961(43 of 1961) on the said goods, the value that represents the margin of the supplier shall be the difference between the consideration received for supply of such goods and the depreciated value of such goods on the date of supply, and where the margin of such supply is negative, it shall be ignored; and? This explanation makes it clear that WDV as per Income tax Act is to be considered. Further abatement @35% will be available if it is purchased before GST regime and sold before 31.07.2020 as per notification number 37/3017-Central Tax(Rate) dated 13.10.2017.
XYZ is a Commercial Cooperative Society (registered with GST). They receive security services from ?Maharashtra Security Guard Board (not registered with GST). As per the PAN issued to them, they are registered with Income Tax department as ?Local Authority?. Whether XYZ is required to pay GST under reverse charge on the services supplied by the security board? Kaustubh Karandikar (Posted On: 18 Aug, 2020)
Please confirm what is rate of GST on cross charge invoice from HO to Branch & what is the HSN/SAC code to be mention on Invoice. (Posted On: 18 Aug, 2020)

The rate and HSN code shall depend on the type of services being rendered. Suppose if Audit services are provided then the SAC code and rate applicable to audit services shall be applied.
XYZ (Registered with GST) is receiving an equipment from PQR (Registered with GST) for drilling holes in the equipment. XYZ is carrying the said work and sending back the equipment. XYZ is required to charge 12% GST or 18% for such drilling of holes activity? (Posted On: 18 Aug, 2020)

As per Notification No. 20/2019 - Central Tax (Rate) dated 30.09.2019, if any service provided by way of treatment or processing undertaken by a person on goods belonging to another registered person will be considered under the Job work service and liable @ 12%. So, XYZ is required to charge 12%.
Can one update the vehicle and transporter details and extend the validity of e-way bills, if required, for the e-way bills belonging to the blocked GSTINs? (Posted On: 18 Aug, 2020)

The transporters/ tax payers can update the vehicle and transporter details and carry out the extension in validity period of these e-way bills, if required.
We have a firm which is active and E way bill is unblocked but while generating the E way bill it says Invalid GST number. What can be done now? (Posted On: 18 Aug, 2020)

As per FAQ?s given on E Way bill site if the returns on the portal are filed then select the option <"Search  Update Block Status" and then enter his/her GSTIN and see the status. If the GSTIN is still shown as blocked, then they can use update option to get the latest filing status from the GST Common Portal. If return filing default period is less than two, the return filing status will be communicated by GST System to E Way Bill Portal, and such blocked taxpayers GSTIN will be unblocked and E Way Bill generation facility will be restored on EWB Portal. Taxpayers may contact the GST helpdesk and raise a grievance, if issue is not resolved.Other way round is that if it shows invalid GSTIN then this indicates that GSTIN entered by you is wrong or your GSTIN details is not available in the GST Common Portal. Please check the GSTIN entered or go to the GST portal (www.gst.gov.in) and check the details of your GSTIN under ?Search Taxpayer? tab.
I want to know is there anyway to find whether any party has opted under composite scheme or not? (Posted On: 18 Aug, 2020)

On GST Portal www.gst.gov.in there is an option of ?Search taxpayer? where on giving the required details say GSTIN it gives the details of registered person. Wherein one of the detail given is of ?Taxpayer Type? which specifies that the registered person is ?Regular? or ?Under Composition?.
Who needs to file Form GSTR-4 (Annual Return)? (Posted On: 14 Aug, 2020)

All registered taxpayers who have opted for composition scheme under GST, for any period during the financial year, need to file Form GSTR-4 (Annual Return). This will include a taxpayer ? ? who have opted for composition scheme since registration and have never opted out subsequently; and ? who have opted in for composition scheme before starting of the financial year; and ? who have opted in for composition but subsequently opted out any time during the year.
An unregistered service provider (commission on sales) whose turnover is less than Rs. 20 lakhs is based in Delhi. He is providing services (commission on sales) to a GST registered dealer in Rajasthan. Commission on sales is not covered under reverse charge mechanism. Please let me know: Whether service provider required to be registered under GST or not? If registration is not required than how GST registered dealer will pay GST under RCM? (Posted On: 14 Aug, 2020)

A person making inter-state supply of services is not required to register under GST if his aggregate turnover is less than Rs 20/10 lakhs. Notification No. 10/2017-IT dated 13-10-17). The agent is not required to get registration under GST if turnover is below 20 lacs. Since the service provider is not liable to take registration, then he will not charge any GST and the recipient is not required to make tax payment under reverse charge mechanism.
Kindly find out if e invoice is mandatory for RP whose turnover crosses 500 cr after September this year? (Posted On: 14 Aug, 2020)

Notification No. 61/2020?Central Tax Dated 30th July, 2020 states that E-invoice under GST is applicable for Assessee?s having turnover in a financial year above Rs. 500 crore with effect from October 1, 2020 and SEZ units are excluded from e-invoicing. Vide Notification No. 60/2020 Central Tax dated 30 July, 2020; the CBIC has notified the updated version of e-invoice format.
Sir 17/18 GST audit case where some of the credit note appear in 2A, it needs reversal or making suitable notes in the audit report is sufficient? (Posted On: 14 Aug, 2020)

As per the new rule 36(4) inserted vide Notification No. 49/2019 dated 09th October 2019, a taxpayer can claim provisional Input Tax Credit (ITC) only to the extent of 20% of the eligible credit available, in respect of invoices or debit notes, the details of which have been uploaded by its suppliers. Though the government had reduced this capping of 20% by 10% via notification 75/2019 dated 26th December 2019 which was effective from 1/1/2020. There was no such rule prevailing during the financial year 2017-18 and hence, there is no requirement to reverse the credit note appearing in GSTR 2A. A suitable note in the audit report is sufficient and invoice availability with the taxpayer should be verified.
Whether job worker could add materials in addition to the goods sent by principal for treatment or process? (Posted On: 14 Aug, 2020)

The Central Government vide circular no. 34/8/2018-GST dated 1st March 2018, adopts the principles laid down by the judicial precedents. It was also clarified in the circular no. 38/12/2018 as under: Further, it is clarified that the job worker, in addition to the goods received from the principal, can use his own goods for providing the services of job work.
XYZ is a commercial Cooperative Society. The land of the society is on lease and therefore, charges needs to be paid to the District Collector against such leased land which is subsequently recovered from the members at actuals. Similarly, Municipal Tax paid to the corporation is recovered from the members at actuals. 1) Whether XYZ is required to pay GST on such amount recovered? 2) If no, whether proportionate Input Tax Credit (ITC) is required to be reversed since it is an exempted supply? Kaustubh Karandikar (Posted On: 14 Aug, 2020)
XYZ (Registered with GST) is receiving an equipment from PQR (Registered with GST) for drilling holes in the equipment. XYZ is carrying the said work and sending back the equipment. XYZ is required to charge 12% GST or 18% for such drilling of holes activity? Kaustubh Karandikar (Posted On: 13 Aug, 2020)
In case of a Private Limited Company, while filing GST Returns pertaining to financial year 2019 ? 2020 ? some of the invoices raised on registered entities were missed. Is there any remedy for this mistake? Kindly advise me. (Posted On: 13 Aug, 2020)

Sir you can amend the said invoices in GSTR 1 from B2C to B2B or if missed to be uploaded, then it can be uploaded till the due date of filing September 2020 GSTR 1 return.
मेरा एक क्लाइंट है उसका टेक्सटाइल का काम है, उसकी GST inverted duty structure का 2019-20 का रिफंड लगाना है, अगर अभी जो सिस्टम चल रहा है, उसके हिसाब से उसको सिर्फ input का ही रिफंड मिलेगा तो उसका अमाउंट बहुत ही कम मिलता है। अगर गुजरात हाई कोर्ट के निर्णय के अनुसार input service का refund भी साथ में लगाते हैं तो यह काफी बढ़ जाता है। आपके हिसाब से हमें क्या करना चाहिए? (Posted On: 13 Aug, 2020)

The High Court of Gujarat in the case of VKC Footsteps India Private Limited vs Union of India has struck down the portion of explanation (a) to Rule 89(5) of the CGST Rules to the extent of restricting the claim of refund of Input Tax Credit availed on Input Services under inverted duty structure. This decision has paved the way for another much needed reform in the GST Regime under the refunds segment. The taxpayers can file GST inverted duty structure considering input services and should be ready to face the litigation. At this juncture, an amendment is eagerly awaited to reduce the strain on the judicial system by preventing the queuing up of petitions before the High Courts and save their invaluable time.
Sir, Whether RCM is applicable on pollution fee paid to State Pollution control Board. (Posted On: 13 Aug, 2020)

Services supplied by the Central Government, State Government, Union territory or local authority to a business entity is covered under RCM under entry no. 5 of Notification No.13/2017-Central Tax(Rate) dated 28.06.2017. The Rajasthan State Pollution Control Board is a body corporate constituted under section 4 of the Water (Prevention and Control of Pollution) Act, 1974. It was first constituted on 7th February 1975, with the objectives of prevention, and control of water pollution and maintaining or restoring of wholesomeness of water. The definition of ?local authority? is very specific and means only those bodies which are mentioned as ?local authorities? in clause (69) of section 2 of the CGST Act, 2017. It would not include other bodies which are merely described as a ?local body? by virtue of a local law. Pollution control board is constituted by State Government and doesn?t fall within the definition of local authority. It can be categorised as governmental authority or entity. Hence, RCM is not applicable on the said transaction.
I want to amend taxpayer category to SEZ from normal one. Can anyone please suggest? (Posted On: 13 Aug, 2020)

Sir, you are required to amend the registration on the GST portal.
In Year 2018-19 we just had input credit of Rs.12000 for purchase of mobile phone for partner in Feb'19 and no other sale and purchase. I had not taken the same into consideration and had filed both GSTR-3B and GSTR-1 as nil return. However it was reflecting in GSTR-2A in Feb'19. In April'19 (year 2019-20) I took that ITC in GSTR-3B. My query is now that I have to file Annual GSTR-9 for 2018-19, whether I should include ITC of Rs.12000 in Annual Return GSTR-9 of year 2018-19 or 2019-20? (Posted On: 13 Aug, 2020)

If you have recorded the invoice pertaining to mobile phone in your books of accounts in the financial year 2018-19, and then it will be considered in annual return in the said financial year in Table 13 and 12C of GSTR 9C. However, if recorded in 2019-20, then it will be reflected in table 6 of the GSTR 9 and table 12A of GSTR 9C.
XYZ is a commercial Cooperative Society. Can they claim ITC on the insurance premium paid on the society building? Kaustubh Karandikar (Posted On: 13 Aug, 2020)
XYZ is a commercial Cooperative Society. Society is investing the excess fund in fixed deposit and in mutual funds and receiving the interest/dividend. Are they required to pay GST on it. If no, are they required to reduce ITC to the extent of this exempt income? Kaustubh Karandikar (Posted On: 13 Aug, 2020)
XYZ is a commercial Cooperative Society .one of the Consulates is members of this society and having their office in their building. Society is not charging GST as the consulates are exempted from GST. Do XYZ need to reduce ITC to the extent of the exempt income? Kaustubh Karandikar (Posted On: 13 Aug, 2020)
XYZ is a commercial Cooperative Society & has one electricity connection and hence one bill from BEST for the whole building. Individual members having sub meters only to assess their reading. Every month society is taking the actual reading from members sub meter for actual consumption of the electricity. Based on the same, electricity charges are recovered from the members. Is XYZ liable to pay GST on the electricity charges recovered from members even though it is only a reimbursement? Kaustubh Karandikar (Posted On: 12 Aug, 2020)
we are a small scale Merchant Exporters buying goods like food stuffs, soft drinks from Mfrs or Distributors of Mfrs and exporting them.While buying the same from them on Intra State or Interstate basis, for some of the goods,a cess is also charged apart from CGST&SGST OR IGST.. Is this Cess also refundable after exports like GST? and If so under which relevant Notification ? Manish Shah (Posted On: 12 Aug, 2020)
How is availed input credit treated when one switch on to Composition Scheme from the normal scheme? (Posted On: 11 Aug, 2020)

In such a case when a person switches on to composition scheme from normal scheme, he/ she becomes accountable to pay an amount equal to the credit of input tax in terms of inputs present in stock on the day instantly after the date of the switchover. The remaining balance of input tax credit in the credit ledger after payment of such amount will lapse.
Whether interest income is to be included in aggregate turnover while looking for the registration limit? (Posted On: 11 Aug, 2020)

Yes interest income is to be considered while looking into the limit for GST registration. Since the services are exempted from payment of GST and one is not required to discharge GST on the activity of providing services by way of extending deposits, loans or advances where the consideration is represented by way of interest. And the definition of Aggregate turnover says that ?means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess;? Even in recent Advance Ruling Judgment in case of Shree Swami Manhoor lal Rathi [Advance Ruling No. GUJ/GAAR/R/2020/10, Dated: 19th May, 2020] wherein it was held that PPF interest should also be included in aggregate turnover. We have prepared an update no. 72/2020-21 on the same which can be viewed on following link http://new.capradeepjain.com/amdview/gst-update-on-whether-interest-income-is-a-part-of-12423
What is your opinion on commission charged by foreign banks which is recovered by Indian bank from exporter, with respect to RCM liability on Indian exporter? (Posted On: 11 Aug, 2020)

In order to pay tax under Reverse charge mechanism, the transaction should have taken place between the exporter and the foreign bank. In the scenario discussed in the query, commission has been charged by the foreign bank on Indian bank which does not involve the exporter. So, exporter is not liable to pay tax under Reverse charge basis. We have successfully pleaded this case in Gujarat during service tax era.
What is the tax rate applicable to interior decorator services. Whether it is 18 or 12(18_6(itc pass on)) (Posted On: 11 Aug, 2020)

Rate of 18% shall be applicable on interior decorator services and credit can be availed. The SAC code of which is 9983.
What will be the Place of Supply (POS) in respect of the Authorised Service Station of Vehicle Repairs/Service...? The Service Station is charging the GST based on the State where the Vehicle is registered. (It is charging IGST, for the vehicle registered in other State.). But, I am of the view that the POS should be the State where the Service Station is established, i.e, where the Service is actually provided. Whether I am correct? (Posted On: 11 Aug, 2020)

As per Section 12 of IGST Act pertaining to ?Place of supply of services where location of supplier and recipient is in India? the place of supply of services made to a registered person shall be the location of such person. In the Act the performance based services are given in Section 13 of Act which deals with ?Place of supply of services where location of supplier or location of recipient is outside India?. In the instant case, Section 12 will be applicable. Hence, the service station is correct in charging IGST if the location of recipient is in the other state. The place of supply will not be decided on the basis of performance based criteria.
(Posted On: 11 Aug, 2020)
A professional training institute gets its training material printed from a printing press. The content of the material is provided by the training institute who owns the usage rights of the same while the physical inputs including paper used for printing belong to the printer. Wether supply of training material by the printing press constitutes supply of goods or supply of services. (Posted On: 11 Aug, 2020)

Circular No. 11/11/2017 GST dated 20.10.2017 has clarified that supply of books printed with contents supplied by the recipient of such printed goods, is composite supply and the question, whether such supplies constitute supply of goods or services would be determined on the basis of what constitutes the principal supply. Principal supply has been defined in section 2(90) of the CGST Act as supply of goods or services which constitutes the predominant element of a composite supply and to which any other supply forming part of that composite supply is ancillary. In the case of printing of books where content is supplied by the publisher or the person who owns the usage rights to the intangible inputs while the physical inputs including paper used for printing belong to the printer, supply of printing [of the content supplied by the recipient of supply] is the principal supply and therefore, such supplies would constitute supply of service
Whether input services capitalised will be capital goods and liable for reversal u/r 43? (Posted On: 11 Aug, 2020)

Yes as Rule 43 of CGST rules deals with Manner of determination of input tax credit in respect of capital goods and reversal thereof in certain cases.
I have made a supply of exempted goods in the month of June 2020 and shown this in GSTR-1. In the month of August 2020 I have issued credit note. Is this to be shown in GSTR ? 1. Please suggest. (Posted On: 11 Aug, 2020)

Yes sir the credit note issued against supply of exempted goods is to be reduced in table ?8A,8B,8C,8D ? Nil rated supplies? in GSTR-1. Yes, it is to be shown in GSTR-1.
Sales made to the party named suppose M/s Goyal traders and GSTR-1 filed but sales to be made to M/s Goyal traders who has different GSTN. How to correct this issue? Problem occurred in several months of FY 19 -20 and the m/s Goyal traders asking that he is not getting ITC coz sales made to Goyal traders not m/s Goyal traders. What is the solution? (Posted On: 11 Aug, 2020)

The facility of amendment is provided on portal. In order to rectify this mistake GSTIN of the party M/s Goyal trader is to be corrected in GSTR-1 through the table 9A ?amended B2B Invoices?. Then the opposite party shall also be eligible to take credit as it shall reflect in their GSTR-2A in the amended B2B invoices table in the month in which amendment is made by you.
Landowners have done developement agreement with builder to make the land Non Agriculture and get layout and plan sanctioned.All expenses by builder. In return for this work he will get 40% of the plots developed.No building construction. Is GST applicable.There is no RERA registration. Anand Gulanikar (Posted On: 09 Aug, 2020)
If Duty Credit scrips are sold, the person selling the same is required to issue Bill of Supply and is also required to proportionately reverse the ITC claimed. Is it correct sir? Kaustubh Karandikar (Posted On: 08 Aug, 2020)

From October 13, 2017 vide notification no. 35/2017 ? central tax (Rate), the entry of duty credit scrips has been inserted to notification no. 2/2017-Central tax (Rate) which describes the list of exempted goods. A person supplying exempted goods is required to issue bill of supply. Further as per Section 17(2) pertaining to ?Apportionment of credit? reads as ?(2) Where the goods or services or both are used by the registered person partly for effecting taxable supplies including zero-rated supplies under this Act or under the Integrated Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts, the amount of credit shall be restricted to so much of the input tax as is attributable to the said taxable supplies including zero-rated supplies.? So, your understanding of proportionate reversal of ITC is correct.
What will happen if the TDS entry is rejected by the deductee? (Posted On: 08 Aug, 2020)

TDS credit entries rejected by the deductee will be auto-populated into Table 4 of Form GSTR-7 and the relevant details will be required to be amended by the deductor in Form GSTR-7 of next tax period. Post correction of such details in Form GSTR-7, the data will automatically flow to concern GSTIN (supplier) for accepting or rejecting it. This process will be repeated until TDS details are accepted by counter-party.
If sale price is less than its cost, would it have any impact under GST? (Posted On: 08 Aug, 2020)

In terms of section 15 if transaction value is the sole consideration and the parties are not related, then it could be any value irrespective of below or above cost price. Supreme Court in case of Fiat India ruled selling less than its cost with an intention to penetrate the market would be the case of price not being the sole consideration and held transaction value in such case has to be disregarded. The applicable of this decision needs to be looked at on a case to case basis and cannot be binding in all scenarios.
I have imported capital goods against EPCG license and it was found that the machinery is defective. As a result, we want to export the said machinery for the purpose of repair and maintenance. What is the obligations required to be performed and whether we are required to pay customs duty again on re import? (Posted On: 08 Aug, 2020)

Notification No. 16/2015-Customs dated 01.04.2015 states that Where the goods specified are found defective or unfit for use, the said goods may be re-exported back to the foreign supplier within three years from date of clearance of said goods. Provided that at the time of re-export, the goods are identified to the satisfaction of the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be, to be the same as the goods which were imported.
Is it mandatory to file Nil ITC 04 for a particular period? (Posted On: 08 Aug, 2020)

ITC-04 is to provide details of job work supplies. If you do not have any job work supplies then you need not to file ITC-04. ITC-04 is not mandatory and is required only if there is any supply for job work or goods are received back from job worker premises. The portal gives the permission to file ITC 04 for next quarter even if previous one is not filed.
Is it possible to transfer balance in electronic cash ledger to another registration under same PAN? (Posted On: 08 Aug, 2020)

Transfer of credit from one electronic cash ledger of a GSTIN to another GSTIN is not permissible under GST Law. Recently intra transfer from one head to other with the same GSTIN is permitted via PMT 09.
Should excess ITC availed be added to output liability in GSTR 9 in table 9? (Posted On: 07 Aug, 2020)

The appropriate presentation of showing Excess ITC availed is making it a part of unreconciled ITC in Table 12F of GSTR 9C. This excess ITC availed should be paid in cash along with interest in DRC-03.
4. Good morning Sir, regarding 2A vs 3B mismatch, in earlier situation, it was required that tax on such purchase should be paid. Now point is, whether appearing in 2A is must or evidence showing tax has been paid is sufficient for this type of mismatch? (Posted On: 07 Aug, 2020)

As per Section 16(2) of the CGST Act,2017- Notwithstanding anything contained in this section, no registered person shall be entitled to the credit of any input tax in respect of any supply of goods or services or both to him unless, ?? (a) he is in possession of a tax invoice or debit note issued by a supplier registered under this Act, or such other tax paying documents as may be prescribed; (b) he has received the goods or services or both. However, Rule 36(4) of the CGST Rules,2017 specifies that credit can be availed by the taxpayer if it is reflected in his GSTR 2A. This rule has been relaxed for the period February 2020 to August 2020 and cumulative adjustment of the said period as per rule 36(4) is to be done while filing return for the month of September 2020. Experts are of the view that section can?t be overriding any rule prescribed in the law. If you have proper tax document, then you are entitled for credit availment. However, department will raise litigation under the shield of Rule 36(4).
Please advise the due date of ITC-04 for the period of April-20 to June-20, any notifications for extension. (Posted On: 07 Aug, 2020)

Notification number 55/2020 was issued on 27th June 2020 replacing the dates in the earlier notification number 35/2020 dated 3rd April 2020. With the new notification, most of the GST procedural compliance that would become due between 20th March 2020 and 30th August 2020, except for the filing of CMP-08, GSTR-4, GSTR-3B and GSTR-1, annual returns, shall stand extended up to 31st August 2020. Therefore, the last date of filing ITC 04 for the period April to June 2020 is 31st August 2020.
एक व्यापारी अपना बिज़नेस(MSME) नाम बदलने के लिए एप्लीकेशन दिया। आज डिपार्टमेंट ने नोटिस दिया कि अपने बिज़नेस नाम का कोई प्रूफ दीजिये। अब इसमें कौन सा प्रूफ दिया जाएगा? (Posted On: 07 Aug, 2020)

You can submit Udyog Aadhar to the department for proof of business name. Udyog Aadhaar is a twelve-digit Unique Identification Number provided by the Ministry of Micro, Small and Medium Enterprises, Government of India for small and medium enterprises. Udyog Aadhaar Memorandum (UAM) is a process under which you can get your industry registered by filling the only one-page form, which has been run by the MSME Department of India. Udyog Aadhaar online registration is free.
My company is registered in GST and listed on BSE and NSE. We have paid Annual Custody charges to NSDL for compliance of listing requirements. Whether we are eligible to avail such credit on charges? (Posted On: 07 Aug, 2020)

As per Section 2(52) of the CGST Act, 2017, ?goods? means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply. Since the shares and securities are out of GST purview, hence the credit is ineligible. However, some authors are of the view that this credit is in course of furtherance of business, hence the credit should be availed. This is disputed credit and if the amount involved is not significant, then we should avoid taking it.
My company is registered in GST and listed on BSE and NSE. We have paid Annual Custody charges to NSDL for compliance of listing requirements. Whether we are eligible to avail such credit on charges? (Posted On: 07 Aug, 2020)

Answer- As per Section 2(52) of the CGST Act, 2017, ?goods? means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply. Since the shares and securities are out of GST purview, hence the credit is ineligible. However, some authors are of the view that this credit is in course of furtherance of business, hence the credit should be availed. This is disputed credit and if the amount involved is not significant, then we should avoid taking it.
we have sale meis licence (as a exempted) supply. need to reversal ITC under rule 42? bhavin kalaria (Posted On: 07 Aug, 2020)
I am sending my goods for job work to an unregistered job worker and want to directly supply the gods from job worker premises. Can I do so? (Posted On: 06 Aug, 2020)

Yes, you can make supply directly from job workers premises. But as per the provisions of the Act you need to add the unregistered job worker?s premises as additional place of business. The relevant excerpt of proviso to section 143(1)(b) is produced for quick reference ?Provided that the principal shall not supply the goods from the place of business of a job worker in accordance with the provisions of this clause unless the said principal declares the place of business of the job worker as his additional place of business except in a case? (i) where the job worker is registered under section 25; or (ii) where the principal is engaged in the supply of such goods as may be notified by the Commissioner.?
Proprietor Died, ITC Transfer to new Firm on his Wife Name by ITC02. Whether Wife should be added as authorised signatory in old Firm? (Posted On: 06 Aug, 2020)

Yes, she needs to be added as authorised signatory in old firm for completion of the formalities like transfer of credit through ITC-02, surrendering the registration and filing the Final Return. She can be added as authorised signatory by writing letter to the department.
Can Consolidated credit notes be issued? (Posted On: 06 Aug, 2020)

The concept of consolidated credit notes shall be applicable from 1st October 2020, notification yet needs to be issued. As per sources, council has scrapped the idea of introducing the New returns so have planned to introduce changes to the existing returns of GSTR-1 and 3B.
One of my friends is proprietor & is not registered under GST. He doesn't own any vehicle & takes the same on rent from market as per requirement. The vehicle owner charges his rent & my friend issues LR to his customer as GTA. Further, he provides transportation service to parties of different states also. The same party requires Invoice also. So, he is issuing invoice by showing his charges & declaring the same on Invoice that GST is to be paid under RCM to the parties of other states. Whether everything is correct in this Interstate transaction? Is there necessity of his registration? (Posted On: 06 Aug, 2020)

Notification No. 5/2017 central tax dated 19.06.2017 exempts the persons from obtaining registration who make supplies on which tax is to be paid by recipient under reverse charge basis. The relevant portion is stated here for your reference. ?hereby specifies the persons who are only engaged in making supplies of taxable goods or services or both, the total tax on which is liable to be paid on reverse charge basis by the recipient of such goods or services or both under sub-section (3) of section 9 of the said Act as the category of persons exempted from obtaining registration under the aforesaid Act.? Irrespective of providing inter state supply, there is no need to obtain registration by GTA.
180 days provision is applicable on goods or services or both? (Posted On: 06 Aug, 2020)

Yes, it is applicable to goods or services or both as the second proviso to section 16(2)(d) reads as follows ?Provided further that where a recipient fails to pay to the supplier of goods or services or both, other than the supplies on which tax is payable on reverse charge basis, the amount towards the value of supply along with tax payable thereon within a period of one hundred and eighty days from the date of issue of invoice by the supplier, an amount equal to the input tax credit availed by the recipient shall be added to his output tax liability, along with interest thereon, in such manner as may be prescribed?
A Government Contractor provide various Services to Government ie Works Contract Service, Pure Labour Service, Services to DM Judge SDM House(on which payment is given by PWD Government Department). He paid approx 60% amount as wages to labour. Whether Is there any Exemptions or all amount received by him are taxable @ 12%??? He doesn't want to pay Tax on full as he said that 60% is paid to labour itself? (Posted On: 05 Aug, 2020)

There is no other way but the total amount is to be billed at 12%. GST is payable on gross amount and not on net income.
I have received a security deposit against dyes and tools on the condition that it shall be refunded if the minimum say 10 lakh tonnes material order should be givenotherwise it shall be forfeited. Is GST applicable on security deposit? (Posted On: 05 Aug, 2020)

Proviso to section 2(31) which states the definition of consideration reads as follows ?Provided that a deposit given in respect of the supply of goods or services or both shall not be considered as payment made for such supply unless the supplier applies such deposit as consideration for the said supply;?Thus if the deposit is refundable then GST is not applicable but as and when it is forfeited then GST is to be charged. Since in the given case, it is conditional if the amount is forfeited then GST shall be charged at the time of forfeiture. If the same is refunded then there is no need to pay GST on deposit.
Can a company claim GST input credit of GST levied by bank on annual membership fees of corporate credit card. (Posted On: 05 Aug, 2020)

GST Credit on annual membership fees of corporate credit card can be availed if it is used in furtherance of business as stated in section 17(1) which is given here for your quick reference ?(1) Where the goods or services or both are used by the registered person partly for the purpose of any business and partly for other purposes, the amount of credit shall be restricted to so much of the input tax as is attributable to the purposes of his business.
Is GST Payable on sale of machinery. (Posted On: 05 Aug, 2020)

Section 18(6) reads as follows ?(6) In case of supply of capital goods or plant and machinery, on which input tax credit has been taken, the registered person shall pay an amount equal to the input tax credit taken on the said capital goods or plant and machinery reduced by such percentage points as may be prescribed or the tax on the transaction value of such capital goods or plant and machinery determined under section 15, whichever is higher? Thus GST is applicable on sale of Plant & machinery.
Is GST exemption available on transportation of books through goods carriage? (Posted On: 04 Aug, 2020)

Exemption from RCM is available only when the value of transportation consignment charged by GTA is below Rs. 750/-. No exemption is available in the present case stated by you.
The supplier opting for composition levy need not maintain certain records. What are those records? (Posted On: 04 Aug, 2020)

As per rule 56(2) and 56(4) of the CGST Rules, 2017, the supplier opting for composition levy need not maintain the following records: (i) Accounts of stock in respect of goods received and supplied by him, and such accounts shall contain particulars of the opening balance, receipt, supply, goods lost, stolen, destroyed, written off or disposed of by way of gift or free sample and the balance of stock including raw materials, finished goods, scrap and wastage thereof. (ii) Account, containing the details of tax payable (including tax payable under reverse charge), tax collected and paid, input tax, input tax credit claimed, together with a register of tax invoice, credit notes, debit notes, delivery challan issued or received during any tax period.
Can ITC be not be reversed in GSTR 3B with payment of interest through DRC03. (Posted On: 04 Aug, 2020)

This query is in continuation to Query no. 3 of GST Queries 83/2020-21 earlier answered. One of our active reader has asked this query. For this we would like to say that if the credit relates to earlier period of 2017-18, 2018-19, then reversal is to be done through DRC-03 only be it reversal or payment of tax thereon. As any adjustments relating to a year can be done till September of the next year or filing of annual return whichever is earlier. If we do after that date then it will be very difficult to show in annual returns also. Moreover, the payment in DRC-03 of GST amount can be done through credit amount but interest payment is to be done in cash only.
I have purchased goods and have taken credit in GSTR-3B. But it is not getting reflected in GSTR-2A. Will I have to pay tax as I have claimed ITC in GSTR-3B. (Posted On: 04 Aug, 2020)

As per the recently amended Rule 36(4) vide notification No. 75/2019-Central Tax dated 26.12.2019 which was inserted vide notification no. 49/2019-Central Tax dated 09.10.2019, upto 10% credit can be availed on and above those reflecting in GSTR-2A. If it falls under this 10% then you need not pay tax. But if it belongs to earlier period then as per Section 16(2) of CGST Act the credit is not allowed if supplier has not paid it. The department will recover it from you. However, it has been contended by many consultants that payment of tax is combined responsibility of both Supplier as well as of receiver. But firstly, it should be recovered from the supplier. If he fails to pay the same then it can recovered from receiver.
I have Surrendered GST registration. And now I want to take the same registration again. Is it possible? (Posted On: 04 Aug, 2020)

No it is not possible to obtain the same registration again after surrendering it. You have to apply for a new registration.
XYZ is a proprietory concern. The said concern they want to convert it to Private Limited firm. The present proprietor will remain as one of the directors and few more directors might get added in the new private limited firm. 1) What are the formalities to be observed by XYZ for complying with the GST provisions while carrying out the above conversion? Kaustubh Karandikar (Posted On: 04 Aug, 2020)
We receive bulk raw material through rake and truck also. GRN is made on the basis of lower of weighment quantity and RR/Challan quantity which ever is less. But we need to pay to the supplier on the basis of Challan quantity. Whether we should reduce GST credit if GRN quantity is less. But we are paying for the full quantity. Susanta Rath (Posted On: 03 Aug, 2020)
Capital Goods(on which cenvat charged and paid) received After apointed day under GST Act,for which credit not availed under Excise Act, as the material received after apointed day.Now how to claim the cenvat for it? LALITH KUMAR SARMA (Posted On: 03 Aug, 2020)
XYZ (India) is a 100% service exporter to its overseas parent company and has two major activities. 1) marketing and promotion of the parent company products in India; and 2) customer support centre (call centre) for the parent companies? customers/prospects all over the world. The parent company has a cost-plus service arrangement with the parent. Is it an export of service and therefore no GST? Kaustubh Karandikar (Posted On: 02 Aug, 2020)
Sir,Automoblle Cess is eligible for transitional credit under section 140 of GST Act,2017 and person is a engaged in trading of two-wheeler. Yogendra Kumar Garg (Posted On: 02 Aug, 2020)

Any cess shall not be available as per the retrospective amendment made effective from 01.07.2017 vide CGST Amendment Act 2018. Explanation 3 has been inserted to section 140 of CGST Act 2017which reads as follows ?Explanation 3.?For removal of doubts, it is hereby clarified that the expression ?eligible duties and taxes? excludes any cess which has not been specified in Explanation 1 or Explanation 2 and any cess which is collected as additional duty of customs under sub-section (1) of section 3 of the Customs Tariff Act, 1975.?. So, Automobile cess is not eligible to be claimed for transitional credit.
garg_ykg@rediffmail.com Yogendra Kumar Garg (Posted On: 02 Aug, 2020)
Sir, we are paying the GST @ 18% on reimbursement of expenses of repair and maintenance of building giving for residential purpose. What SAC Code we have to mention on such invoice. Preeti Singh (Posted On: 02 Aug, 2020)
In continuation of the above query, is there any provision that the penalty being levied be waived? (Posted On: 01 Aug, 2020)

As mentioned in the query DRC-07 has been issued under Section 73 of the Act, this section pertains to ?Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised for any reason other than fraud or any wilful misstatement or suppression of facts.? Sub section 8 of this section reads as?(8) Where any person chargeable with tax under sub-section (1) or sub-section (3) pays the said tax along with interest payable under section 50 within thirty days of issue of show cause notice, no penalty shall be payableand all proceedings in respect of the said notice shall be deemed to be concluded.? So if the tax amount is paid within 30 days from the issue of Show cause notice, then waiver from penalty can be availed.
Search was conducted in our factory premises and it was found that stock was excess factually when compared to in books. Tax and penalty are being paid under section 73 of the act though DRC-07. Can credit of the same be availed. (Posted On: 01 Aug, 2020)

Credit of tax paid through DRC-07 under section 73 canbe availed,as the provisions of Section 17(5) of CGST Act which deals with blocked credit only restricts input of tax paid under sections 74, 129 and 130. However, query does not specifically tell about person (factory or its buyer) availing the credit.
Excess ITC has been claimed in the year 2018-19, can this ITC be reversed in the month of March 2020 through GSTR-3B or it has to be paid through DRC-03? (Posted On: 01 Aug, 2020)

This is to be paid through DRC-03. As DRC-03 is the form used for showing the voluntary payments or payments done against the Show Cause Notice (SCN) issued by the department or in adherence to section 142(2) and 142(3) of CGST Rules 2017.
Client is into selling medicinal oil which is taxable. He himself carrying out activity of growing of medicinal plants at rented farms and use it as a raw material in captive consumption. Query is whether ITC on activities carried out at agriculture farm (say use of fertiliser, pesticides, farm labour manpower supply, shed, irrigation piping, loading, storage and transportation) be available. (Posted On: 01 Aug, 2020)

In our opinion credit can be availed as the final output is taxable. As per the provisions of Section 17(2) of CGST Act 2017, ?Where the goods or services or both are used by the registered person partly for effecting taxable supplies including zero-rated supplies under this Act or under the Integrated Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts, the amount of credit shall be restricted to so much of the input tax as is attributable to the said taxable supplies including zero-rated supplies.? Since the final output is taxable and the seed from which oil is being extracted is only an intermediary product credit shall be available as there is no such provision in GST regime.
Pls clear my doubt, Can assessee claim the ITC on charges given to company for car leasing services? For eg bank is taking car leasing services for its mangers from a company....Can bank claim the itc of this service? (Posted On: 01 Aug, 2020)

Section 17(5) dealing with blocked credits has been amended by CGST Amendment Act 2018, the relevant excerpt reads as follows ?food and beverages, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, leasing, renting or hiring of motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa) except when used for the purposes specified therein, life insurance and health insurance: ??. ??. Provided that the input tax credit in respect of such goods or services or both shall be available, where it is obligatory for an employer to provide the same to its employees under any law for the time being in force? So if it is obligatory under any law for availing such services to employees then credit can be availed otherwise not.
Mr. A, a registered person was paying tax under Composition Scheme up to 30th July. However, w.e.f. 31st July, Mr. A becomes liable to pay tax under regular scheme. Is he eligible for ITC? (Posted On: 01 Aug, 2020)

Mr. A, a registered person was paying tax under Composition Scheme up to 30th July. However, w.e.f. 31st July, Mr. A is not eligible to take credit during his operation under composition scheme but after that he will be eligible to take credit as he is operating as a normal taxpayer.
What are the safeguards provided to a person who is placed under arrest? (Posted On: 01 Aug, 2020)

Section 69 of CGST Act, 2017 provides following safeguards to a person who is placed under arrest: (a) If a person is arrested for a cognizable offence, he must be informed of the grounds of arrest and be produced before a magistrate within 24 hours. (b) If a person is arrested for a non-cognizable offence, he shall be admitted to bail or in default of bail, forwarded to the custody of the Magistrate. (c) All arrest must be in accordance with the provisions of the Code of Criminal Procedure relating to arrest in terms of section 69(3) of CGST Act, 2017.
In order to incur a reduced export obligation under the EPCG scheme, we propose to pay IGST on imports of capital goods? Is it allowed? (Posted On: 01 Aug, 2020)

Yes, provided you do not take input tax credit of the IGST paid. As per Para 5.01(d) of the FTP, ?in case Integrated Tax and Compensation Cess are paid in cash on imports under EPCG, incidence of the said Integrated Tax and Compensation Cess would not be taken for computation of net duty saved provided Input Tax Credit is not availed?.
Under the SEIS Scheme, Is the duty credit scrip issued on the basis of a Chartered Accountant certificate? Do the authorities put it through any other checks? (Posted On: 01 Aug, 2020)

The authorities may check the application to examine whether prima facie, the services exported are eligible for the benefits, and for any other obvious errors in the application and the Chartered Accountant Certificate. Besides, as per Para 3.19 of the FTP and Para 3.17of the HBP, 10 per cent of the scrips issued every month will be selected for scrutiny. The authorities can call for the original physical documents for examination in detail. If they find any discrepancies or deficiencies, the applicant will be asked to rectify them. In case of excess availment of rewards, the applicant will be asked to refund the excess claim with interest, in accordance with Para 3.19 of the FTP.
I am a transporter and have obtained registrations in two different states. Can I opt for two different options in different states like in one state under Forward charge and in the other state under Reverse Charge Mechanism. (Posted On: 01 Aug, 2020)

Yes sir you can opt different options in different states though considered as distinct persons. However, as mentioned in our earlier query, a person cannot opt for both the options in one state.
What is the procedure for amendment of registration under CGST Act and rules thereto? (Posted On: 31 Jul, 2020)

The procedure for amendment of registration are contained in section 28 read with rule 19 of CGST Rules. The significant aspects of the same are discussed hereunder: 1. Where there is any change in the particulars furnished in registration application/UIN application at the time of obtaining the registration or thereafter, registered person shall submit an application in prescribed manner, within 15 days of such change, along with documents relating to such change at the Common Portal. 2. In case of amendment of core fields of information, the proper officer may, on the basis of information furnished or as ascertained by him, approve or reject amendments in the registration particulars in the prescribed manner. Such amendment shall take effect from the date of occurrence of event warranting such amendment. 3 However, where change relates to non-core fields of information, registration certificate shall stand amended upon submission of the application for amendment on the Common Portal. 4 Where a change in the constitution of any business results in change of PAN of a registered person, the said person shall apply for fresh registration. The reason for the same is that GSTIN is PAN based. Any change in PAN would warrant a new registration.
I sell some exempted as well as taxable goods. Is it mandatorily required to issue two separate GST documents while supplying to school students? (Posted On: 31 Jul, 2020)

As per rule 46A of the CGST Rules, 2017, where a registered person is supplying taxable as well as exempted goods or services or both to an unregistered person, a single ?invoice-cum-bill of supply? may be issued for all such supplies. Thus, there is no need to issue a tax invoice and a bill of supply separately to the school student in respect of supply of the taxable and exempted goods respectively.
Advance payment is received against supply of services, but subsequently no supplies are made. What are the required documents which are to be issued? (Posted On: 31 Jul, 2020)

As per section 31(3)(e) of CGST Act, 2017, where advance payment is received against a supply for which receipt voucher has been issued, but subsequently no supplies are made and no tax invoice is issued in pursuance thereof, a refund voucher has to be issued to the person who had made the advance payment.
Which supplies are notified as deemed exports? (Posted On: 31 Jul, 2020)

The following supplies have been notified as deemed exports under section 147 of the CGST Act, 2017: 1. Supply of goods by a registered person against Advance Authorisation. 2. Supply of capital goods by a registered person against Export Promotion Capital Goods Authorisation. 3. Supply of goods by a registered person to Export Oriented Unit. 4. Supply of gold by a notified bank/Public Sector Undertaking against Advance Authorisation.
Whether a CGST/SGST authority can revise an order passed by his subordinates? (Posted On: 31 Jul, 2020)

Section 2(99) of the CGST Act, 2017 defines ?Revisional Authority? as an authority appointed or authorized under the CGST Act for revision of decision or orders as referred to in section 108 of the CGST Act, 2017. Section 108 of the CGST Act, 2017 authorizes such ?Revisional Authority? to call for and examine any order passed by his subordinates and in case he considers the order of the lower authority to be erroneous in so far as it is prejudicial to revenue and is illegal or improper or has not taken into account certain material facts, whether available at the time of issuance of the said order or not or in consequence of an observation by the Comptroller and Auditor General of India, he may, if necessary, can revise the order after giving opportunity of being heard to the noticee. The ?revisional authority? can also stay the operation of any order passed by his subordinates pending such revision. The ?revisional authority? shall not revise any order if- (a) the order has been subject to an appeal under section 107 or under section 112 or under section 117 or under section 118; or (b) the period specified under section 107(2) has not yet expired or more than three years have expired after the passing of the decision or order sought to be revised. (c) the order has already been taken up for revision under this section at any earlier stage. (d) the order is a revisional order.
A person carrying passenger transportation services (air conditioned) as stage carrier(from one place to another place). Now as per my opinion, he has the option of 5% rate without ITC or 12% with ITC since in both the entries in N. No.11/2017-CT(R)the condition of changes include fuel cost also. Request your opinion please. CA. C V SURYAM (Posted On: 31 Jul, 2020)
A Government Contractor provide various Services to Government ie Works Contract Service, Pure Labour Service, Services to DM Judge SDM House(on which payment is given by PWD Government Department) He paid approx 60% amount as wages to labour Whether Is there any Exemptions or all amount received by him are taxable @ 12%??? He doesn't want to pay Tax on full as he said that 60% is paid to labour itself Jatin Aggarwaal (Posted On: 30 Jul, 2020)
Hello there CAREDOGBEST_ - Personalized Dog Harness. All sizes from XS to XXL. Easy ON/OFF in just 2 seconds. LIFETIME WARRANTY. Click here: caredogbest.online Best Wishes, - capradeepjain.com Clarice (Posted On: 30 Jul, 2020)
A person is chargeable with tax in case of fraud. He decides to pay the amount of demand along with interest before issue of notice. Is there any immunity available to such person? (Posted On: 29 Jul, 2020)

Yes. Person chargeable with tax, shall have an option to pay the amount of tax along with interest and penalty equal to 15% per cent of the tax involved, as ascertained either on his own or ascertained by the proper officer, and on such payment, no notice shall be issued with respect to the tax so paid [Section 74(6)].
Securities (mutual fund and others) tax liable under GST or exempted. please advise in details (Posted On: 29 Jul, 2020)

Securities have been kept out of purview of GST as per the Definition of ?goods? in section 2(52) of CGST Act 2017 as ?every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply;? But for the purposes of proportionate reversal it has been included in section 17(3) pertaining to Apportionment of credit which states that ?The value of exempt supply under sub-section (2) shall be such as may be prescribed, and shall include supplies on which the recipient is liable to pay tax on reverse charge basis, transactions in securities, sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building.?
If electrical fitting attached on the wall can credit be claimed? (Posted On: 29 Jul, 2020)

Sub section (d) of Section 17(5) pertaining to blocked credit reads as ?goods or services or both received by a taxable person for construction of an immovable property (other than plant or machinery) on his own account including when such goods or services or both are used in the course or furtherance of business.? So if electrical fittings are being fitted into the wall they shall be considered part of immovable property and credit shall not be available. Even the recent AAR ruling has opined on same lines.
What's the last date of TDS return for quarter 1 of FY 2020-21? (Posted On: 29 Jul, 2020)

As per notification No. 55/2020-Central Tax dated 27.06.2020, the due dates for furnishing of return falling between the period 20.03.2020 to 30.08.2020 shall be extended to 31.08.2020.
One of my client is transporter and registered in GST. He is issuing both type of bill with GST and without GST. can he do so? (Posted On: 29 Jul, 2020)

Transporter cannot issue both types of bills, one with GST and one without GST. He can opt for one of these two options:- a. Does not charge anything but is paid by the service recipient @5% on reverse charge basis. b. Charge 12% with ITC.
What is the time limit for passing adjudication order. (Posted On: 28 Jul, 2020)

As per section 74(10) of CGST Act, 2017, ?the proper officer shall issue the adjudication order within 5 years from the due date for furnishing of Annual Return for the financial year to which the tax not paid/short paid/input tax credit wrongly availed/utilised relates to or within 5 years from the date of erroneous refund.?
ABC Manufacturers Ltd. engages Raghav & Sons as an agent to sell goods on its behalf. Raghav & Sons sells goods to Swami Associates on behalf of ABC Manufacturers Ltd. Who shall be liable to pay GST on such goods. (Posted On: 28 Jul, 2020)

Where an agent supplies or receives any taxable goods on behalf of his principal, such agent and his principal shall, jointly and severally, be liable to pay the tax payable on such goods under this Act. Thus, in the given case, ABC Manufacturers Ltd. and Raghav & Sons shall, jointly and severally, be liable to pay GST payable on such goods.
If I am sending back goods after job work then i am writing my invoice value of job charges in e-way bill. Should I write value of goods after job work? Then in that case my invoice value will not match with e-way bill. Department may seize it. Should I return material on job work Challan? Then send invoice separately (Posted On: 28 Jul, 2020)

In case of sending the goods back after Job work, these can be sent on the basis of Challan, as the E way bill site provides for only options in Document type column ? ?Challan? and ?others?. So it is better to send the goods back on basis of challan and writing on the challan that the goods are being sent back after Job work. The value of the goods needs to be mentioned in E way bill but not the value of service provided. Invoice can be raised in a period of 30 days as job work charges are counted as ?service?.
If I changed B2B invoice in GSTR-1 by amendment of May'19 in June'20 GSTR-01, will the change will be reflected in May'19 also or not? If require to send screenshot then where to find changed invoice? (Posted On: 28 Jul, 2020)

The amendment will be reflected in the month of June 2020 in ?B2B amended? table itself but not in the month of May 2019.
How to change B2B invoice to B2C invoice? (Posted On: 28 Jul, 2020)

The B2B invoice can be amended by incorporating all the values as Zero and the adding details to B2C table in next month.
In case of death of a person liable to pay tax, interest or penalty, who shall be liable to pay said dues? (Posted On: 27 Jul, 2020)

On death of a person liable to pay tax, interest or penalty [Section 93(1)]: Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016, where a person, liable to pay tax, interest or penalty under CGST Act, dies, then:  business is continued after his death: if a business carried on by the person is continued after his death by his legal representative or any other person, such legal representative or other person, shall be liable to pay tax, interest or penalty due from such person under this Act. [It is also clarified that the transferee/ successor shall be liable to pay any tax, interest or any penalty due from the transferor in cases of transfer of business due to death of sole proprietor - [Circular No. 96/15/2019 GST dated 28.03.2019]  business is discontinued after his death: if the business carried on by the person is discontinued, whether before or after his death, his legal representative shall be liable to pay, out of the estate of the deceased, to the extent to which the estate is capable of meeting the charge, the tax, interest or penalty due from such person under this Act, whether such tax, interest or penalty has been determined before his death but has remained unpaid or is determined after his death.
I have obtained ISD registration in the state of Gujarat and have offices in Rajasthan as well as Uttar Pradesh. On what basis is credit to be distributed? (Posted On: 27 Jul, 2020)

The relevant Rule which talks about the distribution of credit by ISD is produced here Rule 39(1)(d) of CGST Rules 2017 ? ?the input tax credit that is required to be distributed in accordance with the provisions of clause (d) and (e) of sub-section (2) of section 20 to one of the recipients ?R1?, whether registered or not, from amongst the total of all the recipients to whom input tax credit is attributable, including the recipient(s) who are engaged in making exempt supply, or are otherwise not registered for any reason, shall be the amount, ―C1‖, to be calculated by applying the following formula - C1 = (t1?T) ? C where, ?C? is the amount of credit to be distributed, ?t1? is the turnover, as referred to in section 20, of person R1 during the relevant period, and ?T? is the aggregate of the turnover, during the relevant period, of all recipients to whom the input service is attributable in accordance with the provisions of section 20? So the credit is to be distributed on the basis of the turnover. Even the GST paid on supply to distinct person is to be included. Although the supply from factory to branch office is not considered as ?sale? in Balance Sheet yet these supplies will be considered as ?supply? for the purpose of distribution of input tax credit by ISD.
What will happen if buyer take ITC on second hand goods and pay GST on taxable value? GST charged on Margin Value only not on Full price so very nominal ITC can be availed on Purchase (Posted On: 27 Jul, 2020)

Rule 32(5) clearly indicates that ITC cannot be taken if the taxpayer has opted for margin scheme be it nominal credit. The provision has been highlighted here for quick reference. ?(5) Where a taxable supply is provided by a person dealing in buying and selling of second hand goods i.e., used goods as such or after such minor processing which does not change the nature of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and where the value of such supply is negative, it shall be ignored?
Sir, Invoice given to customer as Value. ₹5100 GST ₹90 (18%on ₹500) Total ₹5190. Now in Fin Year 2018-19. Taxable Value in GSTR3B taken ₹5100 and Tax amount is ₹90 (Taxable Value in GSTR3B is ₹1.15 Crores, But Actually It should be ₹51 Lakhs as per Margin Scheme). This Inflate Taxable Value approx ₹60Lakh and also Income Tax Audit Filled with Sales Value as shown in 3B i.e. ₹1.15 Crore. Still GSTR1 & GSTR9 is pending. What to do Now? (Posted On: 27 Jul, 2020)

Sir, GSTR-1 needs to be filed correctly even though in GSTR-3B is being wrongly inflated. So in GSTR-1, the value should be shown as Rs. 500 under 18 % rate. In GSTR-9, there would be no difference in tax amount paid but the difference shall arise on account of taxable turnover in GSTR-9C (there shall be no difference in GSTR-1 and GSTR -9 as the figures of GSTR-1 be auto populated in GSTR-9). We can show the difference in table 5O (any other adjustment) of GSTR-9C.
Sir I am a director of a company, I receive remuneration on which TDS is deductible u/s 192 of Income Tax Act, Rent on which RCM is being paid by Company (in order to avoid litigation in future) and commission. For the purposes of calculation of Turnover under GST which incomes are to be considered. (Posted On: 27 Jul, 2020)

Section 2(6) of CGST Act defines aggregate turnover as ?(6) ?aggregate turnover? means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess? So as per the facts given in the query, for calculating turnover, income from rent and Commission is to be considered.
Mr. X, an unregistered person under GST purchases the goods supplied by Mr. Y who is a registered person without receiving a tax invoice from Mr. Y and thus helps in tax evasion by Mr. Y. What disciplinary action may be taken by tax authorities to curb such type of cases and on whom? (Posted On: 25 Jul, 2020)

Both Mr. X and Mr. Y will be offender and will be liable to penalty as under: a. Mr. X ? Penalty under section 122(3) which may extend to Rs. 25,000/-; b. Mr. Y ? Penalty under section 122(1), which will be higher of following, namely (i) Rs. 10,000/- or (ii) 100% of tax evaded.
Managing director is issued a summon to appear before the central tax officer to produce the books of accounts of the company in an inquiry conducted on said company. Determine the amount of penalty, if any, that may be imposed if he fails to appear before the central tax officer. (Posted On: 25 Jul, 2020)

Section 122(3)(d) of the CGST Act, 2017 stipulates that any person who fails to appear before the officer of central tax, when issued with a summon for appearance to give evidence or produce a document in an inquiry is liable to a penalty which may extend to Rs. 25,000. Therefore, penalty uptoRs. 25,000 can be imposed in the given case.
Whether action can be taken for transportation of goods without valid documents or if goods are attempted to be removed without proper record in books? If yes, explain the related provisions under the CGST Act, 2017. (Posted On: 25 Jul, 2020)

Yes, action can be taken for transportation of goods without valid documents or if goods are attempted to be removed without proper record in books. If any person transports any goods or stores any such goods while in transit without the documents prescribed under the Act (i.e. invoice and a declaration) or supplies or stores any goods that have not been recorded in the books or accounts maintained by him, then such goods shall be liable for detention along with any vehicle on which they are being transported [Section 129 of CGST Act].
Is it compulsory that an EOU has to export its goods under LUT only and not under payment of IGST? Can't they use their accumulated ITC for payment of IGST on export-goods and get the refund thereof from Customs through system. (Posted On: 25 Jul, 2020)

There is no clarity on the same. If an EOU supplies in domestic market, then he has to pay IGST and reverse the benefit of BCD availed on inputs used in manufacture of these export goods. When we export on payment of IGST then is there requirement to reverse BCD? If these are not exported then this amount will be payable by EOU. This is ambiguity on which no clarification is issued.
A client having Mobile Shop dealing in new and second hand mobile They purchase second hand mobile in bulk quantity from a company and get proper invoice(reflected in GSTR2A) He is not availing any ITC on Second Hand Mobile purchase Now As per Margin Scheme he issued invoices for Second Hand Mobile by charging GST on margin value only Eg Mobile ₹5100 Tax 18% ₹90 (say he earns ₹500) Total 5190 In GSTR3B what is Taxable Value ₹5100 or ₹500??? Jatin Aggarwaal (Posted On: 24 Jul, 2020)

Rule 32 of CGST Rule 2017 deals with ?Determination of value in respect of certain supplies?. Sub rule 5 of the said rule reads as follows ?Where a taxable supply is provided by a person dealing in buying and selling of second hand goods i.e., used goods as such or after such minor processing which does not change the nature of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and where the value of such supply is negative, it shall be ignored? So in GSTR-3B the difference between purchase price and selling price is to be considered. Rs. 500/- as taken in the example is to be shown in GSTR-3B.
Where an offence under the GST law is committed by a taxable person being a trust, who are deemed to be guilty of the offence and under what circumstances? When do the relevant provisions become inapplicable in respect of individuals concerned with the trust? (Posted On: 24 Jul, 2020)

Section 137 of the CGST Act, 2017 stipulates that where an offence under the GST law is committed by a taxable person being a trust, the managing trustee shall be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. Further, where it is proved that the offence committed by the trust has been committed ? ? with the consent or connivance of, or ? is attributable to any negligence on the part of any other individual concerned with the trust, he shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. The relevant provisions will become inapplicable in respect of individuals concerned with the trust, if they prove that the offence was committed without their knowledge or that they had exercised all due diligence to prevent the commission of such offence.
What is the current gst rate of gst on mobile phones....is there any notification for increased rate of 18% or existing rate of 12% in force? (Posted On: 24 Jul, 2020)

As per Notification No. 03/2020-Central Tax (Rate) dated 25.03.2020, the rate on mobile phones has been increased to 18% from 12%. This is being made effective from 01.04.2020.
Where Principal Manufacturer (PM) is located in say Maharashtra and Job-worker (JW) in Karnataka, can the PM treat the same similar to Stock transfer from one state to another and raise a Tax invoice on JW for each batch of goods sent? If not, what is GST document to be raised for transfer of goods by PM to the JW? Can anyone kindly clarify the above query? (Posted On: 24 Jul, 2020)

Rule 45 of CGST Rules 2017 contains the conditions and restrictions in respect to inputs and capital goods sent to the job worker ?(1)The inputs, semi-finished goods or capital goods shall be sent to the job worker under the cover of a challan issued by the principal, including where such goods are sent directly to a job-worker, [and where the goods are sent from one job worker to another job worker, the challan may be issued either by the principal or the job worker sending the goods to another job worker: Provided that the challan issued by the principal may be endorsed by the job worker, indicating therein the quantity and description of goods where the goods are sent by one job worker to another or are returned to the principal: Provided further that the challan endorsed by the job worker may be further endorsed by another job worker, indicating therein the quantity and description of goods where the goods are sent by one job worker to another or are returned to the principal.]70 (2) The challan issued by the principal to the job worker shall contain the details specified in rule 55.? So in the present case the principal manufacturer need not issue tax invoice on Job worker but can send the goods on the basis of challan.
I have a query, Sales - 2.05 cr, Credit note - 8 lakh. Net sales - 1.97 cr which is less than 2 cr So GST audit is not applicable right? (Posted On: 24 Jul, 2020)

. Rule 80 of CGST Rules 2017 reads as follows ?Every registered person whose aggregate turnover during a financial year exceeds two crore rupees shall get his accounts audited as specified under sub-section (5) of section 35 and he shall furnish a copy of audited annual accounts and a reconciliation statement, duly certified, in FORM GSTR-9C, electronically through the common portal either directly or through a Facilitation Centre notified by the Commissioner.? Section 2(6) of CGST Act reads as ?aggregate turnover? means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess;The turnover is considered on the net sales. So as per the Query, GST Audit shall not be applicable as the aggregate turnover is to be considered as Rs. 1.97Cr. We would like to bring attention that the turnover limit for Financial year 2018-19 has been increased to Rs. 5 Cr by way of inserting a proviso to Rule 80 (3).
The job worker has not sent the inputs/capital goods to the principal within the time limits prescribed? What is the impact? (Posted On: 24 Jul, 2020)

The job work inputs should be returned within one year from date of despatch. The time limit is three years in case of capital goods. The principal is liable to pay the tax on goods not returned. He would be able to raise an invoice on which job worker would be eligible for credit. Although, the time of supply would be the date of sending the goods to the job worker, for which interest would be required to be paid for delay in tax payments. Practically, unless job worker makes payment against invoice to the principal, he would not be eligible for credit u/s 16 of CGST Act. Therefore, we suggest to job worker to make payments of this supply to principal and claim the credit. However other implication of this transaction on financial statements has to be studied.
A casual trader takes registration in different states in India and sales his goods through exhibition and sometimes only exhibits the goods. He takes ITC on services availed by him. For example, exhibition is in Delhi and he takes services and claim ITC on the services bills which was in the name of Rajasthan state and he claimed ITC in return of rajasthan. My question is whether ITC claimed in Rajasthan state allowed to him or not? Please note he exhibits in all states of India and claimed ITC in Rajasthan only. (Posted On: 23 Jul, 2020)

A casual taxable person (other than those making supply of specified handicraft goods) making taxable supply in India has to compulsorily take registration. A casual taxable person has to apply for registration at least five days prior to the commencement of business at any other place other than registered place. The casual taxable person can make taxable supplies only after the issuance of the certificate of registration. Circular No. 71/45/2018-GST dated 26.10.2018 clarified that the amount of advance tax which a casual taxable person is required to deposit while obtaining registration should be calculated after considering the due eligible ITC which might be available to such taxable person. As per Section 16 of the CGST Act, it is necessary that the goods and services should be received by the taxable person. The bill should be received in the name of the state wherein the service has been consumed. The advance tax payment should be made after reducing the eligible ITC pertaining to that state. You should not avail the whole credit in Rajasthan since it is not pertaining to Rajasthan state.
Sir RCM on cumin (Agriculture produce) is applicable or not? (Posted On: 23 Jul, 2020)

Notification No. 4/2017-Central Tax (Rate) dated 28.06.2017 specifies the supply of goods on which tax is to be paid under Reverse charge mechanism. This notification does not mention applicability of RCM on cumins. So tax under RCM is not applicable on it.
I purchase raw materials for 'TOTO', a battery operated three-wheeler and assemble it for final supply of goods ('TOTO'). Does this come under 'Manufacture'? Can I get refund on account of inverted duty structure? SANDIPAN CHANDA (Posted On: 22 Jul, 2020)

The term ?Manufacture? is being defined as per Section 2(72) of CGST Act 2017 as ??manufacture? means processing of raw material or inputs in any manner that results in emergence of a new product having a distinct name, character and use and the term ?manufacturer? shall be construed accordingly;? As per the case mentioned in the query, in our opinion, since inputs and the final product both are different then it shall be termed as manufacture and refund can be claimed on account of inverted duty structure. Moreover, the rate of tax on inputs should be higher than that of discharged on output product for claiming refund under such structure.
Is an advocate providing interstate supply chargeable under Reverse Charge liable for registration? (Posted On: 22 Jul, 2020)

Exemption from registration has been provided to such suppliers who are making only those supplies on which recipient is liable to discharge GST under RCM.
My job worker has high accumulated ITC balance on purchase of capital goods, rent expenses, etc. How do I, as the principal optimize tax cost here? (Posted On: 22 Jul, 2020)

In such cases, cost benefit analysis could be performed to verify whether the activity could be converted into a sale and purchase transaction where he would be able to avail credit on the purchases and pass on the ITC along with margin on job work services.
Who can be said to be as risky exporter? (Posted On: 22 Jul, 2020)

An exporter is tagged as risky if the customs department suspects that duty drawback claims and IGST refunds are claimed on the basis of bogus invoices. The consignments of risky exporters undergo manual checking before their claims are refunded.
Whether an appeal could be filed before the Appellate Authority against order of Authority for Advance Ruling (AAR), with reference to sections 100 and 101 of the CGST Act, 2017. (Posted On: 22 Jul, 2020)

Yes, the concerned officer, jurisdictional officer or applicant aggrieved by any advance ruling may appeal to the Appellate Authority for Advance Ruling (AAAR) within 30 days [extendible by another 30 days] from the date on which such ruling is communicated to him in the prescribed form and manner. The AAAR must pass an order confirming or modifying the ruling appealed against within a period of 90 days of the filing of an appeal, after hearing the parties to the appeal. If members of AAAR differ on any point referred to in appeal, it shall be deemed that no advance ruling can be issued in respect of the question under appeal. A copy of the advance ruling pronounced by the AAAR is sent to applicant, concerned officer, jurisdictional officer and to the Authority.
What are the duties to be performed by Anti Profiteering Authority? (Posted On: 22 Jul, 2020)

The duties of the Anti-profiteering Authority are: (i) to determine whether the reduction in tax rate or the benefit of input tax credit has been passed on by the seller to the buyer (hereinafter collectively referred to as ?benefit?) by reducing the prices (ii) to identify the taxpayer who has not passed on the benefit (iii) to order (a) reduction in prices (b) return to the recipient, an amount equivalent to the amount not passed on by way of commensurate reduction in prices along with interest at the rate of 18% from the date of collection of the higher amount till the date of the return of such amount or recovery of the amount not returned, as the case may be. If the eligible person does not claim return of the amount or is not identifiable, the amount must be deposited in the Consumer Welfare Fund; (c) imposition of penalty (d) cancellation of registration (iv) to furnish a performance report to the GST Council by the 10th of the month succeeding each quarter [Rule 127 of the CGST Rules, 2017].
sir i am registered person i supply both taxable & exempted goods on transportation of taxable goods we take itc of tax paid under Rcm Wheather RCM tax paid on transportation of cotton seed oil cake is available for ITC to me Rahul (Posted On: 22 Jul, 2020)

Reference shall be made to the provisions of Section 17 of CGST which can be read as below ?(2) Where the goods or services or both are used by the registered person partly for effecting taxable supplies including zero-rated supplies under this Act or under the Integrated Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts, the amount of credit shall be restricted to so much of the input tax as is attributable to the said taxable supplies including zero-rated supplies? Sir if transportation is in relation to exempted goods then credit of tax paid under RCM shall not be available. In the query being asked that whether tax paid on transportation of cotton seed oil cake shall be available or not? Since the product is taxable @5% then the credit shall also be available. Sir if transportation is in relation to exempted goods then credit of tax paid under RCM shall not be available. In the query being asked that whether tax paid on transportation of cotton seed oil cake shall be available or not? Since the product is taxable @5% then the credit shall also be available.
XYZ Ltd. is taking service of rent a cab. We hire a car for transportation of their employees and paid gst under rcm 5% . We want to know that is there any scheme in gst in which he can claim itc on tax paid in rent a cab scheme. (Posted On: 21 Jul, 2020)

Section 17(5) of CGST Act 2017 blocks the credit pertaining to Rent-a-cab except when there is same outward supplies. Section 17(5) has been amended vide the Finance Act 2018 wherein a proviso has been inserted which reads as follows ?Provided that the input tax credit in respect of such goods or services or both shall be available, where it is obligatory for an employer to provide the same to its employees under any law for the time being in force.? So if providing the facility of rent a cab is obligatory then the credit shall be available.
I am getting registered under the RERA ACT and paying registration charges for the same. Am I liable to pay tax under RCM? (Posted On: 21 Jul, 2020)

We shall put forward entry of Exemption notification No. 12/2017- Central Tax (Rate) dated 28.06.2017which is as follows 47 Heading 9983 or Heading 9991 Services provided by the Central Government, State Government, Union territory or local authority by way of- (a) registration required under any law for the time being in force; (b) testing, calibration, safety check or certification relating to protection or safety of workers, consumers or public at large, including fire license, required under any law for the time being in force. Nil Nil As registration under RERA Act is registration under any law then it shall fall under the highlighted portion of the above table of notification and shall be exempt from tax.
We are paying one time charges for Patta Registration of land to Jodhpur Development Authority (JDA). Further the patta after registration is then submitted in the court where again charges are being paid. Are we liable to pay tax under RCM on the above mentioned charges? (Posted On: 21 Jul, 2020)

Discussing the first transaction of paying one time charges to JDA light is to be brought on Entry No. 5 to Notification No. 13/2017 dated 28.06.2017 which is reiterated for easy reference 5 Services supplied by the Central Government, State Government, Union territory or local authority to a business entity excluding, - (1) renting of immovable property, and (2) services specified below- (i) services by the Department of Posts by way of speed post, express parcel post, life insurance, and agency services provided to a person other than Central Government, State Government or Union territory or local authority; (ii) services in relation to an aircraft or a vessel, inside or outside the precincts of a port or an airport; (iii) transport of goods or passengers. Central Governme nt, State Governme nt, Union territory or local authority Any business entity located in the taxable territory JDA shall fall in the definition of ?local Authority? mentioned in Section 2(69) of CGST Act 2017 and so you are liable to pay tax under RCM. Coming to the second transaction, we shall put forward entry of Exemption notification No. 12/2017- Central Tax (Rate) dated 28.06.2017which is as follows 47 Heading 9983 or Heading 9991 Services provided by the Central Government, State Government, Union territory or local authority by way of- (a) registration required under any law for the time being in force; (b) testing, calibration, safety check or certification relating to protection or safety of workers, consumers or public at large, including fire license, required under any law for the time being in force. Nil Nil The second transaction shall fall under the highlighted portion of the above table of notification and shall be exempt from tax.
While filing GSTR 3B for the period 2018-19, sale of Rs. 2,00,000/- was shown excess which was adjusted next year in the month of April 2019. How is this to be reported in GSTR-9? (Posted On: 21 Jul, 2020)

Sale of Rs. 2,00,000 is to be shown in column 4B of GSTR 9 and the adjustment made in next year is to be shown in table 11 of part 5 "supplies/tax reduced through amendments".
Marketing staff go outstation and book a hotel. Hotel charged cgst and sgst can they take credit of the same? (Posted On: 21 Jul, 2020)

Before answering the question let us have a look at the place of supply provision of Section 12(3)(b) of IGST Act 2017 which reads as ?the place of supply of services by way of lodging accommodation by a hotel, inn, guest house, home stay, club or campsite, by whatever name called, and including a house boat or any other vessel shall be the location at which the immovable property or boat or vessel, as the case may be, is located or intended to be located.? Therefore the place of supply shall be that of the service provider and the service provider which charge CGST and SGST for the above-said services even if the service recipient is located in interstate. There is no issue in taking Input Tax Credit in case of the intra-state supply of hotel accommodation services. If the service providers supply the service to the interstate located recipient of service in this case recipient of service cannot take the input tax credit related to hotel accommodation/stay because the place of supply for these particular services is of the service provider and service provider charge always CGST and SGST.
Is waiver of late fees also applicable to GSTR-4? (Posted On: 20 Jul, 2020)

The waiver of late fees as per Notification No. 57/2020-central tax dated 30.06.2020 is for GSTR-3B but not for GSTR-4 filled by composition dealers.
XYZ ltd. is obtaining rent ? a ? cab facility from unregistered person. Is XYZ ltd. required to pay tax under RCM? (Posted On: 20 Jul, 2020)

Notification No. 22/2019-central Tax (Rate) has been issued inserting the following entries to the Notification No. 13/2017-Central tax rate dated 28.06.2017 prescribing the rates for RCM. 15 Services provided by way of renting of a motor vehicle provided to a body corporate. Any person other than a body corporate, paying central tax at the rate of 2.5% on renting of motor vehicles with input tax credit only of input service in the same line of business Any body corporate located in the taxable territory So on reading of the above provision, it indicates that if services are obtained from unregistered person then the body corporate need not pay under RCM. So XYZ Ltd. is under no liability to pay tax under RCM.
We supplied Goods at concessional rate @ 5% in terms of the Central Tax (Rate) Notification No. 45 of 2017 dt 14th November, 2017, being supply of Goods at concessional GST rate of on scientific and technical equipments supplied to public funded research institutions.However, the Input rate of these Goods is @18%, and, therefore, there is accumulation of ITC in Electronic Credit Ledger. (1) Is it a case of inverted duty structure....? (2) Whether we can claim for Refund of the accumulated ITC...? (Posted On: 20 Jul, 2020)

Yes sir it is a clear case of inverted duty structure, as the output rate is less than that of the input rate. Refund of the same can be availed as per the provisions of Section 54 of CGST Act 2017. Even refund of goods supplied at concessional rate of 0.1% to merchant exporter is also allowed under inverted duty structure.
Sir the goods have been seized while in transit and I had paid tax and penalty. Can I as a recipient of these goods claim credit of GST paid on these goods. (Posted On: 20 Jul, 2020)

As per the details mentioned in the query, we understand that tax has been paid as per the provisions of Section 129 of CGST Act 2017 which deals with the provisions of detention, Seizure and release of goods and conveyances in transit. Coming to the question of claiming credit by the recipient, we need to look into the provisions of section 17(5) which deals in blocked credit containing the following entry ?(i)any tax paid in accordance with the provisions of sections 74, 129 and 130.? So credit cannot be claimed by the recipient. However, if invoice was prepared at the time of sending of goods and these were seized due to variation in e-way bill and invoice, then you have pay tax twice. Once for release of goods, you have to pay tax and penalty under section 129 within seven days. Secondly, you have to upload invoice in GSTR-1 and pay the tax in GSTR-3B on this invoice. The credit of such duty paid on this invoice will be available to recipient.
We have posted one query yesterday but there is confusion about the same. We are once again posting the same. A transporter is engaged in transportation of petrol. He is paying GST under forward charge method @ 12 and intends to avail the credit. Whether ITC on insurance of fuel tanker can be availed, these tankers are used in transporting petrol for petrol pump. (Posted On: 20 Jul, 2020)

Yes ITC shall be available as Section 17(5) does not restrict ITC with respect to Repair & maintenance, Insurance of vehicles used for transportation of goods. The query was misunderstood. It was regarding transportation of goods under forward charge. Although he is transporting petrol yet these are goods only. Hence, the credit of GST paid on insurance of fuel tanker used for transportation of goods is available.
Sir I have engaged in the business of raw cotton to cotton bales, cotton seed , cotton oil and cotton oil cake. I was paying duty on sale of goods in vat regime and no itc taken. As on 30.06.2017 i have some stock of cotton oil cake and the same was sale in GST era which was exemoted goods. Now my query is i have to pay the gst @5% becauae before gst it is taxable @5% or not. And any reversal of itc in cash form. SOURABHI Gupt (Posted On: 19 Jul, 2020)
When shall the particulars relating to any proceedings or prosecution be published? (Posted On: 18 Jul, 2020)

Ans. When the Commissioner/authorised officer is of opinion that it is necessary or expedient in the public interest to publish the name of any person and any other particulars relating to any proceedings or prosecution under the CGST Act in respect of such person, it may cause to be published such name and particulars [Section 159(1)] No publication under this section shall be made in relation to any penalty imposed under the CGST Act until the time for presenting an appeal to the Appellate Authority under section 107 has expired without an appeal having been presented or the appeal, if presented, has been disposed of [Section 159(2)].
We are located in Ahmedabad and we are sending goods for job work to Mumbai. After completion of job work we will export goods directly from Mumbai. Will there be any GST liability? (Posted On: 18 Jul, 2020)

Ans. There would be no GST liability. Refer Circular 38/2018-CGST ? Excerpt from the same: Section 143 of the CGST Act provides that the principal may supply, from the place of business / premises of a job worker, inputs after completion of job work or otherwise or capital goods (other than moulds and dies, jigs and fixtures or tools) within one year or three years respectively of their being sent out, on payment of tax within India, or with or without payment of tax for exports, as the case may be. This facility is available to the principal only if he declares the job worker?s place of business / premises as his additional place of business or if the job worker is registered.
When goods sent to job worker and same has been lost / destroyed at job worker premises, will it be considered as deemed supply? (Posted On: 18 Jul, 2020)

Ans. a. Scenario 1 ? When goods are destroyed after receipt of goods by job worker: In this case principal needs to treat it as a deemed supply and raise tax invoice for the same as the goods cannot be returned within time limit prescribed. b. Scenario 2 ? When goods destroyed before receipt of goods to job worker (goods in transit): In this case principal need to reverse ITC according to Section 17(5)(h), as the goods are destroyed in the transit where possession of goods are not yet transferred to the job worker.
Can ITC on insurance of fuel tanker be availed if tankers are use in petrol pump? (Posted On: 18 Jul, 2020)

Ans. Section 17(5)(ab) says that credit relating to services of general insurance, servicing, repair and maintenance in so far as they relate to motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa). Therefore, ITC shall be available as Section 17(5) does not restrict ITC with respect to Repair & maintenance, Insurance of vehicles used for transportation of goods.
When goods sent outside the India for the purpose of job work, do we need to disclose in the ITC-04? (Posted On: 18 Jul, 2020)

There is no exception for the said case. It should be disclosed in ITC-04.
Will goods sent for repairs & maintenance be considered as job work? (Posted On: 18 Jul, 2020)

In our opinion repairs & maintenance and job work are two different concepts under GST as Repairs & maintenance do not change the nature of the goods. While job work might result in change in nature of goods. Further these two fall under two different HSN codes that is R & M under 9987 and Job work under HSN 9988. Concept behind repairs / job work services has been brought out in the West Bengal AAR M/s. Bhanuka enterprises (No. 47/WBAAR/2018-19 dated 26th Mar 2019).
While filing GSTR-9 wrong figure has been reported in the sales figure by mistake which doesn?t match with the books of accounts. This mistake was realised while filing GSTR-9C a difference has arisen in table 5. What shall I do now? (Posted On: 18 Jul, 2020)

In our opinion in GSTR-9C the correct figures as reflected in books of accounts should be shown. And the reason for unreconciled amount in Column 5R shall be mentioned that incorrect amount of sales being mentioned in GSTR-9. Further a correct copy of GSTR-9 signed and sealed by taxpayer shall be attached along with GSTR-9C.
XYZ is supplying Sweets and Namkeen. They are having shop as well as restaurant. Items like Samosa if supplied from shop they are charging 12% GST and if served in a restaurant they are charging 5% GST. The same Samosa many times they get orders over phone which they make home delivery. The GST Rate for such home delivery will be 12% or 5%? Kaustubh Karandikar (Posted On: 17 Jul, 2020)

Ans. In this case it shall depend on from which section is the bill being raised. If it is raised from restaurant, then GST @ 5% shall be applicable and if billed from shop then GST @ 12% shall be chargeable. In case of M/s Kundan Mishthan Bhandar (GST AAAR Uttarakhand)(order No. Order No. 04/18-19 dated 27.02.2019), AAAR ruled that- (i)Sale of sweets, namkeens, cold drinks and other edible items through restaurant will be treated as ?composite supply? with restaurant supply being the principal service. Existing GST rates on restaurant service will also be applicable on all such sales and no input credit will be allowed. (iii) Sale of sweets, namkeens, cold drinks and other edible items from sweetshop counter will be treated as supply of goods with applicable GST rates of the items being sold and input credit will be allowed on such supply. (iv) The applicant should maintain separate records for restaurant and sweetshop with respect to input and output and billings as well as other accounting records should also be separately maintained.
In Vizag, in our apartment, we all pay to our Society towards water charges on actual consumption, we all have individual meters. Total we have 80 flats in our apartment. The Society pay 2 Municipal authorities as per the bill raised by them. There are some common areas also where Society uses water, difference between amount received by the flat owner?s n actual bill raised by Municipal authorities are consumption of Society. My question here is should we charge Service Tax on amount collected from the residents? If so, what is the percentage to be applied on actual charges? Our Society raises Invoice on each flat owner foractual consumption of water charges. (Posted On: 15 Jul, 2020)

Ans. Circular No. 109/28/2019-GST dated 22.07.2019 was issued in clarification to GST on monthly subscription/contribution charged by a Residential Welfare Association from its members. In this circular the following issue and clarification has been issued Sl. No. Issue Clarification 1 Are the maintenance charges paid by residents to the Resident Welfare Association (RWA) in a housing society exempt from GST and if yes, is there an upper limit on the amount of such charges for the exemption to be available? Supply of service by RWA (unincorporated body or a non- profit entity registered under any law) to its own members by way of reimbursement of charges or share of contribution up to an amount of Rs. 7500 per month per member for providing services and goods for the common use of its members in a housing society or a residential complex are exempt from GST. Prior to 25th January 2018, the exemption was available if the charges or share of contribution did not exceed Rs 5000/- per month per member. The limit was increased to Rs. 7500/- per month per member with effect from 25th January 2018. [Refer clause (c) of Sl. No. 77 to the notification No. 12/2018- Central Tax (Rate) dated 28.06.2019] As said in the query it appears that the society is not acting as pure agent. If the charges collected are above Rs. 7500 per month per member then exemption is not available. And the rate of tax that shall be applicable is 18%. Moreover, recently in case of Apsara co-operative housing society, The Maharashtra AAR ruled that the activities of Property Taxes and water charges collected by society for paying to Municipal Corporation are covered under Section 7 of the CGST Act.
Dear Sir,I have downloaded the auto populated Forms from The GST Portal for GSTR9, GSTR3B and GSTR1.Upon checking, the Taxable values show different figures in all the three forms. How should I enter the correct Taxable Value according to the books of accounts?Secondly in the year 2018-19 excess Input Tax Credit was claimed which was not reversed, can the difference amount be revised in GSTR 9.Also, during the same period The Input IGST was wrongly claimed under CGST and SGST, is there any solution to this issue Kindly assist us on these queries. (Posted On: 15 Jul, 2020)

Ans. First of all, you should file a grievance on online portal regarding the issue faced. While filing GSTR 9, the figures as per books of accounts should be considered rather than already filled in GSTR 3B and GSTR 1. The portal will pop a message if the difference between the auto populated figures and actual figures vary by more than 20%. This should not be a matter to worry. You should proceed filing GSTR 9 with the correct figures. The excess credit availed can only be reversed with DRC 03 along with interest. No payment or reversal can be done through Annual return The wrong credit availed under CGST and SGST should be reversed along with interest by DRC 03 and IGST credit stands lapsed because due date of availing credit was last date of filing of September 2019 GSTR 3B return.
Financial Credit Note has been issued by the supplier of goods. How to report the same in the Annual Return? (Posted On: 15 Jul, 2020)

Ans. There is no GST implication on the Financial Credit Note. It is not required to be disclosed in Form GSTR-1/GSTR-3B. Hence, the same is not required to be disclosed in the Annual return also. Table 4I which requires disclosure of credit note is applicable only for credit notes which are issued in accordance with the section 34 of the CGST Act.Financial Credit Note will form part of reconciliation statement between audited annual accounts and GST Return and hence will be required to be disclosed in the reconciliation statement in form GSTR-9C in Table 5J- Credit Notes Accounted for in the Audited Financial Statements but are not permissible under GST.
On what questions can the advance ruling be sought? (Posted On: 15 Jul, 2020)

Ans. As per section 97(2) of CGST Act, 2017, advance ruling can be sought for the following questions (a) classification of any goods or services or both (b) applicability of a notification issued under the CGST Act (c) determination of time and value of supply of goods or services or both (d) admissibility of input tax credit of tax paid or deemed to have been paid (e) determination of the liability to pay tax on any goods or services or both (f) whether applicant is required to be registered (g) whether any particular activity with respect to any goods and/or services, amounts to/results in a supply of goods and/or services, within the meaning of that term.
While preparing E way bill I found that the receiver?s E way bill is blocked. How to send the goods? Do I have any alternative? (Posted On: 15 Jul, 2020)

Ans. The only alternative way is that the receiver shall be required to file all the pending returns and unblock his portal. Further if the consignment value is below Rs. 50,000/- then there is no requirement to generate E way bill.
Got a works contract of immovable property in other state.We have taken GST registration in that state also. But goods supplied under above contract is supplied from our plant at IGST while services(erection) is billed from local registration of that state charing CGST & SGST. Is it valid under GST laws that for same works contract two different type of billing done i.e. IGST & CGST/SGST billing is done to customer? sunil bhageria (Posted On: 15 Jul, 2020)

There is no problem if you charge both IGST & CGST/SGST in two different bills to the same customer. As the transaction would be Inter-state or Intra-state supply shall depend upon place of supply, location of supplier and recipient. And tax shall be charged accordingly.
i am transporting fuel on behalf of Indian Oil Corp Ltd to petrol pump owner. payment is to be made by IOCL to me. Shall i charge GST from IOCL? suman kumar mallick (Posted On: 15 Jul, 2020)

It would depend upon on the option opted by you if you are a GTA. The options are as follows a. Charging @12% with ITC b. Charging @5% without ITC c. Not charging GST on consignment note since liable to be paid under RCM by the service recipient. Charging of GST on the consignment note shall depend on the option selected by you.
Hello sir we are making supplies to Government Company. As per the terms in the agreement if there is delay in making supply then they shall charge liquidated damages. Are these liquidated damages chargeable to GST? (Posted On: 14 Jul, 2020)

Ans. Yes, liquidated damages are chargeable to GST as entry in Schedule II reads as ?(e) agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act; and? treats it as supply of services. Notification No. 13/2017- Central Tax (Rate)dated 28th June, 2017- Entry No. 5 states that Services supplied by the Central Government, State Government, Union territory or local authority to a business entity excluding, - (1) renting of immovable property, and..................................... Therefore, as per this entry, if services are received from Government Company, then RCM is not applicable. In this case tax shall be applicable at the rate of 18% on forward charge basis.
Sir I am a contractor and have provided construction service of Single residential unit. Whether this is exempt or do I need to charge tax? (Posted On: 14 Jul, 2020)

Ans. The relevant entry no. 11 of Notification No. 12/2017 Central Tax (Rate) dated 28.06.2017 is reproduced for ease of reference. Sl No. Chapter, section, heading, group Description of services Rate Condition 1 Heading 9954 Services by way of pure labour contracts of construction, erection, commissioning, or installation of original works pertaining to a single residential unit otherwise than as a part of a residential complex. Rate is Nil, Condition is Nil From the above entry it is clear that the services provided are of pure labour contracts then the benefit of exemption can be availed but along with labour if material is also involved then it is chargeable to tax.
Construction of road in factory premise. Whether we can avail ITC of concrete and other items relates to this activity or not? (Posted On: 14 Jul, 2020)

Ans. Credit shall not be available as construction of road is construction of immovable property as the relevant clause of (d) of section 17(5) pertaining to blocked credit reads as follows- ?goods or services or both received by a taxable person for construction of animmovable property (other than plant or machinery) on his own account includingwhen such goods or services or both are used in the course or furtherance of business.?
Hello, If we have more tax liability while filing GSTR 9 or 9C then can we use ITC available in Electronic Credit Ledger for paying the excess tax liability? Thank you! (Posted On: 13 Jul, 2020)

As per instruction available for filing GSTR-9 and 9C, towards the end of the return, taxpayers shall be given an option to pay any additional liability declared in this form, through FORM DRC-03. Taxpayers shall select ?Annual Return or Reconciliation Statement respectively? in the drop down provided in FORM DRC-03. It may be noted that such liability can be paid through electronic cash ledger only. Thus, taxpayer cannot use amount available in electronic credit ledger for payment of additional liability due to GSTR-9 or GSTR-9C. However, option of credit ledger is available while filing DRC-03 which should not be there.
How are zero-rated supplies different from exempt supplies made by a registered person in respect of issuance of invoice? (Posted On: 13 Jul, 2020)

Zero rated supply means any of the following supplies of goods or services or both, namely: (a) export of goods or services or both; or (b) supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit [Section 2(23) of the IGST Act read with section 16 of the IGST Act]. A registered person supplying exempted goods or services or both shall issue, instead of a tax invoice, a bill of supply whereas in case of zero-rated supplies, normal tax invoice shall be issued.
Should the registered person disclose details of ?notice pay? recovery from employees in FORM GSTR-9C? If yes, where should it be reported? (Posted On: 13 Jul, 2020)

If the registered person has considered the notice pay recovered from employees as a taxable supply but has not disclosed the same as an income in the Profit and Loss account; it would be reported under Sl. No. 5O of FORM GSTR-9C for the purpose of reconciliation. Data for such recoveries can be ascertained from credits in the Salary/ Wages ledger maintained in the books of accounts.
Is it necessary to execute a bond for effecting zero rated supplies? (Posted On: 13 Jul, 2020)

No. The facility to export under LUT has been extended to all zero rated suppliers (barring a few exceptions such as those who have been prosecuted for an offence involving tax of Rs. 2.5 crore) vide Notification No. 37/2017 CT dated 4.10.2017. The other conditions for executing LUT have been specified in Circular No. 8/8/2017 GST dated 4.10.2017. Exporter can also export on payment of duty.
How are imports taxed under GST? (Posted On: 11 Jul, 2020)

All imports are deemed as inter-state supplies for the purposes of levy of GST (IGST). The incidence of tax follows the destination principle and the tax revenue in case of SGST accrues to the State where the imported goods and services are consumed. IGST paid on import of goods and services is available as ITC for set off against the output tax liability. IGST on import of goods is leviable under the provisions of the Customs Tariff Act.
What are the provisions relating to rectification of errors apparent on the face of record? (Posted On: 11 Jul, 2020)

Section 161 lays down that any authority, who has passed or issued any decision or order or notice or certificate or any other document, may rectify any error which is apparent on the face of record in such decision or order or notice or certificate or any other document, either on its own motion or where such error is brought to its notice by any GST officer or by the affected person within a period of three months from the date of issue of such decision or order or notice or certificate or any other document, as the case may be. However, no such rectification shall be done after a period of six months from the date of issue of such decision or order or notice or certificate or any other document. Further, the said period of six months shall not apply in such cases where the rectification is purely in the nature of correction of a clerical or arithmetical error, arising from any accidental slip or omission. Principles of natural justice should be followed by the authority carrying out such rectification, if it adversely affects any person.
I am a registered person and sell waste left in the factory. The person purchasing the waste has installed machinery in our premises for compressing it and then transports it in order to save his transportation cost. Am I required to generate E way bill? (Posted On: 11 Jul, 2020)

Yes sir, you are required to generate the E way Bill If the value of the consignment is more than Rs. 50,000/-. Rule 138 of CGST Rules reads as follows ?(1) Every registered person who causes movement of goods of consignment value exceeding fifty thousand rupees? (i) in relation to a supply; or (ii) for reasons other than supply; or (iii) due to inward supply from an unregistered person, shall, before commencement of such movement, furnish information relating to the said goods as specified in Part A of FORM GST EWB-01, electronically, on the common portal along with such other information as may be required on the common portal and a unique number will be generated on the said portal? Therefore, if the value of waste is more than 50,000, then you are required to raise e way bill.
I am a private limited company and have purchased Ambulance for workers and staff. Can Credit be availed? (Posted On: 11 Jul, 2020)

The amendment made vide CGST (Amendment) Act, 2018 effective from 01.02.2019 under section 17(5)(a) reads as follows- 17(5)(a) - motor vehicles for transportation of persons having approved seating capacity of not more than thirteen persons (including the driver), except when they are used for making the following taxable supplies, namely: (A) further supply of such motor vehicles; or (B) transportation of passengers; or (C) imparting training on driving such motor vehicles; In our opinion, ambulance credit will be available since it is used for transportation of patients (passengers) without any condition.
Hello sir, I am registered in the state of Assam. I have sent Cylinders for job work to a registered person in the state of Kanpur. Now I want to sell these cylinders to my another unit registered in Rajasthan directly from Job worker?s premises. How is the E-way bill to be generated? (Posted On: 11 Jul, 2020)

This is a bill to ship to situation. The job worker shall generate E way bill wherein your name shall be addressed in the table ?Bill to? and in the ?ship to? column the address of Rajasthan shall be mentioned. Further you have to raise on invoice person registered in Rajasthan and mention in the invoice that E-way bill was generated by Job worker as the supply was directly made from their premises. This model of E-way bill was clarified by CBIC by Press release dated 23.04.2018.
My client is a service exporter. They have executed a LUT and do exports without payment of GST. They have received advances from the foreign client. Should this be shown in GSTR1. Should GST be paid on such advances. Ravikumar (Posted On: 10 Jul, 2020)

In our opinion there is no need to pay tax on advances as we are exporting under LUT. There is no express provision in law for this.
In March?20, XYZ supplied goods to a customer and GST was paid on it but due to lockdown goods were lying with transporter?s godown. Now, in July?20 the customer is refusing to accept the delivery and therefore XYZ wants to bring it back to their registered premises from the transporters godown. Sir, in my view, XYZ need to prepare Delivery Challan and E ? Way Bill and bring back the goods. As regard to GST already paid to govt., strictly speaking XYZ need to claim for the refund since they cannot issue credit note nor they can adjust the amount from this months liability under this situation. Kindly guide. Kaustubh Karandikar (Posted On: 10 Jul, 2020)

As per Section 34(2) of CGST Act 2017 reads as follows ?Any registered person who issues a credit note in relation to a supply of goods or services or both shall declare the details of such credit note in the return for the month during which such credit note has been issued but not later than September following the end of the financial year in which such supply was made, or the date of furnishing of the relevant annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as may be prescribed? This means that a person can issue credit note either before September or filing of annual return whichever is earlier. In the present case XYZ can bring back the goods from the transporter?s premises on the basis of E way bill and can issue Credit note upto September 2020. So that the liability shall be reduced in the coming month?s returns.
Can an advance ruling given be nullified? (Posted On: 10 Jul, 2020)

Section 104 states the circumstances under which the ruling would be considered as void and hence would lose its binding value. - If the Authorities (AAR and Appellate Authority) find that the advance ruling pronounced has been obtained by the applicant/appellant by fraud or suppression of material facts or misrepresentation of facts, it may, by order, declare such ruling to be void ab-initio. - Consequently, all the provisions of the CGST Act shall apply to the applicant as if such advance ruling had never been made (but excluding the period when advance ruling was given and up to the period when the order declaring it to be void is issued). - An order declaring advance ruling to be void can be passed only after hearing the applicant/ appellant. - A copy of the order so made shall be sent to the applicant, the concerned officers and the jurisdictional officer.
Government has waived late fees on delayed filing of returns. What if I have already paid the same. (Posted On: 10 Jul, 2020)

Government has announced the refund of late fees for those who have already paid. But there is no notification being issued yet. The announcement has been made through twitter that late fees already paid will be credited in the ledger of the taxpayers.
Heard the news of merging of the direct and indirect tax boards. Would it be of help to the taxpayers. Please Comment. (Posted On: 10 Jul, 2020)

Sir the finance ministry has denied reports of merging Central Board of Direct Taxes (CBDT) and Central Board of Indirect Taxes and Customs (CBIC), terming it as "factually incorrect".
Can I File nil GSTR-3B return through SMS? (Posted On: 10 Jul, 2020)

Notification No. 58/2020 ? Central tax dated 01.07.2020 has been issued wherein Rule 67A has been substituted which provides for ?Manner of furnishing of return or details of outward supplies by short messaging service facility.? So Nil GSTR-3B return and GSTR-1 both can be filed by way of SMS which shall be sent by registered mobile number.
Sir, I am a registered person and have purchased truck; the ITC of which has been claimed. I gave this truck to a transporter on rent who further gives on rent. Am I liable to charge GST on rent received or is it exempt income. (Posted On: 10 Jul, 2020)

Entry No. 22 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 is being reiterated as follows. Sl. No. Chapter, Section, Heading, Group or Service Code (Tariff) Description of Services Rate (per cent.) Condition 22 Heading 9966 or Heading 9973 Services by way of giving on hire ? (a) to a state transport undertaking, a motor vehicle meant to carry more than twelve passengers; or (b) to a goods transport agency, a means of transportation of goods. Nil Nil As per the above entry the rental income received by you is exempt.
What rate of tax shall be applicable if I provide canteen services to a company on agreement basis? (Posted On: 09 Jul, 2020)

Notification No. 13/2018-Central Tax (Rate) dated 26.07.2018 has been issued wherein rate of 5% without ITC has been specified. The relevant entry is as follows ?(i) Supply, by way of or as part of any service of goods. being food or any other article for human consumption or any drink, provided by a restaurant, eating joint including mess, canteen, whether for consumption on or away from the premises where such food or any other article for human consumption or drink is supplied, other than those located in the premises of hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes having declared tariff of any unit of accommodation of seven thousand five hundred rupees and above per unit per day or equivalent. Explanation 1:- This item includes such supply at a canteen, mess, cafeteria or dining space of an institution such as a school, college, hospital, industrial unit, office, by such institution or by any other person based on a contractual arrangement with such institution for such supply, provided that such a supply is not event based or occasional. Explanation 2.- This item excludes the supplies covered under item 7 (v). Explanation 3.- ?declared tariff? includes charges for all amenities provided in the unit of accommodation (given on rent for stay) like furniture, air conditioner, refrigerators or any other amenities, but without excluding any discount offered on the published charges for such unit. 2.5 Provided that credit of input tax charged on goods and services used in supplying the service has not been taken [Please refer to Explanation no. (iv)|
I sold goods worth Rs. 1,00,000 in the month of June 2018 and giving discount of Rs. 10,000 is in the month of December 2019 due to quality reasons. Can I issue credit note giving tax effect? (Posted On: 09 Jul, 2020)

Section 34(2) of CGST Act reads as follows ?Any registered person who issues a credit note in relation to a supply of goods or services or both shall declare the details of such credit note in the return for the month during which such credit note has been issued but not later than September following the end of the financial year in which such supply was made, or the date of furnishing of the relevant annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as may be prescribed.? In the present case as the discount is being given in the month of December 2019 which is later than the prescribed time limit of September 2019 then credit note effecting GST cannot be issued. A commercial or financial credit note (credit note without tax effect) is to be issued in your case.
If I have availed benefits of notification 79/2017-customs and imported some inputs under advance authorisation, but simultaneously I have purchased some of the inputs from domestic market and also used some services commonly for exported goods and goods supplied domestically. Whether I have to file refund under rule 89(4B) only? Or I can file under rule 89(4) also same as I usually file when there is no benefits taken under notification 79/2017-customs. Further, if I required to file refund claim under rule 89 (4B), how to file claim? Which documents will be required to justify my claim (Posted On: 09 Jul, 2020)

Refund has to be filed under Rule 89(4B) only as the benefit of notification no. 79/2017 has been availed and the relevant portion of the excerpt has been highlighted for your quick reference ?(4B) Where the person claiming refund of unutilised input tax credit on account of zero rated supplies without payment of tax has ? (b) availed the benefit of notification No. 78/2017-Customs, dated the 13th October, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R 1272(E), dated the 13th October, 2017 or notification No. 79/2017-Customs, dated the 13th October, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R 1299(E), dated the 13th October, 2017, the refund of input tax credit, availed in respect of inputs received under the said notifications for export of goods and the input tax credit availed in respect of other inputs or input services to the extent used in making such export of goods, shall be granted.?
Sir I am a manufacturer and have received goods after 2 years from distributor via retailer as the goods have been expired. I have destroyed the goods received. What shall be the tax effect? (Posted On: 09 Jul, 2020)

In this case, we suggest that the distributor should raise fresh invoice to you(manufacturer) as credit note cannot be issued as per section 34(2) of CGST Act which reads as follows- ?Any registered person who issues a credit note in relation to a supply of goods or services or both shall declare the details of such credit note in the return for the month during which such credit note has been issued but not later than September following the end of the financial year in which such supply was made, or the date of furnishing of the relevant annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as may be prescribed.? As the goods received back are being destroyed, the credit of the same cannot be availed as Section 17(5)(b) blocks the credit. The relevant excerpt in this regard is as follows ?(h) goods lost, stolen, destroyed, written off or disposed of by way of gift or freesamples; and?
I have purchased Omni van for carrying goods. Can I avail credit of the same? (Posted On: 09 Jul, 2020)

Yes, you can avail the credit if the motor vehicle is used for transportation of goods. The amendment made vide CGST (Amendment) Act, 2018 effective from 01.02.2019 under section 17(5)(a) reads as follows ?17(5)(a) motor vehicles for transportation of persons having approved seating capacity of not more than thirteen persons (including the driver), except when they are used for making the following taxable supplies, namely:? (A) further supply of such motor vehicles; or (B) transportation of passengers; or (C) imparting training on driving such motor vehicles;? (aa) vessels and aircraft except when they are used?? (i) for making the following taxable supplies, namely:? (A) further supply of such vessels or aircraft; or (B) transportation of passengers; or (C) imparting training on navigating such vessels; or (D) imparting training on flying such aircraft; (ii) for transportation of goods; A harmonious reading of the above section states that if motor vehicle , vessel or aircraft is used for transportation of goods, then credit can be availed.
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Krishna Motors is a car dealer selling cars of an international car company. It also provides maintenance and repair services of the cars sold by it as also of other cars. It seeks your advice on availability of input tax credit in respect of the following expenses incurred by it during the course of its business operations: (i) Cars purchased from the manufacturer for making further supply of such cars. Two of such cars are destroyed in accidents while being used for test drive by potential customers. (ii) Works contract services availed for constructing a car shed in its premises. (Posted On: 08 Jul, 2020)

As per section 16(1) of the CGST Act, 2017, every registered person can take credit of input tax charged on any supply of goods or services or both to him which are used or intended to be used in the course or furtherance of his business. However, section 17(5) of CGST Act, 2017 specifies certain goods and services on which the input tax credit is not available. In the light of the foregoing provisions, the availability of input tax credit (ITC) in respect of the various expenses incurred by Krishna Motors is discussed below: (i) Section 17(5) specifically blocks ITC on Motor vehicles used for transportation of persons having approved seating capacity of not more than thirteen persons (including the driver) Except when they are used for making the following taxable supplies: (A) further supply of such motor vehicles; or (B) transportation of passengers; or (C) imparting training on driving such motor vehicles Thus, ITC on cars purchased from manufacturer for making further supply of car will be allowed. However, ITC on the cars destroyed in accident will not be allowed as the ITC on goods destroyed for whichever reason is specifically blocked [Section 17(5) of CGST Act] (ii) Section 17(5)(c) specifically blocks ITC on works contract services when supplied for construction of an immovable property (other than plant and machinery) except where it is an input service for further supply of works contract service. Since, in this case the car shed is not a plant and machinery and the works contract service is not used for further supply of works contract service, ITC thereon will not be allowed.
Supply was made in the year 2017-18, and the goods are being now returned back in the year 2020. What shall I do? (Posted On: 08 Jul, 2020)

As per Section 34(2) of the CGST Act, 2017, Any registered person who issues a credit note in relation to a supply of goods or services or both shall declare the details of such credit note in the return for the month during which such credit note has been issued but not later than September following the end of the financial year in which such supply was made, or the date of furnishing of the relevant annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as may be prescribed. Therefore, in the present case, Credit note cannot be issued as the same with tax effect could have been issued till March 2019 (Due date is September but the extended date for 2017-18 is March 2019). So we suggest that a fresh sales invoice shall be issued by the person returning the goods.
Sir the output rate of the goods manufactured is 5% and the rate of the inward supplies is also 5%. However, in addition to the purchase of main raw material, we also purchased some other goods for manufacturing and other allied activities at the rate of 18% but the percentage of these inputs constitutes only 15-20% of the total inputs purchased. Can I avail the refund under Inverted duty structure? (Posted On: 08 Jul, 2020)

A registered person may claim a refund of unutilized ITC on account of Inverted Duty Structure at the end of any tax period where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies. Since Rule 89 and Section 54 of the CGST Act, 2017 don?t restrict the refund on the basis of weightage of the different inputs purchased. Therefore, even if a rate of single input purchased is higher than output sold, the person is eligible for refund under inverted duty structure.
M/s XYZ will pay royalty to service provider situated outside India for which bill has been raised for 10,000 Euros. The rate of exchange of which date is to be considered for arriving at the value in Indian rupees and the liability to pay RCM? Please assume that the payment would be made in instalments. (Posted On: 08 Jul, 2020)

In this regard, the relevant provisions are contained in Rule 34(2) of CGST Rules, 2017 which reads as follows:- Section 34. Rate of exchange of currency, other than Indian rupees, for determination of value.- (1) The rate of exchange for determination of value of taxable goods shall be the applicable rate of exchange as notified by the Board under section 14 of the Customs Act, 1962 for the date of time of supply of such goods in terms of section 12 of the Act. (2) The rate of exchange for determination of value of taxable services shall be the applicable rate of exchange determined as per the generally accepted accounting principles for the date of time of supply of such services in terms of section 13 of the Act. In case of export of goods, the rate of exchange notified by CBIC is applicable but in case of export of services, the rate of exchange as per generally accounting principles is applicable which in our opinion is the RBI rate. Moreover, the date on which rate of exchange is to be applied is dependent of time of supply of services under section 13 of the CGST Act, 2017 which reads as follows:- (3) In case of supplies in respect of which tax is paid or liable to be paid on reverse charge basis, the time of supply shall be the earlier of the following dates, namely:?? (a) the date of payment as entered in the books of account of the recipient or the date on which the payment is debited in his bank account, whichever is earlier; or (b) the date immediately following sixty days from the date of issue of invoice or any other document, by whatever name called, in lieu thereof by the supplier: Provided that where it is not possible to determine the time of supply under clause (a) or clause (b), the time of supply shall be the date of entry in the books of account of the recipient of supply: Since payment would be made in instalments but the bill will be booked entirely in accounts. Consequently, the date on which rate of exchange is to be applied is the date of entry in books of accounts.
Is there any threshold exceeding which tax is required to be deducted? (Posted On: 08 Jul, 2020)

Yes. Tax is required to be deducted from the payment made/credited to a supplier, if the value of supply under a contract in respect of supply of taxable goods or services or both, exceeds Rs. 2,50,000/- (Rupees two lakh and fifty thousand). This value shall exclude the taxes leviable under GST (i.e. ?Central tax?, ?State tax?, ?UT tax?, ?integrated tax? & ?Cess?).
In what cases, assessment order passed by proper officer may be withdrawn? (Posted On: 07 Jul, 2020)

Assessment Order passed by proper officer may be withdrawn in the following cases:- (i) Assessment of Non-filers of return ? The best judgment order passed by the Proper Officer under section 62 of CGST Act shall automatically stand withdrawn if the taxable person furnishes a valid return for the default period (i.e. files the return and pays the tax as assessed by him), within thirty days of the receipt of the best judgment assessment order (ii) Summary Assessment ? A taxable person against whom a summary assessment order has been passed can apply for its withdrawal to the jurisdictional Additional/Joint Commissioner within thirty days of the date of receipt of the order. If the said officer finds the order erroneous, he can withdraw it and direct the proper officer to carry out determination of tax liability in terms of section 73 or 74 of CGST Act. The Additional/Joint Commissioner can follow a similar course of action on his own motion if he finds the summary assessment order to be erroneous.
Sir, What would be the place of supply of services provided by my event management company for organizing a sporting event for a Sports Federation which is held in multiple States? (Posted On: 07 Jul, 2020)

In case of an event, if the recipient of service is registered, the place of supply of services for organizing the event is the location of such person. However, if the recipient is not registered, the place of supply is the place where event is held. Since the event is being held in multiple states and a consolidated amount is charged for such services, the place of supply will be taken as being in each state in proportion to the value of services so provided in each state determined in terms of the contract or agreement entered into in this regard.
Sir, if my bill booked by client but payment received is less than the bill booked then should I liable to pay balance amount GST? (Posted On: 07 Jul, 2020)

GST liability arises at the point of supply is made. The receipt of consideration is not a pre condition in GST except in case of export of services is considered. So in this case your client has to pay the GST on the billing amount as per Sec 7 of supply under GST.
Whether GST charged on services provided in relation to conversion of residential property to commercial property will be available? (Posted On: 07 Jul, 2020)

As per Section 16(1) of the CGST Act, 2017, Every registered person shall, subject to such conditions and restrictions as may be prescribed and in the manner specified in section 49, be entitled to take credit of input tax charged on any supply of goods or services or both to him which are used or intended to be used in the course or furtherance of his business and the said amount shall be credited to the electronic credit ledger of such person. If the commercial property will be used for the purpose of running your business or for letting out, then ITC pertaining to services received is entitled for availment. The property should be used in the course or furtherance of business.
I am a Goods Transport Agency (GTA) engaged in transportation of goods by road. As per the general business practice, and also provides intermediary and ancillary services like loading/unloading, packing/unpacking, transshipment and temporary warehousing, in relation to transportation of goods by road. Whether such services are to be treated as part of the GTA service, being a composite supply, or as separate supplies? (Posted On: 07 Jul, 2020)

Composite supply means a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services or both, or any combination thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply [Section 2(30) of the CGST Act]. The GTA provides various intermediary and ancillary services, such as, loading/unloading, packing/unpacking, transhipment and temporary warehousing, which are provided in the course of transport of goods by road. These services are not provided as independent services but as ancillary to the principal service, namely, transportation of goods by road. The invoice issued by the GTA for providing the said service includes the value of intermediary and ancillary services.
How to rectify the errors done in GSTR-1 for the month ofFebruary, 2020 declaring an outward supply of Rs. 300 lakhs. The return was filed within thedue date of its filing. However, on a subsequent reconciliation of the return with the booksof accounts it was found that 5 invoices having a total value of Rs. 20 lacs towards supplymade to local parties were inadvertently omitted to be reported. (Posted On: 06 Jul, 2020)

As per GST portal, the mechanism of filing amended returns for any correction of errors/omissions has been enabled on the GSTN portal; however the facility to file the same is not enabled. An error message pops us whenever anyone tries to open that page. Therefore, the missed invoices that were not uploaded in February 2020 will be uploaded in subsequent month of GSTR 1. The rectification of errors/omissions is allowed in the subsequent Returns. However, no rectification is allowed after furnishing the return for the month of September following the end of the financial year to which such detailspertain or furnishing of the relevant annual return, whichever is earlier.
Indian Railway is engaged in providing services relating to transportation of goods and passengers by rail. The users of the transportation services provided by IR are not only individual passengers, but also organizations. IR railway has supplied transportation services to PSUs like NTPC, Coal India, SAIL etc. Whether TDS is to be deduced by PSUs availing Railway transportation services? (Posted On: 06 Jul, 2020)

Supply of goods or services or both which takes place between specified/notified categories of tax deductors has been exempted from requirement of tax deduction. For example, supply by one PSU to another PSU is not liable to tax deduction. In the given facts, IR is supplying service to PSUs. Both the supplier and recipient being specified/notified category of tax deductors, such supply is exempted from requirement of tax deduction. Notification 61/2018-Central Tax, dt. 05-11-2018 Seeks to exempt supply from PSU to PSU from applicability of provisions relating to TDS.
Dear Sir, I have received an Advance of Rs 1 lac from the party in December 2019 for which I issued him a bill and paid the GST. Now in July 2020 I have prepared the bill for the balance amount of 3 lacs and paying gst on it. My query is that I have issued 1 bill in fy 19-20 and the other bill to the same party in fy 20-21. While taking this into accounts should I consider these bills separately in different financial years or take in one of the financial year. The final amount will be received by the party in July 2020. Please help me in this matter. (Posted On: 06 Jul, 2020)

It is not necessary that a consolidated bill has to be raised for a single service provided to any customer. Since you have raised two invoices in different financial years, then these bills will be considered separately in different years in books of accounts.
Whether TDS is applicable in following cases: (a) Supply under RCM (b) Supply by unregistered supplier (c) Supply by composition Supplier (Posted On: 06 Jul, 2020)

As per SOP issued by Law Committee (GST Council) dated 28.09.2018, answers to given situations are as stated below: (a) TDS requirement is not applicable in respect of supply received which is under RCM; (b) TDS requirement is not applicable in respect of supply received from unregistered person; (c) TDS requirement is applicable in respect of supply received from composition supplier as he is registered person in GST.
Mohan Enterprises has two registrations in Delhi. Its aggregate turnover for the preceding year for both the registrations was Rs. 90 lakh. It wishes to pay tax under composition levyfor one of the registration in the current year while under normal levy for other, whether he can do so? (Posted On: 06 Jul, 2020)

A registered person with an aggregate turnover in a preceding financial year up to Rs. 1.5 crore is eligible for composition levy in Delhi. Since the aggregate turnover of Mohan Enterprises does not exceed Rs. 1.5 crore, it is eligible for composition levy in the current year. However, all registered persons having the same Permanent Account Number (PAN) have to opt for composition scheme. If one such registered person opts for normal scheme, others become ineligible for composition scheme. Thus, Mohan Enterprises either have to opt for composition levy for both the registered premise or under normal levy for both.
What are the conditions necessary for obtaining ITC? (Posted On: 04 Jul, 2020)

As per Section 16 of CGST Act 2017 following four conditions are to be satisfied by the registered taxable personfor obtaining ITC: (a)he is in possession of tax invoice or debit note or such other tax payingdocuments as may be prescribed; (b)he has received the goods or services or both; (c)the supplier has actually paid the tax charged in respect of the supplyto the Government; and (d)he has furnished the return under section 39.
Easy Coupons Ltd. sells coupons that are redeemable against specified luxury food products at retail outlets. Each coupon has a face value of Rs. 900 but is redeemable for supplies worth Rs. 1000. What is the value of supply of such coupon under GST laws? (Posted On: 04 Jul, 2020)

In terms of rule 32(6) of the CGST Rules relating to valuation, the value of a coupon is the money value of the goods redeemable against it. Therefore, though the coupon is sold for Rs. 900, its value is Rs. 1000.
Sir, Please clarify whether time-limit for refund is applicable or not for "refund from excess balance in electronic cash ledger". It is inferred that excess balance in Electronic Cash Ledger is only deposited and Section 54(1) talks about only such tax or interest, which is paid and not deposited. Further, proviso to Section 54(1) invokes Section 46(6) which is again referring to Section 54 implying that refund of excess balance in cash ledger is to be taken as per provisions of Section 54. Please clarify. Venkatesh W (Posted On: 04 Jul, 2020)

Before we answer this question let us have a look at the related provisions. Section 54(1) reads as follows ?Any person claiming refund of any tax and interest, if any, paid on such tax orany other amount paid by him, may make an application before the expiry of two years fromthe relevant date in such form and manner as may be prescribed: Provided that a registered person, claiming refund of any balance in the electroniccash ledger in accordance with the provisions of sub-section (6) of section 49, may claimsuch refund in the return furnished under section 39 in such manner as may be prescribed.? Section 49(6) of CGST Act reads as follows ?The balance in the electronic cash ledger or electronic credit ledger after payment of tax, interest, penalty, fee or any other amount payable under this Act or the rules madethereunder may be refunded in accordance with the provisions of section 54.? This moves in a circular motion that proviso to Sec 54(1) refers to sec 49(6) and Sec 49(6) again refers to Section 54. Further Rule 61(4) also again refers to Section 54. So in our opinion for refund of excess balance in electronic cash ledger time limit for applying refund shall not be applicable.
The supplies of commodity ?y? to the market are channelled through a State Marketing Corporation which conducts an auction each day to arrive at the price. Gupta and Co. supplies commodity ?y? through the State Marketing Corporation. How will this supply of ?y? by Gupta and Co. be valued for paying tax? (Posted On: 04 Jul, 2020)

The State Marketing Corporation is an ?agent? in the meaning of the expression as defined in section 2(5), which includes an auctioneer. Therefore, the value of supply of ?y? will be determined in terms of rule 29 of CGST Rules relating to valuation. There is no open market for the first supply of commodity ?y?, as it is compulsorily supplied to the State Marketing Corporation. However, Gupta & Co. has the option of valuing the supply of ?y? at 90% of price of goods of like kind and quality sold by the State Marketing Corporation to its unrelated customers. If the value cannot be determined by this method, it needs to be determined on the basis of the cost plus 10% mark up as per rule 30 or on the basis of Best Judgement Method as per rule 31, in that order.
Rare Polymers Private Ltd. was the only Indian company making and selling a polymer ?x? to companies, who used this as a raw material. However, the international prices of ?x? dropped, and the companies began to import it rather than buying from Rare Polymers. The promoters then set up another company, which had a manufacturing unit that could use ?x?, with common directors and senior management for better integration of functionality. Rare Polymers began to supply ?x? to this related concern at low margins. The related concern was not eligible for full ITC. GST was paid on the price charged. Was the value adopted by Rare Polymers for supply of ?x? to its related concern, correct? (Posted On: 04 Jul, 2020)

The value was not correct. The invoice value could not be the basis of valuation for a supply made to a related person if the recipient is not eligible for full ITC. Under rule 28(a) of the CGST Rules relating to valuation, the open market value of polymer ?x? should be the value of the taxable supply of ?x? to the related concern. In this particular case, the open market value is likely to be the price of imported ?x? plus customs duties, which should be adopted for valuation after excluding the component of IGST on import as per the definition of open market value in explanation (a) to the CGST Rules relating to valuation.
What is the ITC entitlement of a newly registered person? (Posted On: 04 Jul, 2020)

A person applying for registration can take input tax credit of inputs held in stock and inputs contained in semi- finished or finished goods held in stock on the day immediately preceding the date of grant of registration. If the person was liable to take registration and he has applied for registration within thirty days from the date on which he became liable to registration, then ITC of inputs held in stock and inputs contained in semi- finished or finished goods held in stock on the day immediately preceding the date on which he became liable to pay tax can be taken.
Crunch Bakery Products Ltd sells biscuits and cakes through its dealers, to whom it charges the list price minus standard discount and pays GST accordingly. When goods remain unsold with the dealers, it offers additional discounts on the stock as an incentive to push the sales. Can this additional discount be reduced from the price at which the goods were sold and concomitant tax adjustments made? (Posted On: 03 Jul, 2020)

If the discounts were not known or agreed at the time of supply of goods to the dealers, then such discounts cannot be reduced from the price on which tax had been paid in terms of section 15(3). If the discount is pre-known then they can be reduced from the price and then effect of tax can be given.
I have entered into a development agreement with the landowner on 1.10.2019 in which 60% is of land owner and 40% of developer of the commercial property. On what portion will the developer pay GST ? (Posted On: 03 Jul, 2020)

Rule 31 applies in the instant case and the value of the supply is equal to the total amount received by the developer, which is equal to 40% of the market value of each plot. In case of joint development of plots, developer alone will be liable for his revenue share and in case where development is done by the land lord himself, he is liable for GST payment.
Dear Sir's Can I transferred the unutilised Cash Ledger Balances available from CGST & SGST HEAD ( Tax amount and Interest amount both) to IGST HEAD at a Time, which are wrongly paid previously. It is required to set off the Liability in IGST head. Please advice. (Posted On: 03 Jul, 2020)

PMT 09 enables a registered taxpayer to transfer any amount of tax, interest, penalty, etc. that is available in the electronic cash ledger, to the appropriate tax or cess head under IGST, CGST and SGST in the electronic cash ledger. Hence, if a taxpayer has wrongly paid CGST instead of SGST, he can now rectify the same using Form PMT-09 by reallocating the amount from the CGST head to the SGST head. The facility to use PMT-09 was made LIVE on the GST Portal on 21 April 2020. The option is available after the taxpayer logs in, under the electronic cash ledger tab. Thus, a taxpayer can now easily rectify wrongly paid taxes or other amounts.
Sir, We have dispatched finished goods @0.1%IGST on March-3rd 2020. Now the customer returned the goods along with raising Debit note ? is it right procedure in GST? now we have received the goods along with Debit note, now what we have to do as per GST please explain the procedure. sridhar (Posted On: 03 Jul, 2020)

If the goods sold are returned by the purchaser, then it is responsibility of the supplier to raise credit note. So we suggest that a credit note be issued at your end giving the effect of tax at the rate charged in the invoice. This credit note is then to be reported in GSTR-1 in the table CDNR/CDNUR as the case maybe and GSTR-3B as well by reducing from outward taxable supplies.
XYZ (Japan) will be selling the goods to PQR(India) i.e. Invoice of XYZ will be on PQR. PQR further issues an Invoice on ABC (India)). ABC will be further selling the goods / issuing the invoice on EFG (Sri Lanka). However, the goods will be physically moved from XYZ(Japan) to EFG (Sri Lanka). Will this be treated as an export for PQR and whether PQR had got any GST liability on this? Kaustubh Karandikar (Posted On: 02 Jul, 2020)

Paragraph 7 to the Schedule-III to the CGST Act 2017; amended by CGST (Amendment) Act 2018, is reproduced states that ?Supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India?. In the above mentioned query the same situation is mentioned. So it shall not be treated as export. But an adverse Ruling has been issued by Gujarat AAR in the case of Sterlite technologies ltd., wherein it was held that GST is payable on goods sold to a customer located outside India, where goods are shipped directly from the vendor?s premises (located outside India) to the customer?s premises.
Sir Can I File Nil GSTR-1 by way of SMS as well. (Posted On: 02 Jul, 2020)

Notification No. 58/2020-Central Tax dated 01.07.2020 has been issued wherein the GSTR-1 can also be filed by way of SMS.
What is the procedure to file nil GSTR-3B by way of SMS? (Posted On: 02 Jul, 2020)

Notification No. 44/2020- Central Tax dated 08.06.2020 was issued giving effect to the provisions of filing nil GSTR-3B by way of SMS without logging on into the portal. The procedure prescribed by Council is as follows a. To initiate filing Send an SMS as NIL < Space > 3B < Space > GSTIN < Space > Tax period Ex. NIL 3B 27XXXXXXXXXXXZC 0502020. A code will be received in reply to this SMS which shall be valid for 30 minutes. b. To confirm nil filing send SMS as CNF < Space > 3B < Space > Code Ex. CNF 3B 123456. A confirmation of filed GSTR-3B return by SMS is received. The SMS are to be sent to 14409.
I am a registered job worker, and want to bill an unregistered client. What rate shall be applicable? (Posted On: 02 Jul, 2020)

As per Notification No. 20/2019-Central Tax rate dated 30.09.201918% rate of tax shall be applicable a registered job worker provides job work service to unregistered person.
How much late fees is payable if the return for the month of April 2020 is filed in June 2020 month. (Posted On: 02 Jul, 2020)

Notification No. 57/2020-Central Tax was issued on 30th June 2020 wherein conditional waiver of Late fees was made for the period from July 2017 to July 2020. The conditions being specified are as follows a. The returns shall be failed by 30th September 2020. b. The waiver of late fees is for the amount in excess of Rs. 250/- in CGST and Rs. 250/- in SGST. This means that the maximum cap of late fees is Rs. 500/- together. Further if nil return is filed for the periods specified above then no late fees shall be applicable.
If amend the sale invoice in GSTR-1, shall we show the only amendment amount in GSTR 3B, kindly clarify. for example Sale Invoice basic amount GST@18% Total amount Remarks 100,000.00 18,000.00 118,000.00 Uploaded in May-20 150,000.00 27,000.00 177,000.00 Amended in Jun-20 50,000.00 9,000.00 59,000.00 Balance amount Shall we show the Jun-20 3B filing? One more doubt GST payable link between GSTR 1 - GSTR 3B Input = GST Payable amount is it right or not. (Posted On: 02 Jul, 2020)

Any amendment which reduces or increases taxable value or GST payment has to be given effect in GSTR 3B. The amendment made in June 2020 has lead to payment of tax due to escalated figure, therefore, balance amount is to be paid in GSTR 3B of June 2020 month. You are right in analysing that GSTR 1 output minus GSTR 3B input is equivalent to the GST payable for any period. The effect of input reversed during a period should also be taken into consideration.
A firm gives an interest-free credit period of 30 days for payment by the customer. Its customer ABC paid for the supply 32 days after the supply of service. The supplier waived the interest payable for delay of two days. The Department wants to add interest for two days as per contract. Should notional interest be added to the taxable value? (Posted On: 01 Jul, 2020)

This is a supply that is valued as per transaction value under section 15(1) as the price is the sole consideration for the supply and the supply is made to unrelated person. The concept of transaction value has been expanded to include certain elements like interest which are actually payable. Once waived, the interest is not payable and is therefore, not to be added to transaction value.
XYZ Ltd. gets an order for supply of processed food from a customer. The customer wants the consignment tested for gluten or specified chemical residues. XYZ Ltd. does the testing and charges a testing fee for the same from the customer. It is being argued that such testing fees should not form part of the consideration for the sale as it is a separate activity. Is this correct in the light of section 15? (Posted On: 01 Jul, 2020)

Section 15(2) mandates the addition of certain elements to transaction value to arrive at taxable value. Clause (c) of section 15(2) specifies that amount charged for anything done by the supplier in respect of the supply at the time of or before delivery of goods or supply of services shall be included in taxable value. Since XYZ Ltd. does the testing before the delivery of goods, the charges therefore will be included in the taxable value. Therefore, XYZ Ltd.?s argument is not correct. The testing fee should be added to the price to arrive at taxable value of the consignment.
The time of liability to pay GST is independent of the time of supply of goods/ services. Is my point of thinking correct? (Posted On: 01 Jul, 2020)

No sir it is not. Liability to pay arises at the time of supply of goods as explained in Section 12 and at the time of supply of services as explained in Section 13 of CGST Act. The time is generally the earliest of one of the three events, namely receiving payment, issuance of invoice or completion of supply. Different situations envisaged and different tax points have been explained in the aforesaid sections.
Investigation shows that 150 cartons of ceramic capacitors were despatched on 2nd August but no invoice was made and the cartons were not entered in the accounts. There was no evidence of receipt of payment. What is the time of supply of the 150 cartons? (Posted On: 01 Jul, 2020)

As per Notification No. 66/2017 CT dated 15.11.2017, a registered person (excluding composition supplier) has to pay GST on the outward supply of goods at the time of supply as specified in section 12(2)(a) i.e., date of issue of invoice or the last date on which invoice ought to have been issued in terms of section 31. In this case since the invoice has not been issued, the time of supply will be the last date on which the invoice is required to be issued. The invoice for supply of goods must be issued on or before the despatch of goods i.e., on 2nd August. Therefore, time of supply of the goods will be 2nd August, the date when the invoice should have been issued.
I prepared tax invoice and filled Part A of E way bill. But the vehicle in which goods were to be uploaded came after seven to Eight days. What is to be done now? Can we update only Part-B or are we required to prepare a new E way Bill. (Posted On: 01 Jul, 2020)

Explanation 2 to Rule 138(3) reads as follows ?The e-way bill shall not be valid for movement of goods by road unless the information in Part-B of FORM GST EWB-01 has been furnished except in the case of movements covered under the third proviso to sub-rule (3) and the proviso to sub-rule (5).? The validity of E-way bill shall start only when Part-B is being updated. So there is no requirement to fill part b of e way bill.
Raju Pvt Ltd. receives the order and advance payment on 5th January for carrying out an architectural design job. It delivers the designs on 23rd April. By oversight, no invoice is issued at that time, and it is issued much later, after the expiry of prescribed period for issue of invoice. When is the time of supply of service? (Posted On: 30 Jun, 2020)

Since the invoice has not been issued within the prescribed time period, time of supply of service will be the earlier of the following two dates in terms of section 13(2)(b): ? Date of provision of service ? Date of receipt of payment The payment was received on 5th January and the service was provided on 23rd April. Therefore, the date of payment, i.e., 5th January is the time of supply of the service in this case.
Is GTA required to be registered under Road Carriage Act? (Posted On: 30 Jun, 2020)

GST laws define GTA in notification no. 12/2017-Central Tax (Rate) dated 28.06.2017), which states that, ?goods transport agency means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called?. Thus, the transporter must issue a consignment note in order for a service provider to be considered a GTA. If the transporter does not issue a consignment note, the service provider will not come within the ambit of GTA.
Transporter who charges 5% GST, Can ITC be availed? (Posted On: 30 Jun, 2020)

Transporter has three options i) 5% without ITC, ii) 12% with ITC iii) recipient pays tax under Reverse charge basis. As per the query asked if the transporter charges 5 % GST, credit on input services and goods can?t be availed by the transporter but credit of such transportation services can be availed by the recipient.
Assessee's FY 18-19 Total receipt is 22 lacs. Therefore, it required registration in FY 19-20 after completion of year. FY 19-20 total receipt is less than 40lac (govt. Extend threshold limit from 20lac to 40 lac) As per govt notification, the limit has been extended from 20 lac to 40 lac in fy19-20. Whether assessee is required GST registration In FY 20-21? (Posted On: 30 Jun, 2020)

Vide Notification No. 10/2019-Central Tax dated 7th March, 2019, the threshold limit for registration (For those engaged in exclusive supply of goods has been enhanced to Rs. 40 lacs w.e.f. 1.4.2019. ?Except persons engaged in making intra-State supplies in the States of Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Puducherry, Sikkim, Telangana, Tripura, Uttarakhand ? Except persons required to take compulsory registration under section 24 ?Except suppliers of Ice cream and other edible ice, whether or not containing cocoa; Pan masala; Tobacco and manufactured tobacco substitutes. The threshold for registration for service providers would continue to be Rs 20 lakhs and in case of Special category States Rs 10 lakhs. So if you are purely transacting in goods, you are not required to take GST registration.
XYZ Ltd. (Maharashtra) will be supplying the goods to Nepal by following this procedure:1) Mumbai ? Patna by Blue Dart 2) From Patna Blue Dart Hub, Material will be transported by Bus to Raxol Border. 3) At RaxolBorder ? XYZ will get the customs stamp on invoice. 4)The material will be collected at the Nepal Border by the Consignee. Kindly guide how to raise e way bill and tax invoice by XYZ in this situation (Posted On: 30 Jun, 2020)

You are required to raise e way bill under multi modal transhipment option. Whenever the mode of transport is changed, update the e way bill accordingly. Moreover, e way bill will be raised from Maharashtra to Nepal. Further invoice is to be raised by XYZ according to rule 46 of CGST rules. In case of Export of goods or services, the invoice shall carry an endorsement ―SUPPLY MEANT FOR EXPORT/SUPPLY TO SEZ UNIT OR SEZ DEVELOPER FOR AUTHORISED OPERATIONS ON PAYMENT OF INTEGRATED TAX‖ or ―SUPPLY MEANT FOR EXPORT/SUPPLY TO SEZ UNIT OR SEZ DEVELOPER FOR AUTHORISED OPERATIONS UNDER BOND OR LETTER OF UNDERTAKING WITHOUT PAYMENT OF INTEGRATED TAX. And shall also contain the following details (i) name and address of the recipient; (ii) address of delivery; and (iii) name of the country of destination.
Sir, I have a query regarding Customs debonding. Back in 2018, while executing debonding procedure of a unit located in an SEZ (unit had closed operations), our employee inadvertantly paid the debonding duty in GST portal (instead of TR-6 challan) and surprisingly the Customs officer had also granted the NOC based on such GST challan. However in 2020, while proceeding for cancellation of GST registration of such unit, it was observed that this amount was lying in the GST Electronic Cash ledger, which is when this mistake was identified. On contacting the concerned customs officer, we were informed that such duty paid on GST portal is invalid and fresh payment needs to be made with interest, under a TR-6 challan. Would really appreciate if you could shed light on what procedure we should follow to close this issue by paying the duty with interest. Whether any other forms/returns need to be filed, since debonding duty can be paid only against relevant invoices (which was already done earlier, though payment made in GST portal). Can we make debonding duty payment once again against those same invoices? Sanjay (Posted On: 30 Jun, 2020)
XYZ Ltd is engaged in the services of a transporter for road transport of a consignment on 17th June and made advance payment for the transport on the same date, i.e., 17th June. However, the consignment could not be sent immediately on account of a strike in the factory, and instead was sent on 20th July. Invoice was received from the transporter on 22nd July. What is the time of supply of the transporter?s service? (Posted On: 29 Jun, 2020)

Time of supply of service taxable under reverse charge is the earlier of the following two dates in terms of section 13(3): ? Date of payment ? 61st day from the date of issue of invoice In this case, the date of payment precedes 61st day from the date of issue of invoice by the supplier of service. Hence, the date of payment, that is 17th June, will be treated as the time of supply of service [Section 13(3)(a)].
My turnover is below limit but I have paid legal charge Rs 15000/. Whether I am liable to get registered myself? (Posted On: 29 Jun, 2020)

Section 24 of CGST act requires compulsory registration in certain cases in which one of the case is ?(iii) persons who are required to pay tax under Reverse Charge? irrespective of the turnover. As per the query above yes sir you are required to get yourself registered.
Sir, a new building is being constructed for our new business. Whether we can avail credit on the cement, iron rods and other material used in the construction of building? (Posted On: 29 Jun, 2020)

As per 17(5)(d) of the CGST Act, 2017, goods or services or both received by a taxable person for construction of an immovable property (other than plant and machinery) on his own account including such goods or services or both are used in course of furtherance of business are blocked credit but explanation to this clause states that if the expenses are being capitalised then ITC cannot be claimed as it is blocked under section 17(5), but credit in relation to repair & maintenance can be claimed.
Supplier sales goods to purchaser on FOR basis and pay freight to transporter. what will be the impact of RCM in the hand of supplier (Posted On: 29 Jun, 2020)

Supplier is responsible for payment of tax under RCM basis and can avail credit of tax paid.
Will RCM be applicable or not on Rent paid to URD? (Posted On: 29 Jun, 2020)

RCM is leviable under sections 9(3) and 9(4) of CGST Act 2017. As per section 9(3) is applicable with respect to certain services notified by the government in Notification No. 13/2017-Central Tax Rate dated 28.06.2017. And in this notification, Rent is not covered. Further Section 9(4) deals with payment on RCM if there is purchase of Rs. 5,000/- and above from Unregistered person. But this clause has been deferred from 13.10.2017. So considering the above provisions RCM is not applicable on Rent paid to unregistered Person.
I bought a set of modular furniture from a retail store. Invoice was issued to me and I made the payment. The furniture is to be delivered to me later in the week depending upon the availability of technician to assemble and install it. The next day the rate of tax applicable to modular furniture is revised upward, and the store sends me a supplementary invoice with the delivery note accompanying the furniture to collect the differential amount of tax. Is this correct on store?s part? (Posted On: 27 Jun, 2020)

No, the store is not correct in issuing supplementary invoice with revised rate of tax. The revised rate of tax is not applicable to the transaction, as the issuance of invoice as well as receipt of payment occurred before the supply. Therefore, in terms of section 14(b)(ii), the time of supply is earlier of the two events namely, issuance of invoice or receipt of payment, both of which are before the change in rate of tax, and thus, the old rate of tax remains applicable.
Sir my turnover is less than 5 crore rupees and I am registered in the state of Rajasthan what is the rate of interest applicable if I file my return GSTR-3B for the month of March 2020 on 15.07.2020 (Posted On: 27 Jun, 2020)

Government has provided relaxations by waving late fees and reducing interest rates. Notification No. 51/2020-Central Tax dated 24.06.2020 was issued specifying the interest rates. As per the query stated by you, for the month of March no interest is applicable if return is filed before 05.07.2020 and 9% interest shall be charged if return is filed till 30.09.2020. This benefit of reduced rate of interest is applicable only when the return is filed before 30.09.2020. If you file the return on 15.07.2020, then interest shall not be applicable till 05.07.2020 but later on 9% shall be applicable for 10 days.
What is the due date for filing of GSTR-1 for the month of March 2020? (Posted On: 27 Jun, 2020)

As per Notification No. 53/2020-Central Tax dated 24.06.2020, the due date for monthly filing of March 2020 is 10th July 2020 and quarterly filing of January to March 2020 is 17th July 2020.
XYZ is located in Rajasthan and receives order from PQR registered in the state of Punjab with an instruction to ship the order to ABC, who is also registered in Punjab. In this case what shall be the place of supply? (Posted On: 27 Jun, 2020)

The supply between XYZ and PQR is a bill to ship to supply transaction. In case of such supply, it is deemed that the said third person has received the goods and the place of supply of such goods is the principal place of business of such person[Section 10(1)(b) of the IGST Act, 2017].Since the location of supplier and the place of supply are in two different States, the supply is an inter-State supply in terms of section 7 of the IGST Act, 2017, liable to IGST. There is another transaction between PQR and ABC, in this case the place of supply will be location of the goods at the time at which the movement of goods terminates for delivery to the recipient Section 10(1)(a) of the IGST Act, 2017.Since the location of supplier and the place of supply are in the same State, the supply is an intra-State supply in terms of section 8 of the IGST Act, 2017, liable to CGST and SGST.
While filing GSTR-9 of 2018-19, I was unable to see the auto populated figures of 2A as shown in Table 8A of GSTR-9. What shall I do? (Posted On: 27 Jun, 2020)

In such a case we suggest that a grievance shall be filed on the portal regarding this issue faced. The grievance should be attached with the screenshot of GSTR-9.
XYZ Ltd. (Maharashtra) will be supplying the goods to Nepal by following this procedure:1) Mumbai ? Patna by Blue Dart 2) From Patna Blue Dart Hub, Material will be transported by Bus to Raxol Border. 3)At Raxol Border ? XYZ will get the customs stamp on invoice. 4)The material will be collected at the Nepal Border by the Consignee. Kindly guide how to raise e ? way bill and tax invoice by XYZ in this situation Kaustubh Karandikar (Posted On: 26 Jun, 2020)
Mr. Z, a supplier registered in Hyderabad (Telangana), procures goods from China and directly supplies the same to a customer in US. whether the said activity of supply of goods by Mr. Z to customer in US is taxable under GST. (Posted On: 26 Jun, 2020)

Schedule III to the CGST Act specifies transactions/ activities which shall be neither treated as supply of goods nor supply of services. A new activity has been added in the said Schedule III vide the CGST (Amendment) Act, 2018 namely, supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India. Thus, it seeks to exclude from the tax net such transactions which involve movement of goods, caused by a registered person, from one non-taxable territory to another non-taxable territory. Therefore, in view of the above-mentioned provisions, the said activity is not a supply. Hence, it is not leviable to GST since ?supply? is the taxable event for chargeability of GST. But advance ruling passed in the case of Sterlite Industries by Gujarat AAR is against the provisions mentioned above. It was pronounced that IGST is payable on goods procured from overseas customer by an overseas vendor of an Indian firm.
A company XYZ Ltd. Registered in Mumbai has recruited ABC Ltd., an event management company of Gujarat, for organising the party for the launch of its new product at Bangalore. What shall be the place of supply. Will it be different if the product launch party is organised at Dubai? (Posted On: 26 Jun, 2020)

Section 12(7)(a)(i) of IGST Act, 2017 stipulates that when service by way of organization of an event is provided to a registered person, place of supply is the location of recipient. Since, in the given case, the product launch party at Bangalore is organized for XYZ Ltd. (registered in Mumbai), place of supply is the location of XYZ Ltd. i.e., Mumbai. In case the product launch party is organised at Dubai, the answer will remain the same, i.e. the place of supply is the location of XYZ Ltd. ? Mumbai, as per Section 12(7)(b)(ii) of IGST Act, 2017
XYZ Pvt. Ltd. are registered with MSME and being an MSME, are getting a subsidy from the govt. which gets directly credited to their bank account. Is XYZ liable to pay GST on the subsidy received? Kaustubh Karandikar (Posted On: 26 Jun, 2020)

As per clause(e) of Section 15 of the CGST Act, 2017, Value of Supply shall include subsidies directly linked to the price excluding subsidies provided by the central government and state government. Therefore, you are not liable to pay any GST on the subsidy received from the government.
Can I avail the credit of Rent ? a ? cab? (Posted On: 24 Jun, 2020)

Ans. As per Section 17(5)(b)(iii) says that the credit shall be available with respect to Rent-a-cab only in two situations. One being that it is obligatory for an employer to provide to its employees under any law and the other being that same category of service is being provided for making outward taxable service. In this case if you can prove that the service of Rent a cab is obligatory as per any provision of law, then credit can be availed.
A person from Mumbai goes to Kullu-Manali and takes some services from ICICI Bank in Manali. What is the place of supply? (Posted On: 24 Jun, 2020)

Ans. If the service is not linked to the account of person, place of supply will be Kullu i.e., the location of the supplier of services. However, if the service is linked to the account of the person, the place of supply will be Mumbai, the location of recipient on the records of the supplier. [Section 12(12) of IGST Act, 2017]
I am selling toothpaste and giving soap free along with it. What shall be the rate charged? (Posted On: 24 Jun, 2020)

Ans. In order to classify the supply as composite, the products should be naturally bundled in the ordinary course of business. but in your case, toothpaste along with soap do not pass the criteria of naturally bundled. Therefore, this shall be a mixed supply and the rate to be charged shall be the highest rate applicable out of the two products.
Sir I own a EOU unit and have manufactured goods 5 years ago. But due to some reasons I couldn?t export them. Now I am doing domestic clearance of the same by charging IGST. Moreover, I am also required to reverse the basic duty on inputs used in manufacturing. As I don?t remember the inputs used can I use SION norm? (Posted On: 24 Jun, 2020)

Ans. Yes sir you can consider the SION for reversal of duty. Although there is no clarification in Foreign Trade policy in this regard but Government has prescribed the Standard Input output ratio then these can be followed in our opinion.
We are 100% EOU and opting out of the EOU scheme. We have to pay the duty on depreciated value of capital goods. To avoid of such tax, we intend to opt for EPCG schemce. For EPCG scheme, export obligation is to be fulfilled over and above the average export of last there years. Will the average clause be applicable in this case also? (Posted On: 24 Jun, 2020)

Ans. No sir, if you are stand alone EOU then Average clause will not be applicable as per para 5.7(c ) of Foreign Trade polcy 2015-2020.
the Central Government, has specified that persons making inter-State supplies of taxable services and having an aggregate turnover on all India basis, not exceeding INR 20 lakh in a financial year are category of persons exempted from obtaining registration under the said Act. Please confirm the same? Rohit (Posted On: 24 Jun, 2020)

As per Section 24 of CGST Act, Compulsory registration is required to be taken by the persons making inter-state taxable supply irrespective of the turnover limit. The person is not exempted from obtaining registration.
XYZ Ltd. Are registered with GST and are in the business of manufacture of Paint. They will be buying other items such as putty/texture etc from outside market. XYZ had received a contract of painting of residential / commercial buildings. XYZ will be employing an outside painting contractor for the said painting. XYZ will be invoicing to the B2B / B2C as the case may be for this painting work. For invoicing in case of both B2B and B2C, SAC ? 9954 (Works Contract Service ? Painting Service) Rate ? 18%. Is the above correct? In case of B2C contract, can XYZ issue a consolidated invoice at the month end or do they need to raise individual invoices? In either case, can XYZ create a dummy customer by name of ?Retail Customer? and invoice to it as individuals have no traceability whatsoever, in terms of GST. Kaustubh Karandikar (Posted On: 23 Jun, 2020)

The provided services will be taxable under the head ?Painting services? falling under SAC 995473 attracting GST @ 18%. In case of B2C contract individual invoices are to be raised. Consolidated invoice can be raised only in the case of RCM not under forward charge mechanism. Further as per Rule 46 which prescribes the format of Tax invoice; requires the mentioning of name and address of the recipient. The relevant portion is being reproduced as follows. ?(d) name, address and Goods and Services Tax Identification Number or Unique Identity Number, if registered, of the recipient; (e) name and address of the recipient and the address of delivery, along with the name of the State and its code, if such recipient is un-registered and where the value of the taxable supply is fifty thousand rupees or more; (f) name and address of the recipient and the address of delivery, along with the name of the State and its code, if such recipient is un-registered and where the value of the taxable supply is less than fifty thousand rupees and the recipient requests that such details be recorded in the tax invoice?
Whether petrol dealer need to file annual return under GST. My client is running petrol pump and selling lubricant also. (Posted On: 23 Jun, 2020)

Aggregate turnover? means the Aggregate value of all taxable supplies, exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number. ?Exempt supply? means supply of any goods or services or both which attracts nil rate of tax or which may be wholly Exempt from tax under section 11, or under section 6 of the Integrated Goods and Services Tax Act, and includes non-taxable supply (Petrol and diesel). In your case, if turnover (including Petrol and diesel) is more than 2 crore upto 5 crores, taxpayer is required to file GSTR-9 only. If exceeding 5 crores, then have to file both GSTR 9 and GSTR 9C.
A person, liable to pay GST, interest and penalty dies. Which person liable to pay the GST, interest and penalty due from such person under GST law determined after his death if the business carried on by such person is continued after his death by his legal representative. (Posted On: 23 Jun, 2020)

Section 93(1) of CGST Act 2017 reads as - ?Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016, where a person, liable to pay tax, interest or penalty under this Act, dies, then if a business carried on by the person is continued after his death by his legal representative or any other person, such legal representative or other person, shall be liable to pay tax, interest or penalty due from such person under this Act, whether such tax, interest or penalty has been determined before his death but has remained unpaid or is determined after his death.? As per Circular No.96/15/2019 GST dated 28.03.2019It is also clarified that the transferee/ successor shall be liable to pay any tax, interest or any penalty due from the transferor in cases of transfer of business due to death of sole proprietor.
An unregistered person in Delhi, who has an aggregate turnover of Rs. 16 lakh sells mobile phones to a person registered under GST in Uttar Pradesh. Is he required to take registration? (Posted On: 23 Jun, 2020)

As per Section 24 of CGST Act, Compulsory registration is required to be taken by the persons making inter-state taxable supply irrespective of the turnover limit. So in this case, the person located in Delhi is required to take registration.
Whether a CGST/SGST authority can revise an order passed by his subordinates? (Posted On: 23 Jun, 2020)

Section 2(99) defines ?Revisional Authority? as an authority appointed or authorised under the CGST Act for revision of decision or orders referred to in section 108. Section 108 of the Act authorizes such ?revisional authority? to call for and examine any order passed by his subordinates and in case he considers the order of the lower authority to be erroneous in so far as it is prejudicial to revenue and is illegal or improper or has not taken into account certain material facts, whether available at the time of issuance of the said order or not or in consequence of an observation by the Comptroller and Auditor General of India, he may, if necessary, can revise the order after giving opportunity of being heard to the noticee. Along with order under section 108(1), Revisional Authority will also issue a summary of order clearly indicating final amount of demand confirmed. The ?revisional authority? can also stay the operation of any order passed by his subordinates pending such revision. The ?revisional authority? shall not revise any order if- (a) the order has been subject to an appeal under section 107 or under section 112 or under section 117 or under section 118; or (b) the period specified under section 107(2) has not yet expired or more than three years have expired after the passing of the decision or order sought to be revised. (c) the order has already been taken up for revision under this section at any earlier stage. (d) the order is a revisional order
Salary paid to partners. Is it liable to GST? (Posted On: 23 Jun, 2020)

Salary received by partners is not liable to tax as Salary is out of purview of GST Salary because as per Schedule III specified in Section 7(2) of CGST Act, Services by an employee to the employer in the course of or in relation to his employment are outside the purview of GST. This provision is further being backed in AAR ruling given in case by M/s Anil Kumar Agarwal by AAR Karnataka.
MR. XYZ (Proprietor) is registered with GST. His Son MR. PQR is starting a new business with a different name with separate entity. Is PQR required to obtain GST Registration from the day one since XYZ and PQR are related? Kaustubh Karandikar (Posted On: 23 Jun, 2020)

Section 24 of CGST Act 2017 specifies the persons who are required to obtain compulsory registration under the Act. Even though they are related, so PQR is not required to obtain registration if below threshold limit.
Can the AAR & AAAR order for rectification of mistakes in the ruling? (Posted On: 22 Jun, 2020)

Yes, AAR and AAAR have power to amend their order to rectify any mistake apparent from the record within a period of six months from the date of the order. Such mistake may be noticed by the authority on its own accord or may be brought to its notice by the applicant or the concerned or the jurisdictional CGST/SGST officer. If a rectification has the effect of enhancing the tax liability or reducing the quantum of input tax credit, the applicant or the appellant must be heard before the order is passed. (Section 102)
How to track Eway bills generated against our GSTN by third party? (Posted On: 22 Jun, 2020)

Following are the Steps to Generate a report in respect of ?Eway Bills Generated by others? against your GSTN by the other party for a particular date: ? Login with your User ID and Password on https://ewaybill.nic.in ? On the Left side in the blue panel Click on Reports > Other EWB Reports >Generated by others. ? Select the Date. ? Click on Go, and it will generate a report.
In case of a domestic supply, the place of supply in relation to immovable property is the location of immovable property. Suppose a road is constructed from Delhi to Mumbai covering multiple states. What will be the place of supply of construction services? (Posted On: 22 Jun, 2020)

Where the immovable property is located in more than one State, the supply of service is treated as made in each of the States in proportion to the value for services separately collected or determined, in terms of the contract or agreement entered into in this regard or, in the absence of such contract or agreement, on such other reasonable basis as may be prescribed [Section 12(3) of IGST ACT, 2017].
In case of a domestic supply, the place of supply in relation to immovable property is the location of immovable property. Suppose a road is constructed from Delhi to Mumbai covering multiple states. What will be the place of supply of construction services? (Posted On: 22 Jun, 2020)

Where the immovable property is located in more than one State, the supply of service is treated as made in each of the States in proportion to the value for services separately collected or determined, in terms of the contract or agreement entered into in this regard or, in the absence of such contract or agreement, on such other reasonable basis as may be prescribed [Section 12(3) of IGST ACT, 2017].
We have registered offices in Punjab and Haryana and supplies goods in neighbouring States. Whether our firm is eligible for composition levy provided our turnover in preceding year does not exceed Rs. 1.5 crore: (Posted On: 22 Jun, 2020)

Since supplier of inter-State outward supplies of goods is not eligible for composition levy, hence you are not eligible for composition levy.
I am a Goods Transport Agency engaged in transportation of goods by road. As per the general business practice, we also provide intermediary and ancillary services like loading/unloading, packing/unpacking, transhipment and temporary warehousing, in relation to transportation of goods by road. Whether such services are to be treated as part of the GTA service, being a composite supply, or as separate supplies. (Posted On: 22 Jun, 2020)

Composite supply means a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services or both, or any combination thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply [Section 2(30) of the CGST Act]. The GTA provides various intermediary and ancillary services, such as, loading/unloading, packing/unpacking, transhipment and temporary warehousing, which are provided in the course of transport of goods by road. These services are not provided as independent services but as ancillary to the principal service, namely, transportation of goods by road. The invoice issued by the GTA for providing the said service includes the value of intermediary and ancillary services. In view of this, if any intermediary and ancillary service is provided in relation to transportation of goods by road, and charges, if any, for such services are included in the invoice issued by the GTA, such service would form part of the GTA service, being a composite supply, and would not be treated as a separate supply. However, if such incidental services are provided as separate services and charged separately, whether in the same invoice or separate invoices, they shall be treated as separate supplies.
purchased goods from Y and instead of making actual payment to Y against this purchase, the amount was adjusted against purchases made by Y from X. Can X claim Input Tax credit against purchases made from Y since one of the conditions for claiming ITC is payment should be made to the supplier within 6 months from the date of invoice? Please guide. Kaustubh Karandikar (Posted On: 22 Jun, 2020)

As per Section 16(2) of CGST Act 2017, in order to claim credit, the following conditions are to be satisfied cumulatively a. Possession of tax invoice b. Receipt of goods or services c. He has paid the tax to the government either by way of utilisation of credit or by way of credit. d. Return has been furnished under section 39. If all the above conditions are satisfied then we are eligible to claim credit and the condition mentioned in the query that the payment to the supplier shall be made within 180 days is second proviso to this section. Furthermore, West Bengal AAR in the case of Senco Cold Limited has stated that ?Applicant can pay the consideration for inward supplies by way of setting off book debt?. So payment made to X instead of Y is also a book adjustment. So in this case credit can be claimed by X if all the above conditions are satisfied.
Hi, In case of cheque bounce bank charges as 500 from customer with 18% GST . my question is can bank charge GST from customer or should bank give from its own pocket that is rs 90 GST+rs 410 Arvind Nagpal (Posted On: 21 Jun, 2020)

Bank can charge GST on this as it charges for bouncing of cheque which falls under ?agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act;? specified in Schedule II of the act.
CAN I GET ITC ON "COMMERCIAL TRAINING AND COACHING SERVICES" HSN - 999293, THANK YOU PANKAJ NANDWANI (Posted On: 20 Jun, 2020)

Yes sir credit can be claimed.
Can you please specify the orders against which no appeals can be filed under section 121. (Posted On: 20 Jun, 2020)

As per section 121 of the CGST Act, 2017, no appeal shall lie against any decision taken or order passed by a CGST officer if such decision taken or order passed relates to any one or more of the following matters, namely:? (a) an order of the Commissioner or other authority empowered to direct transfer of proceedings from one officer to another officer; or (b) an order pertaining to the seizure or retention of books of account, register and other documents; or (c) an order sanctioning prosecution under the CGST Act, 2017; or (d) an order passed under section 80 of the CGST Act, 2017 (payment of tax in instalments).
We are paying salary to director and TDS under income tax act is being deducted under section 192. Are we liable to pay tax under RCM. (Posted On: 20 Jun, 2020)

Recently circular No. 140/10/2020-GST dated 10.06.2020 was issued wherein it was clarified that if TDS is deducted under section 192 then tax under Reverse charge is not required to be paid. So in your case as TDS is deducted under Section 192 then RCM on director?s remuneration is no to be paid. For further understanding refer to ?GST Hindi Update Clarification on Director Remuneration 64H-2020/21? published on our website www.capradeepjain.com
Will credit of rented building insurance be available (Posted On: 20 Jun, 2020)

In our opinion, insurance shall be available on rented building insurance as it is used in the furtherance of business and not blocked under Section 17(5) of CGST Act 2017. The only condition is that it should be paid by tenant only and his name, address and GST number should appear in the policy.
Sir I am providing canteen services to employees without consideration. Is GST to be charged on this. (Posted On: 20 Jun, 2020)

If providing food is included in the terms of employment then GST is not to be charged. But if it is not included in the terms of employment then it is liable to GST as the employer employee falls under related party transaction. Even without consideration also, it will be termed as ?supply? and GST is payable.
I am sending goods from one unit to another which is located within 50 km. Is E way bill required to be generated? (Posted On: 20 Jun, 2020)

Yes E way bill is required to be generated, there is no exemption from generating the E way bill for movement of goods from one factory to another. If it is going by vehicle then e-way bill is to be generated.
A Company receives the order and advance payment on 5th January for carrying out an architectural design job. It delivers the designs on 23rd April. By oversight, no invoice is issued at that time, and it is issued much later, after the expiry of prescribed period for issue of invoice. When is the time of supply of service? (Posted On: 19 Jun, 2020)

Since the invoice has not been issued within the prescribed time period, time of supply of service will be the earlier of the following two dates in terms of section 13(2)(b): ? Date of provision of service ? Date of receipt of payment The payment was received on 5th January and the service was provided on 23rd April. Therefore, the date of payment, i.e., 5th January is the time of supply of the service in this case.
On May 4, a German company informs via mail the cost of technical services provided to the company located in India. These companies are associated enterprises as per Section 92A of the Income Tax Act, 1961. The Indian company on June 15 transfers the amount to the account of that company. Then what shall be the time of supply. (Posted On: 19 Jun, 2020)

As there is no prior entry of the amount in the books of account of German Company, June 15 will be time of supply, being the date of payment in terms of second proviso to section 13(3) of the CGST Act.
In case of a domestic supply, what will be the place of supply of passenger transportation service, if a person travels from Mumbai to Delhi and back to Mumbai? (Posted On: 19 Jun, 2020)

If the person is registered, the place of supply will be the location of recipient. If the person is not registered, the place of supply for the forward journey from Mumbai to Delhi will be Mumbai, the place where he embarks [Section 12(9) of the IGST Act]. However, for the return journey, the place of supply will be Delhi as the return journey has to be treated as separate journey [Explanation to section 12(9)].
In case of a domestic supply, what would be the place of supply of services provided by an event management company for organizing a sporting event for a Sports Federation which is held in multiple States? (Posted On: 19 Jun, 2020)

In case of an event, if the recipient of service is registered, the place of supply of services for organizing the event is the location of such person. However, if the recipient is not registered, the place of supply is the place where event is held. Since the event is being held in multiple states and a consolidated amount is charged for such services, the place of supply will be taken as being in each state in proportion to the value of services so provided in each state determined in terms of the contract or agreement entered into in this regard.
Whether duty paid under protest and subsequently refund is to be considered as pre-deposit and entitled for interest from date amount is paid under protest.Please mention case law in this favour. Jai Parkash gupta (Posted On: 19 Jun, 2020)

In the following judgments, the Hon?ble High Court and different benches of Hon?ble CESTAT held that whenever any amount had been deposited during investigation,it shall always be treated as deposited under protest. ? CCE Vs Pricol Ltd. & Ors. MANU/TN/1261/2015 ? CCE,Lucknow VS Everready Industries ltd MANU/UP/4095/2017 ? Gujrat Engineering Works Vs Commissioner of Central Excise MANU/CS/0121/2013 ? Shree Ram Foods Industries MANU/GJ/0359/2002 ? Ebiz Com P Ltd Vs. CCE MANU/UP/3167/2016 Allahabad High Court Decision ? CCE Vs Pricol Ltd MANU/TN/1261/2015 Madras High Court
What is the place of supply where the goods (In case of a domestic supply) or services (In case of a domestic & International) supply, are supplied on board a conveyance, such as a vessel, an aircraft, a train or a motor vehicle? (Posted On: 18 Jun, 2020)

As per section 10(1) (e), in respect of goods, the place of supply is the location at which such goods are taken on board. However, in respect of services, the place of supply is the location of the first scheduled point of departure of that conveyance for the journey in terms of sections 12(10) and 13(11).
To whom will the Advance Ruling be applicable? (Posted On: 18 Jun, 2020)

An advance ruling pronounced by AAR or AAAR shall be binding only on the applicant and on the concerned officer or the jurisdictional officer in respect of the applicant. This clearly means that an advance ruling is not applicable to other taxable persons in the State. It is only limited to the person who has applied for an advance ruling.
If XYZ is being issued a summon to appear before the central tax officer to produce the books of accounts in an inquiry conducted. What if he fails to appear before the Central Tax officer? (Posted On: 18 Jun, 2020)

Section 122(3) (d) of the CGST Act, 2017 stipulates that any person who fails to appear before the officer of central tax, when issued with a summon for appearance to give evidence or produce a document in an inquiry is liable to a penalty which may extend to Rs. 25,000.
What if a person doesn?t apply for registration within 30 days from the date on which he becomes liable for registration? (Posted On: 18 Jun, 2020)

Section 122(1)(xi) of the CGST Act, 2017 stipulates that a taxable person who is liable to be registered under the CGST Act, 2017 but fails to obtain registration shall be liable to pay a penalty of: (a) Rs. 10,000 or (b) an amount equivalent to the tax evaded, whichever is higher.
Whether action can be taken for transportation of goods without valid documents or if goods are attempted to be removed without proper record in books? If yes, explain the related provisions under the CGST Act, 2017. (Posted On: 18 Jun, 2020)

Yes, as per Section 129 of CGST Act 2017 action can be taken for transportation of goods without valid documents or if goods are attempted to be removed without proper record in books. If any person transports any goods or stores any such goods while in transit without the documents prescribed under the Act (i.e. invoice and a declaration) or supplies or stores any goods that have not been recorded in the books or accounts maintained by him, then such goods shall be liable for detention along with any vehicle on which they are being transported.
XYZ (Sender of the goods) and PQR (job worker) both are registered under GST. The activity carried out by PQR amounts to manufacture. PQR is required to charge 12% GST or 18%? Kaustubh Karandikar (Posted On: 18 Jun, 2020)

Notification No. 20/2019 dated 30th Sept 2019 was issued wherein rate for jobwork was prescribed. But due to ambiguous language used in the said notification, CBIC clarified by way of Circular No. 126/45/2019-GST dated 22nd November 2019 that- a. Any service provided by way of treatment or processing undertaken by a person on goods belonging to another registered person will be considered under the Job work service and liable @ 12%. b. any service provided to Non registered person by way of treatment or processing will be covered under manufacturing service and liable @ 18%. Since the job work services are provided to a registered person then PQR is required to charge 12%.
What is the threshold limit for obtaining registration in GST for Service providers Rs. 40 lakhs or Rs. 20 lakhs? (Posted On: 17 Jun, 2020)

Notification No. 10/2019-Central Tax was issued on 7th march 2019 increasing the threshold limit for registration to Rs. 40 lakhs but this is for suppliers who supply goods. For service providers there is no change in the limit of Rs. 20lakhs for registration.
Can an advance ruling given be nullified? (Posted On: 17 Jun, 2020)

Section 104 states the circumstances under which the ruling would be considered as void and hence would lose its binding value. If the Authorities (AAR and Appellate Authority) find that the advance ruling pronounced has been obtained by the applicant/appellant by fraud or suppression of material facts or misrepresentation of facts, it may, by order, declare such ruling to be void ab-initio. Consequently, all the provisions of the CGST Act shall apply to the applicant as if such advance ruling had never been made (but excluding the period when advance ruling was given and up to the period when the order declaring it to be void is issued). An order declaring advance ruling to be void can be passed only after hearing the applicant/ appellant. A copy of the order so made shall be sent to the applicant, the concerned officers and the jurisdictional officer.
What are the duties of Anti-profiteering Authority? (Posted On: 17 Jun, 2020)

The duties of the Anti-profiteering Authority are: (i) to determine whether the reduction in tax rate or the benefit of input tax credit has been passed on by the seller to the buyer (hereinafter collectively referred to as ‘benefit’) by reducing the prices (ii) to identify the taxpayer who has not passed on the benefit (iii) to order (a) reduction in prices (b) return to the recipient, an amount equivalent to the amount not passed on by way of commensurate reduction in prices along with interest at the rate of 18% from the date of collection of the higher amount till the date of the return of such amount or recovery of the amount not returned, as the case may be. If the eligible person does not claim return of the amount or is not identifiable, the amount must be deposited in the Consumer Welfare Fund; (c) imposition of penalty (d) cancellation of registration (iv) to furnish a performance report to the GST Council by the 10th of the month succeeding each quarter [Rule 127 of the CGST Rules, 2017].
A show cause notice was issued demanding GST of Rs. 1,80,180. However, adjudicating authority after the personal hearing found that there was a typographical error while mentioning the amount of GST and he confirmed the demand for Rs. 10,80,180. What is the to be done if the order has been issued. (Posted On: 17 Jun, 2020)

As per section 75(7) of the CGST Act, 2017, inter alia, the amount of tax, interest and penalty demanded in the order cannot exceed the amount specified in the notice. Since, in the given case, the amount of tax demanded in the order exceeds the amount of tax demanded in the show cause notice, the assessee can file an appeal against the adjudication order within the prescribed time limit.
What is zero-rated supply under IGST Act, 2017. How are zero-rated supplies different from exempt supplies made by a registered person in respect of issuance of invoice? (Posted On: 17 Jun, 2020)

Zero rated supply means any of the following supplies of goods or services or both, namely: (a) export of goods or services or both; or (b) supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit [Section 2(23) of the IGST Act read with section 16 of the IGST Act]. A registered person supplying exempted goods or services or both shall issue, instead of a tax invoice, a bill of supply whereas in case of zero-rated supplies, normal tax invoice shall be issued.
Under the Customs Act, 1962, what shall be the relevant date for determining the rate of exchange in case of imported goods? (Posted On: 16 Jun, 2020)

Ans. Sir the relevant date shall be the date of Presentation of Bill of entry.
What is Anti-profiteering measure? (Posted On: 16 Jun, 2020)

Ans. As per section 171 of the CGST Act, any reduction in rate of tax on any supply of goods or services or the benefit of input tax credit shall be passed on to the recipient by way of commensurate reduction in prices. National Anti-profiteering Authority may examine whether input tax credits availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in the price of the goods or services or both supplied by him.
Is an Agent, supplying goods on behalf of some other taxable person and its aggregate turnover does not exceed Rs. 20 lakh during the financial year require to take registration under GST? (Posted On: 16 Jun, 2020)

Ans. Yes, as per section 24, a person supplying goods/services or both on behalf of other taxable persons whether as an agent or not is liable to be compulsorily registered even if its aggregate turnover does not exceed the limits specified above in the financial year.
A taxable person is in the business of information technology. He buys a motor vehicle for use of his Executive Directors. Can he avail the ITC in respect of GST paid on purchase of such motor vehicle? (Posted On: 16 Jun, 2020)

Ans: No. As per section 17(5), ITC cannot be availed on Motor vehicles used for transportation of persons having approved seating capacity of not more than thirteen persons (including the driver) Except when they are used for making the following taxable supplies: (A) further supply of such motor vehicles; or (B) transportation of passengers; or (C) imparting training on driving such motor vehicles Since your case does not fall in any of the above category, therefore, you are not eligible to take the credit.
Whether e way bill need to be generated in case of B2C sale of tractor to resident of Rajasthan from Punjab. Tractor is delivered in Punjab against delivery challan and will be self driven to Rajasthan? (Posted On: 16 Jun, 2020)

Ans. As per Rule 138(14) of CGST Rules 2017, specifies the transactions where E way bill is not required to be generated. Out of the list one specified in the Annexure is “Used Personal and Household Effects”. And further in the case of Kum Motor Co P. Ltd., Kerala high court held that car cannot be detained for omission to upload e-way bill as goods having come into possession of purchaser had become his used personal effect. So in our opinion E way bill is not required to be generated in your case as well.
Is it necessary to create GRN for purchase of Diesel? if not what is the implications in accounts pls. clarify sir. sridhar (Posted On: 16 Jun, 2020)
What is the ITC entitlement of a newly registered person? (Posted On: 15 Jun, 2020)

A person applying for registration can take input tax credit of inputs held in stock and inputs contained in semi- finished or finished goods held in stock on the day immediately preceding the date of grant of registration. If the person was liable to take registration and he has applied for registration within thirty days from the date on which he became liable to registration, then ITC of inputs held in stock and inputs contained in semi- finished or finished goods held in stock on the day immediately preceding the date on which he became liable to pay tax can be taken.
Are there separate valuation provisions for CGST, SGST and IGST and for Goods and Services? (Posted On: 15 Jun, 2020)

Section 15 of CGST Act determines the value of supply of goods or services or both. Further, section 15 is applicable for determining value of taxable supply under IGST as well vide section 20 of IGST Act. Section 20 of IGST Act inter alia provides that the provisions of CGST Act relating to time and value of supply shall mutatis mutandis apply in relation to integrated tax as they apply in relation to central tax. Thus, section 15 is common for all three taxes and also common for goods and services.
Whether e way bill need to be generated in case of B2C sale of tractor to resident of Rajsthan from Punjab. Tractor is delivered in Punjab against delivery challan and will be self driven to Rajsthan. Narinder Gupta (Posted On: 14 Jun, 2020)

As per Rule 138(14) of CGST Rules 2017, specifies the transactions where E way bill is not required to be generated. Out of the list one specified in the Annexure is “Used Personal and Household Effects”. And further in the case of Kum Motor Co P. Ltd., Kerala high court held that car cannot be detained for omission to upload e-way bill as goodshaving come into possession of purchaser had become his used personal effect. So in our opinion E way bill is not required to be generated in your case as well.
My client has a (IOCL dealer) petrol pump.Petrol and diesel is under VAT but lubricants is under GST.We are paying GST on Sale of lubricants as agregate turnover is in crores.(1)Company gives us dealer margin by crediting our account every month.Do we have to pay gst on these amounts? (2)Company does LFR(Liscence Fee Recovery )by debiting our account each month.GST is charged and reflects in our 2A on portal.Can we take input credit of this amount? There are conflicting opinions so requesting guidance? Anand Gulanikar (Posted On: 14 Jun, 2020)

Sir we would like to know what is dealer margin (Is it any form of commission) and License Fee recovery (To what product is the fee related to, petrol, diesel or lubricants).
Easy Coupons Ltd. sells coupons that are redeemable against specified luxury food products at retail outlets. Each coupon has a face value of Rs. 900 but is redeemable for supplies worth Rs. 1000. What is the value of supply of such coupon under GST laws? (Posted On: 13 Jun, 2020)

In terms of rule 32(6) of the CGST Rules relating to valuation, the value of a coupon is the money value of the goods redeemable against it. Therefore, though the coupon is sold for Rs. 900, its value is Rs. 1000.
A company provides service of testing of electronic devices. In one case, it tested a batch of devices on 4th and 5th September but could not raise invoice till 19th November because of some dispute about the condition of the devices on return. The payment was made in December. What is the method to fix the time of supply of the service? (Posted On: 13 Jun, 2020)

The time of supply of services, if the invoice is not issued in time, is the date of payment or the date of provision of service, whichever is earlier [as per Section 13(2)(b)]. In this case, the service is provided on 5th September but not invoiced within the prescribed time limit. Therefore, the date of provision of service, i.e., 5th September, will be the time of supply.
Which are the matters enumerated in Section 97 for which advance ruling can be sought? (Posted On: 13 Jun, 2020)

The definition of Advance ruling given under the Act is a broad one. Under GST, Advance ruling can be obtained on a proposed transaction as well as a transaction already undertaken by the appellant. Advance Ruling can be sought for the following questions:- (a) classification of any goods or services or both (b) applicability of a notification issued under the provisions of CGST Act (c) determination of time and value of supply of goods or services or both (d) admissibility of input tax credit of tax paid or deemed to have been paid (e) determination of the liability to pay tax on any goods or services or both (f) whether applicant is required to be registered (g) whether any particular thing done by the applicant with respect to any goods or services or both amounts to or results in a supply of goods or services or both, within the meaning of that term.
What is the HSN Code for Electrical Chairs and what is the rate of tax? (Posted On: 13 Jun, 2020)

Electrical chairs fall under HSN 9402 and the applicable rate of tax is 18%.
What is the time period for applicability of Advance Ruling? (Posted On: 13 Jun, 2020)

The law does not provide for a fixed time period for which the ruling shall apply. Instead, it has been provided that advance ruling shall be binding till the period when the law, facts or circumstances supporting the original advance ruling have not changed.
for purchase of Diesel for Generator purpose shall we avail any VAT on that how can we avail that sridhar (Posted On: 13 Jun, 2020)

Sir we deal in matters only related to GST and can’t guide you on VAT related Queries.
Sir, Suppose I purchase Diesel from petrol bunk and used in company generator what will be the tax? I am not preparing any Goods receipt note for that is whether I am doing correct or not ? if not correct what is the procedure and can I take a credit on that purchases pls. tell me sir Sridhar (Posted On: 13 Jun, 2020)

Sir we deal in matters only related to GST and can’t guide you on VAT related Queries.
XYZ Ltd. are procuring material from local supplier against advance license invalidation letter. XYZ are getting benefits from supplier against invalidation viz. 1) Cash discount for immediate payment 2) Invalidation benefit of Rs. 4.5 per kg 3) Rate difference between PO rate and Market rate as on date of supply (This can be receivable or payable). XYZ will be issuing Debit Note to the supplier for getting these benefits. Is XYZ required to pay GST on the debit note amount? Kaustubh Karandikar (Posted On: 13 Jun, 2020)

As per Section 15(3) of CGST Act 2017, if discount is known before or at the time of sale then GST is to be effected on the debit note issued for discount. If it is not known, then no effect of GST is to be given. Moreover, this is also clarified by way of circular No. 92/11/2019-GST dated 07.03.2019 under the head ‘Secondary discounts’. Therefore, you are required to give GST effect in debit note.
In case of GST under reverse charge on ocean freight, for FOB contracts, importer to pay IGST @ 5% as per Sr. No.9(ii) of Notification. No. 8/2017-Integrated Tax (Rate) on freight charges paid to the foreign shipping line. In case of CIF Contracts, importer to pay IGST @ 5% as per Sr. No.9(ii) of Notification. No. 8/2017-Integrated Tax (Rate) on 10% of the CIF value as per Bill of Entry (Without considering the Gujarat High Court decision). Is my understanding correct sir? Kaustubh Karandikar (Posted On: 12 Jun, 2020)
Can I Send guar split for Job work process for converting it to powder. (Posted On: 12 Jun, 2020)

Yes sir, there is no issues in sending for Job work. Even though the rate of duty on guar gum split is 5% and rate of GST on final product guar gum powder is 18% then also there is no ban on doing job work.
XYZ carries goods from Vadodara to Pune. The value of the goods is Rs. 80,000 which are chargeable to tax @ 18% IGST and in transit, proper officer intercepted the same under section 68 of the CGST Act, and found contravention. What shall be the penalty payable under section 129 of CGST Act, 2017: a. If XYZ comes forward for payment of tax and penalty, b. If XYZ does not come forward for payment of tax and penalty. (Posted On: 12 Jun, 2020)

The penalty payable under section 129 of the CGST Act, 2017 is (a) 100% of the tax payable on goods detained or seized where the owner of the goods comes forward for payment of tax and penalty; (b) 50% of the value of the goods reduced by the tax amount paid thereon where the owner of the goods does not come forward for payment of tax and penalty.By virtue of section 20 of the IGST Act, 2017 provisions of penalty payable under section 129 of the CGST Act, 2017 apply in case of IGST as well. However, where the penalty is leviable under the CGST Act, 2017 and the SGST/UTGST Act, 2017, the penalty leviable under the IGST Act, 2017 shall be the sum total of the said penalties. Therefore, penalty payable under IGST Act, 2017 is double the penalty payable under section 129 of the CGST Act, 2017.
What are cognizable and non-cognizable offences under section 132 of CGST Act, 2017? (Posted On: 12 Jun, 2020)

As per section 132(5) of CGST Act, 2017, following offences are cognizable offences, provided amount of tax evaded or input tax credit wrongly availed/utilised or refund wrongly taken >Rs. 5 crores, namely: (a) Supply without issuance of invoice with the intention to evade tax (b) Issuance of any invoice/bill without supply leading to wrongful availment/utilisation of ITC or refund of tax (c) Availment of ITC using invoice/bill against which no supplies have been made (d) Failure to pay the amount collected as tax to the Government beyond a period of 3 months from the due date of payment. Further, section 132(4) of CGST Act, 2017 provides that all offences specified under section 132 are non-cognizable offences except the cognizable offences.
I failed to pay the GST amounting to Rs. 7,400 for the month of January. The proper officer imposed a penalty for failure to pay tax. In my opinion it is a minor breach and in accordance with the provisions of section 126 of the CGST Act, 2017, no penalty is imposable for minor breaches of tax regulations. Am I Right. (Posted On: 12 Jun, 2020)

No, your claim is not tenable in law. Section 126(1) of the CGST Act, 2017 provides that no officer shall impose any penalty under CGST Act, 2017, inter alia, for minor breaches of tax regulations or procedural requirements. Further, explanation to section 126(1) of the CGST Act, 2017 stipulates that a breach shall be considered a ‘minor breach’ if the amount of tax involved is less than Rs. 5,000. In the given case, breach made is not a ‘minor breach’ since the amount involved is not less than Rs. 5,000. So, penalty is imposable under the CGST Act, 2017.
Mr. X, an unregistered person under GST purchases the goods supplied by Mr. Y who is a registered person without receiving a tax invoice from Mr. Y and thus helps in tax evasion. What disciplinary action may be taken by tax authorities to curb such type of cases and on whom? (Posted On: 11 Jun, 2020)

Both Mr. X and Mr. Y will be offender and will be liable to penalty as under: Mr. X – Penalty under section 122(3) which may extend to Rs. 25,000/-; Mr. Y – Penalty under section 122(1), which will be higher of following, namely (i) Rs. 10,000/- or (ii) 100% of tax evaded.
What is the HSN for Spray guns used on bottles? (Posted On: 11 Jun, 2020)

Spray guns fall under the HSN 3926 taxable at the rate of 18%.
Every month I raise an invoice for Rent of about Rs. 2,00,000/- + GST. But due to the pandemic spread of COVID -19, the tenant has requested for relaxing the amount of rent. So we have agreed to a rent of Rs. 1,45,000/-+GST. Can I show the difference amount asdiscount. Please do advice on this transaction on GST. (Posted On: 11 Jun, 2020)

In this situation we would suggest that you should amend the rent agreement rather than showing as a part of discount given in Profit/Loss a/c. This is due to the fact that if discount is given then department will raise question that it was not know at the time of agreement. Hence, it cannot be deducted and GST is to be paid on full value.
GST Refund is claimed before March-19 but sanctioned in April-19. How to report such kind of situation in Part VI Table-15? (Posted On: 11 Jun, 2020)

GST Refund claimed during April 18 to March 19 is to be reported in Table-15A. Ifrefund is sanctioned after March-19 then that is not to be reported in Table-15B.Same principle will hold good for other refund and demand details. However, we have represented to the government to insert such a column in the annual return for claims/demand made in 2018-19 but sanctioned/confirmed in 2019-20.
Sir I am providing one free pencil if the customer purchases a pack of 5 pens. Am I required to reverse the credit relating to free supply of pencil purchased? (Posted On: 11 Jun, 2020)

In our opinion nothing is free in this world. We believe that the cost of pencil is also included total sale price of pack of pens. So there is no requirement to reverse the credit. Further Circular no. 92/11/2019-GST dated 07.03.2019 have been issued wherein clarification has been given with respect to sales promotion and discount schemes, one of which is ‘Buy one get one free offer’. It was clarified that ITC shall be available to the supplier for the inputs, input services and capital goods used in relation to supply of goods or services or both as part of such offers.
What is the liability of partners of firm to pay tax (Posted On: 10 Jun, 2020)

Section 90 of the CGST Act explains the liability of partners of firm to pay tax as under:- Partners of the firm jointly and severally liable to pay any tax, interest or penalty of the firm: Notwithstanding any contract to the contrary and any other law for the time being in force, where any firm is liable to pay any tax, interest or penalty under this Act, the firm and each of the partners of the firm shall, jointly and severally, be liable for such payment. Retiring partner liable to pay any tax, interest or penalty of the firm due up to the date of his retirement: Where any partner retires from the firm, he or the firm, shall intimate the date of retirement of the said partner to the Commissioner by a notice in that behalf in writing and such partner shall be liable to pay tax, interest or penalty due up to the date of his retirement whether determined or not, on that date. However, if no such intimation is given within 1 month from the date of retirement, the liability of such partner shall continue until the date on which such intimation is received by the Commissioner.
A registered person under GST, has sold whole of its business to XYZ. Who is liable to pay GST under GST law [determined before sale, but still unpaid] upto the time of such transfer. (Posted On: 10 Jun, 2020)

Where a taxable person, liable to pay tax under this Act, transfers his business in whole or in part, by sale, gift, lease, leave and license, hire or in any other manner whatsoever, the taxable person and the person to whom the business is so transferred shall, jointly and severally, be liable wholly or to the extent of such transfer, to pay the tax, interest or any penalty due from the taxable person upto the time of such transfer, whether such tax, interest or penalty has been determined before such transfer, but has remained unpaid or is determined thereafter.
Whether advances received during pre-GST regime but against which invoice is not yet issued is to be reported in Table-4F (Posted On: 10 Jun, 2020)

No, only advances on which GST has been paid but remained unadjusted as invoice not issued is to be reported in Table-4F.
Whether any disclosure is required in the Annual Return for Goods sent to a job worker for which ITC-04 has been filed in the Financial Year? (Posted On: 10 Jun, 2020)

Goods sent to job worker on delivery challan are not in the nature of supply provided the goods are received back within the specified period. There is no requirement of disclosure of such removal in the Annual Return. However, if the goods are not received back within specified time period, it is treated as if supply has been made on the date of original removal of goods and tax has to be paid by the principal. Such instances have to be reported in the table 4 and Table 16B of the Annual Return. However, Notification 38/2019-CT dated 31.08.2019 issued waiving requirement to furnish declaration in FORM ITC-04 for the period July, 2017-March 2018 and FY 2018-19
How benefits availed by a company of taking input credit as result of demerger be disclosed in annual return? (Posted On: 10 Jun, 2020)

The recipient company needs to disclose the details in annual return under Part III, Sl. No. 6 and Table field (M). Against the heading “Any other ITC availed as not specified above”. Doing this will ensure the reporting requirement for the new company. In prior of which, to successfully claim such credits the reporting company shall file form ITC-02 on the common portal.
We have paid GST in FY 19-20 against bill submitted to Service reciver but till date I have not received my amount from the Co. now can I get refund from Govt. or shall we claim that amount from govt. ? Pls suggest Rohit (Posted On: 09 Jun, 2020)

Credit note can be issued if there is definciency in providing service or discount given on the basis of discount policy known before issue of invoice or material is returned. But credit note cannot be issued for bad debts. However, if it is due to above reason then you can raise credit note till September 2020.
That the amendment with reference to FY 17-18 such as (+)/(-) in the sale amount and/or ITC which was unclaimed/reversible for the FY 17-18, but the same was declared in the monthly/quarterly returns 3B and GSTR-1 for the financial year 18-19 till March 2019.That while filling GSTR-9 for the FY 18-19 all the above amendment for 17-18 which was declared in GST returns of FY year 18-19 needs to be done vice versa to arrive at the actual sale amount and/or ITC availed in the FY 8-19.That after perusal of the entire GSTR-9 form for 18-19and after working on it we couldn’t find any columns where the same can be acknowledged to arrive at the actual Turnover/ITC fir Fin. Yr. 2018-19. In the above circumstance I hereby request you to kindly resolve and/or issue guiding principle for the above mentioned issues since the time for filing of GSTR-9 for 18-19 is running every day. For Example: For the financial year sale amount of Rs.10000.00, CGST & SGST of Rs. 250 & 250 respectively was by mistake not filed in 17-18 and the same was effected in September 2018 GST Returns and for Fin. Yr. 17-18 one purchase ITC CGST & SGST of Rs. 500 & 500 respectively was claimed in October 2018 GST returns. The above adjustments are being reflected in Fin. Yr. 18-19 GST returns summary/GSTR9 reports also but does not form part of Turnover/Purchase ITC of Fin. Yr. 18-19, which needs to be rectified and where to mention the same in the GSTR-9 for FY 18-19. (Posted On: 09 Jun, 2020)

Disclosure in GSTR 9 and 9C of 2018-19 relating to ITC It is to be shown in Table 6 in GSTR 9 and Table 12B (ITC booked in earlier Financial Years claimed in current Financial Year), Table 12E (ITC claimed in Annual Return- Table 7J), and Table 14S (ITC availed pertaining to different expenses) in GSTR 9C. Although it has been disclosed in Table 8C & Table 13 of GSTR 9 of FY 2017-18, therefore, it was merely a disclosure and had no monetary impact. Further, in case of GSTR 9C, it was reflected in Table 12C of GSTR 9 filed for FY 2017-18. Disclosure in GSTR 9 and 9C of 2018-19 relating to sales The tax payable would be more than the tax paid in 2018-19(when excess tax adjustment made) and vice a versa in table 9 of GSTR 9. Tax payable reflects the actual tax payable as per sales of 2018-19 and tax paid is the payment made in GSTR 3B in the financial year 2018-19. The best practice is that mention a note about it in Audit Report i.e. to read this with annual return of 17-18.
Our client has shown excess supply of rs 200000/- in 3b of 18-19 which was reduced in 3B of April 19-20, now where to show this excess supply in gstr9? (Posted On: 09 Jun, 2020)

Higher amount should be shown in 4B COLUMN of GSTR 9 and the excess amount which is adjusted in next year GSTR 3B should be shown in Part V- Table 11 under Supplies/ Tax reduced through amendments.
If lubricant sold by petrol dealer then what to take in turnover. (Posted On: 09 Jun, 2020)

Ans- Aggregate turnover” means the Aggregate value of all taxable supplies, exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number. “Exempt supply” means supply of any goods or services or both which attracts nil rate of tax or which may be wholly Exempt from tax under section 11, or under section 6 of the Integrated Goods and Services Tax Act, and includes non-taxable supply (Petrol). In your case, if turnover is more than 2 crore upto 5 crores, taxpayer is required to file GSTR-9 only for the financial year 2018-19. If exceeding 5 crores, then you have to file both GSTR 9 and GSTR 9C for the same year. Your turnover will include sales of petrol and lubricant both.
A person is chargeable with tax in case of fraud. He decides to pay the amount of demand along with interest before issue of notice. Is there any remedy available to such person? (Posted On: 09 Jun, 2020)

Yes. Person chargeable with tax, shall have an option to pay the amount of tax along with interest and penalty equal to 15% per cent of the tax involved, as ascertained either on his own or ascertained by the proper officer, and on such payment, no notice shall be issued with respect to the tax so paid [Section 74(6)].
Which records are to be produced during access to business premises under section 71 of the CGST Act, 2017? (Posted On: 09 Jun, 2020)

The following records are to be produced, if called for, during access to business premises under section 71 of the CGST Act, 2017. (i) the records prepared and maintained by the registered person and declared to the proper officer in the prescribed manner. (ii) trial balance or its equivalent. (iii) statements of annual financial accounts, duly audited. (iv) cost audit report, if any. (v) the income - tax audit report, if any. (vi) any other relevant record.
Dear Sir We had filed TRANS-1 well with in the specified due date, but there was a considerable delay in transfering the credit to PMT-3 by the department. We have written several letters to the department on this issue. After waiting for 2 months, we availed the input tax credit as per our Trans-1 filed with the department. later the entire credit applied in Trans-1 was transferred to electronic credit ledger by the department. Now they have raised a demand notice for the payment of interest on the ITC utilized from Trans-1. Please clarify whether we can contest the notice. Anantharamaiah Ravindra (Posted On: 09 Jun, 2020)

Sir, you can contest against the notice on the basis that interest cannot be demanded due to fault made by the portal that even after filing TRANS-1 credit was not transferred. Further it can also be contended that credit was only availed only after writing letters to department about the non - transfer of credit. Reference to the case of Vision Distribution Pvt. Ltd. can also be given. In this case the assessee approached High Court for granting refund of amount paid in cash due to delay in credit of transitional credit in its electronic credit ledger and the Hon’ble Delhi High Court provided relief to the assessee. To know more on this case please refer to ‘GST UPDATE ON COMPENSATION FOR DELAYED BENEFIT OF TRANSITIONAL CREDIT 61/2020-21’ published on our website.
What is meant by the term “arrest”? (Posted On: 08 Jun, 2020)

The term ‘arrest’ has not been defined in the GST Act. However, as per judicial pronouncements, it denotes ‘the taking into custody of a person under some lawful command or authority’. Arrests can be carried out only where the person is accused of offences specified for this purpose and the tax amount involved is more than specified limit. Further, the arrests under GST Act can be made only under authorisation from the Commissioner. Whenever the Commissioner has reason to believe that any person has committed any such offence, he can authorize any other officer subordinate to him, to arrest such person.
Who can order for search and seizure under the provisions of CGST Act? (Posted On: 08 Jun, 2020)

Where the proper officer not below the rank of a Joint Commissioner has reasons to believe that a place of business or any other place is to be visited for the purposes of inspection or search or seizure in accordance with the provisions of section 67, he shall issue an authorisation authorising any other officer subordinate to him to conduct the inspection or search or seizure of goods, documents, books or things liable to confiscation.
A credit note has been issued for sales returns (interstate) in March 2020. However, no interstate supply has been made in March 2020. How can the liability be adjusted in GSTR-3B? (Posted On: 08 Jun, 2020)

You have to carry forward the credit note of March 2020 to April 2020 GSTR-3B. There is no other option available as the GSTN does not accept negative values.
What happens if we file with more than 20% deviation in values in any of the columns of GSTR 9? What can I expect next from the government and how do I respond? (Posted On: 08 Jun, 2020)

Majority of the details in the Tables of GSTR-9 will be auto-populated from GSTR-1 and GSTR-3B. A taxpayer can edit these auto-populated values but if the difference is more than 20%, the cells will be highlighted in red and a confirmation message will pop-up asking ‘if the taxpayer wants to proceed despite deviation.’ GST Authorities can issue a notice asking the assessee to determine the reason of deviation.
A sales figure that was originally reported as B2C sales in GSTR-1, was later corrected to B2B sales, how should the reporting be done? (Posted On: 08 Jun, 2020)

Table 4 of GSTR-9 requires details of both B2B and B2C supplies. In this case, the assessee has to report sales under B2B in Table 4, as this is the correct classification even though it was wrongly reported as B2C in GSTR-1.
Who can order for carrying out Inspection? (Posted On: 06 Jun, 2020)

Ans: As per Section 67 of CGST Act, inspection can be carried out by proper officer only upon a written authorization given by an officer of the rank of Joint Commissioner or above. It is a softer provision than search to enable officers to access any place of business of a taxable person and also any place of business of a person engaged in transporting goods or who is an owner or an operator of a warehouse or godown.
Is credit admissible on fitness equipment purchased for residential quarters of employees. (Posted On: 06 Jun, 2020)

Ans. Credit is not available on fitness equipment if it is purchased for residential quarters of employees. Since as per section 16 of CGST Act, it is not in furtherance of business. Moreover, advance ruling authority in case of M/s. Kandla Port Trust (GST AAR Gujarat) GUJ/GAAR/R/13/2019 dated 22.02.2019 has taken the same stand.
We have supplied to SEZ unit and forgot to tick “SEZ with payment of Tax” while filing GSTR-1 return. But later amendment was made in the later months. And in GSTR-3B as well we have mistakenly shown in 3(1)(a) instead of in 3(1)(b). What can be done now? (Posted On: 06 Jun, 2020)

Ans. One of our client have also faced the same problem. The only way is to pursue the department on regular basis for this case. They can only help you in this matter. CBIC has also clarified vide circular number 125/44/2019-GST dated 18.11.2019 in point number 25 that even if we have shown the SEZ clearance in 3.1(a) in place of 3.1(b) then also refund should be granted.
Sir I purchased a car on 01.10.2018 and want to sell this now. Can I avail the benefit of margin scheme? (Posted On: 06 Jun, 2020)

Ans. Sir you can avail the benefit of margin scheme. As per notification No. 8/2018 -Central Tax (Rate) dated 25th January, 2018, if the supplier of such goods has availed input tax credit as defined in clause (63) of section 2 of the Central Goods and Services Tax Act, 2017, CENVAT as defined in CENVAT Credit Rules, 2004 or the input tax credit of Value Added Tax or any other taxes paid, on such goods, then he can avail benefit of such scheme. If you have availed credit of the car purchased, then only the benefit will be denied.
Sir while applying the refund for inverted duty structure, we had mistakenly claimed the credit of a few bills of input services as well which was supposed to be not claimed. Shall we ask the officer to reject our refund application? So please guide on what is to be done now. (Posted On: 06 Jun, 2020)

Ans. We would like to suggest that instead of asking the officer to reject the application, ask them to issue the deficiency memo. So that it can be rectified and a fresh application can be filed again.
A registered person under GST (dealing in exempt goods) has not reversed his ITC, i.e itc wrongly availed, no effect given on gstr 3B for reversal, but while filling annual return reversal is done. Now, what remedy he has against demand order received (for the amount & interest there upon)?? As he does not has any outward GST liability, the ITC is unutilized and accumulated in ledger balance. Is interest required to be paid ?? As he has no outward liability. Siddharth Mehta (Posted On: 05 Jun, 2020)

In our opinion interest is required to be paid as section 73 of CGST Act 2017 uses the term ‘where input tax credit has been wrongly availed or utilised for any reason’. In this the emphasis stands on the term ‘or’ instead of using the term ‘and’. So interest is to be paid irrespective of the fact that the credit has not been utilised and there is no outward liability.
Who can conduct audit of taxpayers? (Posted On: 05 Jun, 2020)

There are three types of audit prescribed in the GST Act as explained below: (a) Audit by Chartered Accountant or a Cost Accountant: Every registered person whose turnover exceeds the prescribed limit, shall get his accounts audited by a chartered accountant or a cost accountant. (Section 35(5) of the CGST Act) (b) Audit by Department: The Commissioner or any officer of CGST or SGST or UTGST authorized by him by a general or specific order, may conduct audit of any registered person. The frequency and manner of audit will be prescribed in due course. (Section 65 of the CGST Act) Audit may be conducted for a financial year, or part thereof or multiples thereof. (c) Special Audit: If at any stage of scrutiny, inquiry, investigations or any other proceedings, if department is of the opinion that the value has not been correctly declared or credit availed is not with in the normal limits, department may order special audit by chartered accountant or cost accountant, nominated by department. (Section 66 of the CGST Act)
Who is responsible for the maintenance of proper accounts related to job work? (Posted On: 05 Jun, 2020)

It is completely the responsibility of the principal to maintain proper accounts of job work related inputs and capital goods.
Sales that were originally reported as “With payment of taxes”, was later corrected to “Without payment of Taxes”, should this be reported in Table 4C? (Posted On: 05 Jun, 2020)

As the correct nature of sales in this case is without payment of taxes, the same should be reported in Table 5A and not Table 4C of GSTR-9. A correct reporting needs to be done in GSTR-9 irrespective of the fact that it was wrongly reported in GSTR-1 as ‘With payment of taxes’.
I am a providing management consultancy services and want to know the period for which the books of accounts or other records need to be maintained. Please Guide. (Posted On: 05 Jun, 2020)

Section 36 of the CGST Act stipulates that every registered person required to keep and maintain books of account or other records in accordance with the provisions of sub-section (1) of section 35 shall retain them until the expiry of 72 months from the due date of furnishing of annual return for the year pertaining to such accounts and records. However, a registered person, who is a party to an appeal or revision or any other proceedings before any Appellate Authority or Revisional Authority or Appellate Tribunal or court, whether filed by him or by the Commissioner, or is under investigation for an offence under Chapter XIX, shall retain the books of account and other records pertaining to the subject matter of such appeal or revision or proceedings or investigation for a period of one year after final disposal of such appeal or revision or proceedings or investigation, or for the period specified above, whichever is later.
A registered firm has filed GSTR-1 declaring an outward supply of Rs. 300 lakhs. The return was filed within the due date of its filing. However, on a subsequent reconciliation of the return with the books of accounts it was found that 5 invoices having a total value of Rs. 20 lacs towards supply made to local parties were mistakenly omitted to be reported. Please suggest. (Posted On: 05 Jun, 2020)

As per GST law, the mechanism of filing revised returns for any correction of errors/omissions has been done away with. The rectification of errors/omissions is allowed in the subsequent Returns. However, no rectification is allowed after furnishing the return for the month of September following the end of the financial year to which such details pertain or furnishing of the relevant annual return, whichever is earlier. Hence, the omission can be included in the Return for the month when the omission is noticed. The tax and interest @ 18% due on the turnover omitted to be reported has to be paid along with the taxes for the month in which the omission is noticed. However, such rectification will be allowed only within the prescribed period as mentioned above.
Can RCM Credit be claimed in the return of same month in which it is paid ? (Posted On: 05 Jun, 2020)
Can i file the GSTR 3B return without payment of tax? (Posted On: 04 Jun, 2020)

As per section 2(117) of CGST Act, “valid return” means a return furnished under sub-section (1) of section 39 on which self-assessed tax has been paid in full. Hence, in such a case, the return is not considered as a valid return and also input tax credit will not be allowed to the recipient of supplies.
Whether sale of old car below WDV is an exempt sale and requires reversal of ITC? (Posted On: 04 Jun, 2020)

In our opinion sale of old car below WDV is not an exempt sale and so there is no requirement for reversal of credit. It doesn’t form part of aggregate turnover in GST. The profit earned from the sale of car is only taxable under GST.
Sir our vehicle has been detained due to mistake in e way bill generation and we paid the tax and penalty demanded by the tax officers as per section 129 of CGST Act. However, we filed an appeal against the said detention. The appeal was decided in our favor. Now we want to claim refund for the tax and penalty paid. We are unable to file refund because the DRC-03 filed by us at the time of detention didn’t interlink on the portal with the appeal filed as intimated by department. What is to be done now, how can we claim refund. (Posted On: 04 Jun, 2020)

We would suggest that refund claim be filed under the head ‘Others’ on the GST portal.
A supply transaction is to be undertaken between two EOUs. What are the required formalities to be fulfilled? (Posted On: 04 Jun, 2020)

Intimation is to be given to development Commissioner and Customs authority of the supplier and the receiver and IGST is to be charged by the supplier. Further the tax used in inputs for generating the export products is to be debited from bond and when export is made, it will be credited again. But if export is not made by the receiver EOU, then the amount equal to the tax debited in the bond have to be borne by the recipient.
Sir we had to export at the rate of 12% but we exported at rate of 18% by mistake. While filing the return, we realized this mistake , now what is to be done? (Posted On: 04 Jun, 2020)

A credit note is to be issued for the difference of 6%. Further in GSTR-1, the export invoice should be reflected with the tax rate @ 18% as the shipping bill is also prepared with the same rate. If there is any difference between GSTR 1, GSTR 3B and shipping bill, the export details are not transmitted to ICE GATE portal and results in blockage of capital. The credit note prepared against the export should be filled in respective column in GSTR 1. The issue may arise here that the refund will be sanctioned to you @18% because the credit note details don’t get linked with the ICEGATE portal. Department may raise query for refunding 6% in cash.
How can an insolvent registered person obtain registration under GST? (Posted On: 03 Jun, 2020)

Sir government has enabled the facility for registration for Corporate debtors with IRP/RP. While applying for fresh registration, after obtaining TRN, the portal asks for reason to obtain registration. The option of “CORPORATE DEBTORS UNDERGOING CORPORATE INSOLVENCY RESOLUTION PORCESS WITH IRP/RP” has also been added. For details please refer to “GST Hindi update on facility for registration of IRP/RPs made available on the GST Portal 51H/2020-21” published on our websitewww.capradeepjain.com
What is the time period within which invoice has to be issued where the goods being sent or taken on approval for sale? (Posted On: 03 Jun, 2020)

As per Section 31(7) of the CGST Act, 2017, Where the goods being sent or taken on approval for sale or return are removed before the supply takes place, the invoice shall be issued: (i) before/at the time of supply or (ii) 6 months from the date of removal whichever is earlier
Can you please state the time period within which invoice has to be issued in a case involving continuous supply of goods? (Posted On: 03 Jun, 2020)

As per Section 31(4) of the CGST Act, 2017, In case of continuous supply of goods where successive statements of accounts/ successive payments are involved, the invoice shall be issued before/at the time each such statement is issued or each such payment is received.
Shyam Fabrics has opted for composition levy scheme in the current financial year. Whether it is mandatory for it to issue a tax invoice. Please advice. (Posted On: 03 Jun, 2020)

A registered person paying tax under the provisions of section 10 [composition levy] shall issue, instead of a tax invoice, a bill of supply containing such particulars and in such manner as may be prescribed [Section 31(3)(c) read with CGST Rules, 2017].Therefore, in the given case, Shyam Fabrics cannot issue tax invoice. Instead, it shall issue a Bill of Supply.
Department has issued Deficiency Memo for not uploading Shipping Bill at the time of filing Refund application. What is the remedy? (Posted On: 03 Jun, 2020)

Ans:- As per Circular 135/07/2020, Assessee is not required to upload shipping bill copy if your port is EDI but even if port is an EDI Port and then also department has rejected refund and issued deficiency memo then it is suggested to file new refund application and attach shipping bill even if your port is EDI port.
Can we claim ITC on RCM in the return of same month ? (Posted On: 02 Jun, 2020)
Sultan Industries Ltd., Delhi, entered into a contract with Prakash Entrepreneurs, Delhi, for supply of spare parts of a machine on 7th September. The spare parts were to be delivered on 30th September. Sultan Industries Ltd. removed the finished spare parts from its factory on 29th September. Determine the date by which invoice must be issued by Sultan Industries Ltd under GST law. (Posted On: 02 Jun, 2020)

As per the provisions of section 31 of the CGST Act,2017, invoice shall be issued before or at the time of removal of goods for supply to the recipient, where the supply involves movement of goods. Accordingly, in the given case, the invoice must be issued on or before 29th September.
Does cancellation of registration impose any tax obligations on the person whose registration is so cancelled? (Posted On: 02 Jun, 2020)

Yes, as per section 29(5) of the CGST Act, every registered taxable person whose registration is cancelled shall pay an amount, by way of debit in the electronic cash ledger, equivalent to the credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock or capital goods or plant and machinery on the day immediately preceding the date of such cancellation or the output tax payable on such goods, whichever is higher.
What is the time limit available to the assesses for filing reply of any query raised by the officer in respect of GST registration? ing days from the date of receipt of clarification. (Posted On: 02 Jun, 2020)

If during the process of verification, one of the tax authorities raises some query or notices some error, the same shall be communicated to the applicant and to the other tax authority through the GST Common Portal within 3 common working days. The applicant will have to reply to the query/rectify the error/ answer the query within a period of 7 days from the date of receipt of deficiency intimation. On receipt of additional document or clarification, the relevant tax authority will respond within 7 common work
Department has issued Deficiency Memo for not uploading Annexure B at the time of Refund application i.e .RFD-01. How should the assessee proceeds? (Posted On: 02 Jun, 2020)

Assessee should file new refund application for the period for which refund has been rejected through Deficiency Memo. Assessee should not repeat the same errors at the time of new application for refund i.e. RFD-01 and be more cautious while filing the same.
Can trader take refund on reduced GST rate declared by Government through notification? (Posted On: 02 Jun, 2020)

No, As per Para 3 of circular No. 135/5/2020 dated 31.03.2020, the refund of accumulated ITC would not be admissible under section 54(3)(ii) where the input and the output supplies are the same. The Board has noticed that some of the applicants are seeking a refund of unutilized ITC on account of an inverted duty structure where the reversal is due to GST rate change on the same goods. It is being claimed that collection of ITC in such a case is also covered as accumulation on account of inverted duty structure and such applicants have sought refund of accumulated ITC under clause (ii) of sub-section (3) of section 54 of the CGST Act. Refund of aggregated ITC in wording provision (ii) of sub-section (3) of section 54 of the CGST Act is available in which the credit has accumulated on account of rate of tax being higher on input compared to the rate of tax on output. It needs to be considered that refund of accumulated ITC under clause (ii) of sub-section (3) of section 54 of the CGST Act would not be applicable in cases where the input and the output supplies are the same. This implies that inverted duty refund is not applicable to traders who purchase and sale the same thing but it is applicable to manufacturer who buys different inputs and sale different final product produced out of it.
At the time of registration, will the assessee have to declare all his places of business? (Posted On: 01 Jun, 2020)

Yes. The principal place of business and place of business have been separately defined under section 2(89) & 2(85) of the CGST Act respectively. The taxpayer will have to declare the principal place of business as well as the details of additional places of business in the registration form.
What are the advantages of taking registration in GST? (Posted On: 01 Jun, 2020)

Registration will confer following advantages to the business: • Legally recognition as supplier of goods or services. • Proper accounting of taxes paid on the input goods or services which can be utilized for payment of GST due on supply of goods or services or both by the business. • Legally authorized to collect tax from his purchasers and pass on the credit of the taxes paid on the goods or services supplied to purchasers or recipients. • Make interstate sales without restrictions • Register on e-commerce websites • Become eligible to avail various other benefits and privileges rendered under the GST laws.
Can we take refund of Capital Goods & Input services at the time of refund application of Export without payment of Tax i.e. Export with under LUT/Bond? (Posted On: 01 Jun, 2020)

Rule 89(4) while prescribing a formula for calculating refund in case of zero rated supply of goods or services excludes from the definition of Net ITC, the ITC on capital goods. It means that the taxpayer is not allowed to claim input tax credit on capital goods while filing refund under LUT.
Assessee is registered in GST from 01.07.2017 but till date, he has not filed any return and has not transacted business. Assessee wants to surrender/cancel his registration, can he do so? (Posted On: 01 Jun, 2020)

A registered person can apply for cancellation of GST Registration by himself as per section 29 of the CGST act, 2017. 1) If your business has been discontinued 2) Death of the Proprietor in case of sole proprietorship 3) If the business is no longer liable to GST 4) Others Assessee should file pending returns; making payment of all dues. After that we can file surrender application on online portal and proper officer will verify and may allow our surrender application of registration.
I have wrongly filed Nil Refund. What is the remedy? (Posted On: 01 Jun, 2020)

Circular No. 110/29/2019 – GST dated 03.10.2019 has been issued clarifying that if the person filed Nil refund mistakenly and no refund has been filed for the subsequent period , then he can file the refund claim under “Any Other” category instead of the category under which the NIL refund claim has already been filed. However, the refund claim should pertain to the same period for which the NIL application was filed.
My refund is pending due to Error Code SB 005 and I have amended GSTR 1 pertaining to refund not sanctioned. Even after modification done in GSTR 1 Return related to export with payment of tax, refund has not been credited in our bank account. The refund status on ICEGATE is not providing any valid reason. What is the remedy with me in such case? (Posted On: 30 May, 2020)

You should contact your customs port officer and request him to further process the refund and in case of any error, intimate you the required solution. In case of SB005 error, Government has issued a circular number 22/2020 dated 21.04.2020 and once again provided a facility wherein exporter can approach the custom department for manual correction in invoice number in shipping bill and refund can be processed. This circular should be followed in this case.
Can we amend GSTR 3B Return? (Posted On: 30 May, 2020)

Till the date Government has not given option for amendment of GSTR 3B return. But recently Hon’ble High Court in case of Bharti Airtel Limited Vs. UOI allowed the petitioner to rectify GSTR-3B for the period July, 2017 to September, 2017. A tab has been provided on portal also for such amendment but it is not functional till date.
Can we take refund on invoices not shown in GSTR 2A? (Posted On: 30 May, 2020)

Previously, In terms of circular No. 125/44/2019-GST dated 18.11.2019, the refund of ITC availed in respect of invoices not reflected in FORM GSTR-2A was also admissible and copies of such invoices were required to be uploaded. However, recently Government has issued new circular No. 135/05/202 dated 31.03.2020 and decided that the refund of accumulated ITC shall be restricted to the ITC as per those invoices, the details of which are uploaded by the supplier in FORM GSTR-1 and are reflected in the FORM GSTR-2A of the applicant. Accordingly, para 36 of the circular No. 125/44/2019-GST, dated 18.11.2019 stands modified to that extent. Therefore, as per the aforesaid circular, you are allowed to take refund of those invoices which are not reflecting in GSTR 2A
Krishna Motors is a car dealer selling cars of an international car company. It also provides maintenance and repair services of the other cars sold by it. It seeks your advice on availability of input tax credit in respect of the following expenses incurred by it during the course of its business operations: Cars purchased from the manufacturer for making further supply of such cars. Two of such cars are destroyed in accidents while being used for test drive by potential customers. (Posted On: 30 May, 2020)

As per section 16(1) of the CGST Act, 2017, every registered person can take credit of input tax charged on any supply of goods or services or both to him which are used or intended to be used in the course or furtherance of his business. However, section 17(5) of CGST Act, 2017 specifies certain goods and services on which the input tax credit is not available. Thus, ITC on cars purchased from manufacturer for making further supply of car will be allowed. However, ITC on the cars destroyed in accident will not be allowed as the ITC on goods destroyed for whichever reason is specifically blocked [Section 17(5)(h) of CGST Act]. Hence, we have to reverse this credit if already taken by dealer.
While sending a machinery, in-transit the machinery was destroyed. About 70% of the machine was sold and for the remaining 30% claim was received from insurance company. Now can you guide on GST implication (Posted On: 30 May, 2020)

Sir first of all a credit note is to be issued as the machine was destroyed and was unable to reach the receiver. Next as the 70% of the machine is sold GST is to be paid on this price. For the remaining 30% as insurance claim has been received,no GST is to be paid. Only the insurance premium of policies is taxable under GST; any sum received as claim is not taxable as there is no supply between assesses and the insurance company.
If an unregistered supplier under GST Act supplies goods(value more than 50,000) to an unregistered buyer, then is it mandatory to issue an e-way bill and if yes then what is the procedure for the same. (Posted On: 29 May, 2020)

Yes, E-way Bill is to be generated from the Portal. If one goes through the online E-way bill portal, it has option of enrolment for citizen. Any unregistered person can register under that tab and generate e-way bill.
I have purchased a villa at Hyderabad on 28/12/2017 for Rs.48 lacs. The builder has collected Rs.5.76 lacs as GST in addition. He has not passed on benefit of input tax credit to me. What is the course of action available with me? (Posted On: 29 May, 2020)

GST is applicable on sale of property if it is handed over before the issuance of occupancy certificate. Reduction of price is one of the conditions for the fulfilment of Anti-profiteering provisions specified in section 171 of the CGST Act. In case if you find that the builder has not passed on the benefit, you can file a complaint with the appropriate governmental authority i.e. standing committee or state screening committee to take actions against them.
What are the duties of the person to whom summons has been issued? (Posted On: 29 May, 2020)

A person who is issued summon is legally bound to attend either in person or by an authorized representative and he is bound to state the truth before the officer who has issued the summon upon any subject which is the subject matter of examination and to produce such documents and other things as may be required.
Who can order for carrying out “Inspection”? (Posted On: 29 May, 2020)

As per Section 67 of CGST Act, inspection can be carried out by proper officer only upon a written authorization given by an officer of the rank of Joint Commissioner or above. It is a softer provision than search to enable officers to access any place of business of a taxable person.
What happens when the inputs or capital goods are not received back or supplied from the place of business of job worker within prescribed time period? (Posted On: 29 May, 2020)

If the inputs or capital goods are not received back by the principal or are not supplied from the place of business of job worker within the prescribed time limit, it would be deemed that such inputs or capital goods had been supplied by the principal to the job worker on the day when the said inputs or capital goods were sent out by the principal (or on the date of receipt by the job worker where the inputs or capital goods were sent directly to the place of business of job worker). Thus the principal would be liable to pay tax with Interest. However, Second proviso has been inserted to section 143(1) of CGST Act, to provide that the period of 1 year and 3 years may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding 1 year and 2 years respectively.
What is the validity period of the registration certificate issued to a casual taxable person and non- resident taxable person? (Posted On: 28 May, 2020)

In terms of section 27(1) read with proviso thereto, the certificate of registration issued to a “casual taxable person” or a “non-resident taxable person” shall be valid for a period specified in the application for registration or 90 days from the effective date of registration, whichever is earlier. However, the proper officer, at the request of the said taxable person, may extend the validity of the aforesaid period of 90 days by a further period not exceeding 90 days.
Can the Department, through the proper officer, suo-moto proceed to register a person? (Posted On: 28 May, 2020)

Yes. In terms of sub-section (8) of section 25, where a person who is liable to be registered under GST law fails to obtain registration, the proper officer may, without prejudice to any action which may be taken under CGST Act, or under any other law for the time being in force, proceed to register such person in the manner as is prescribed in the CGST Rules, 2017.
Can a Non-resident taxable person obtain registration even if he does not possess PAN? (Posted On: 28 May, 2020)

A Permanent Account Number is mandatory to be eligible for grant of registration. One exception to this is a non-resident taxable person. A non-resident taxable person may be granted registration on the basis of other prescribed documents instead of PAN. He has to submit a self-attested copy of his valid passport along with the application signed by his authorized signatory who is an Indian Resident having valid PAN and application will be submitted in a different prescribed form [Section 25(6) & (7)].
An unregistered supplier under GST wants to claim input tax credit and collect tax. Can it do so? (Posted On: 28 May, 2020)

No, he cannot claim input tax credit and collect tax. A person without GST registration can neither collect GST from his customers nor can claim any input tax credit of GST paid by him. However, if he wants to claim input tax credit and collect tax, he can apply for voluntary registration under section 25(3) of CGST Act, 2017.
A flying school imports an aircraft for use in its training activity, and takes ITC of the IGST paid on the import. Is ITC allowed on conveyances? (Posted On: 28 May, 2020)

Under section 17(5) of the CGST Act, ITC is allowed on aircraft if they are used to make the taxable supply of imparting training on flying an aircraft. Therefore, the credit is correctly taken.
When can the principal directly supply goods from the premises of job worker without declaring the premises of job worker as his additional place of business? (Posted On: 27 May, 2020)

Ans: The goods can be supplied directly from the place of business of job worker without declaring it as additional place of business in two circumstances namely where the job worker is a registered taxable person or where the principal is engaged in supply of such goods as may be notified by the Commissioner.
How can we get the refund of advance tax deposited by us as casual taxable person under section 27(2) of the CGST Act, 2017? (Posted On: 27 May, 2020)

Ans.The amount of advance tax deposited by a casual taxable under section27(2), shall be refunded only when such person has, in respect of the entire period for which the certificate of registration granted to him, remained in force, furnished all the returns required under section 39 [Section 54(13)]. Further, refund of any amount, after adjusting the tax payable by the applicant out of the advance tax deposited by him under section 27 at the time of registration, shall be claimed in the last return required to be furnished by him.
I wanted to add an additional place of business and that place belongs to distant relative who is not registered in GST. Is it allowed to do so? (Posted On: 27 May, 2020)

Ans. Yes sir you can add that place as additional place of business by amending your GST registration.
Will I be required to pay GST on rent even if I have not received it during the lockdown period. (Posted On: 27 May, 2020)

Ans. Many experts are of the opinion that as you have to raise invoice as per the agreement every month and so GST is to be paid on the output service provided. The practical solution possible is amending the agreement as per the convenience of the tenant and the landowner and the modification made can be intimated through email to the other person.
1. We are raising invoices at the applicable tax rate of GST and later, credit notes are issued against the invoices to customers for below mentioned reasons- 1. Rate difference. 2. Cash discount or sales discount 3. Freight outwards. What is the correct method of issuing credit or debit note in GST? Whether GST should be adjusted against such issuance or not? (Posted On: 27 May, 2020)

Ans. Rate difference: In this case, we are required to issue debit note and credit giving GST effect for rate difference to buyer. Cash discount or sales discount:In this case, if the discount is pre-decided in the agreement done or known at time of supply of goods or service, the supplier can raised credit notes with GST and correspondingly, input tax credit will be reversed by buyer. Freight outward: According to clause (c) of sub-section (2) of Section of 15 CGST Act, the incidental expenses are to be included in value of supply of goods. We are required to include the above freight amount in cost of goods. The GST amount is applicable on the said amount according to clause (c) of sub-section (2) of Section 15 of CGST Act
In case of refund under exports of goods, whether BRC/FIRC is necessary for granting refund? (Posted On: 26 May, 2020)

Ans: In case of refund on account of export of goods, the refund rules do not prescribe BRC/FIRC as a necessary document for filing of refund claim. However, for export of services details of BRC/FIRC is required to be submitted along with the application for refund.
Is there any time limit for sanctioning of refund under section 54 of the CGST Act,2017? (Posted On: 26 May, 2020)

Ans: Yes, refund has to be sanctioned within 60 days from the date of receipt of application complete in all respects. If refund is not sanctioned within the said period of 60 days, interest @ 6% p.a. will have to be paid in accordance with section 56 of the CGST/SGST Act. However, in case where provisional refund to the extent of 90% of the amount claimed is refundable in respect of zero-rated supplies made by certain categories of registered persons in terms of sub-section (6) of section 54 of the CGST/SGST Act, the provisional refund has to be given within 7 days from the date of acknowledgement of the claim of refund.
Sir, Hope everything is fine at your end. My issue is that I booked a flat & paid instalment up to 30-6-17. Renaming amt Rs 1100000/- for which the builder is demanding including GST @12 percent, Service tax @ 4.5 percent on the cost of the Flat. After implementation of gst nobody can demand service tax. Should I have to pay Service tax or not? (Posted On: 26 May, 2020)

Ans. Service Tax cannot be demanded by the builder after GST has been implemented. You are required to pay GST on the remaining amount and the builder needs to raise invoice charging GST.
Sir, Hope everything is fine at your end. My issue is that I booked a flat & paid instalment up to 30-6-17. Renaming amt Rs 1100000/- for which the builder is demanding including GST @12 percent, Service tax @ 4.5 percent on the cost of the Flat. After implementation of gst nobody can demand service tax. Should I have to pay Service tax or not? (Posted On: 26 May, 2020)

Ans. Service Tax cannot be demanded by the builder after GST has been implemented. You are required to pay GST on the remaining amount and the builder needs to raise invoice charging GST.
I am consultant engaged in filing of EPF, TDS, ROC filing and other compulsory forms required to be filled under Companies as well Income Tax Act. While filing forms, Government charges GST on the fees paid to them. So, while billing to the client, I levy GST on the consultancy charges including the fees and GST charged by the government on fees paid. Is this the correct method of charging the GST? (Posted On: 26 May, 2020)

Ans- To make it simpler, for eg while making roc fees payment to government on behalf of client, the government charges 1000Rs+GST @ applicable taxes. So, the invoice raised to client by you includes the consultancy say Rs. 500 + {1000+ GST paid on the government} and on this wholesome figure, you charge GST @ 18%. In this scenario, you are unduly increasing the cost of client by charging tax on the GST paid to government along with the fees. The client has authorised you to incur expenditure of his behalf for making the payment of fees to the government. In this scenario, expenses incurred i.e. 1000+GST paid to Government should not form part of value of consultancy services. Pure agent is one who while making supply to the recipient also incurs and receives expenditure on the supply made on behalf of principal(Rule 33 of the CGST Rules,2017). The correct method of raising the invoice is charging GST only on consultancy charges @ 18% and fees paid along with GST should be reimbursed from the client without any additional tax payment.
I have supplied my product to the customer @ 100 each. However, due to the some deficiency in product quality, the customer has deducted Rs. 10 and returned the product at a reduced price of Rs 90 each. Is this possible? Is there any method of valuing the returned goods in GST law? (Posted On: 26 May, 2020)

Ans. Yes sales return can be made @ Rs. 90/- per product and there is no provision for sales return valuation in GST. Further, while filing GSTR 1, Portal only links the original invoice number and date with the credit note issued regardless of the price at which supply is made. However, credit note cannot be more than the invoice value . Alternatively a sale invoice can also be issued by the receiver @ 90.
What is the place of supply of services by way of transportation of goods, including mail or courier when the both the supplier and the recipient of the services are located in India? (Posted On: 25 May, 2020)

If the recipient is registered, the location of such person is the place of supply. However, if the recipient is not registered, the place of supply is the place where the goods are handed over for transportation [Section 12(8)]. A new proviso has been inserted in this sub-section to lay down that where the transportation of goods is to a place outside India, the place of supply shall be the place of destination of such goods. Therefore, in case where the location of supplier and recipient is in India and goods are transported to a place outside India, the place of supply of transportation service shall be the place of destination of such goods, i.e. outside India.
An individual is a referee in a football match organized by Sports Authority of India. He is also a referee in another charity football match organized by a local sports club, for lump sum payment. Whether he is required to pay any GST? (Posted On: 25 May, 2020)

Services provided to a recognized sports body by an individual inter alia as a referee in a sporting event organized by a recognized sports body is exempt from GST. Since in the first case, the football match is organized by Sports Authority of India, which is a recognized sports body, services provided by the individual as a referee in such football match will be exempt. However, when he acts as a referee in a charity football match organized by a local sports club, he would not be entitled to afore-mentioned exemption as a local sports club is not a recognized sports body and thus, GST will be payable in this case.
In case where sponsorship services are provided by a company to an individual, then who is liable to pay GST. (Posted On: 25 May, 2020)

GST on sponsorship services provided by any person to any body corporate or partnership firm located in the taxable territory is payable under reverse charge. Since in the given case, services have been provided to an individual, reverse charge provisions will not be attracted. GST is payable under forward charge by the supplier – company.
Goods were sent for jobwork and were not received back in one year. So the principal raised invoice for goods sent for jobworkas per the provisions of Section 143 of CGST Act. Can the jobworker claim credit. (Posted On: 25 May, 2020)

Yes the jobworker can claim credit as it would be considered as deemed supply from the viewpoint of principal. Circular No. 38/12/2018 dated 26.03.2018 had been issued giving clarification on issues related to job work. The relevant portion is being reproduced below “Thus, if the inputs or capital goods are neither returned nor supplied from the job worker’s place of business / premises within the specified time period, the principal would issue an invoice for the same and declare such supplies in his return for that particular month in which the time period of one year / three years has expired. The date of supply shall be the date on which such inputs or capital goods were initially sent to the job worker and interest for the intervening period shall also be payable on the tax. If such goods are returned by the job worker after the stipulated time period, the same would be treated as a supply by the job worker to the principal and the job worker would be liable to pay GST if he is liable for registration in accordance with the provisions contained in the CGST 11 Act read with the rules made thereunder.”
Sir I have filed refund application and Deficiency memo is being issued. This process is being repeated again and again. Now they have rejected on the basis that the refund application is being time barred. Can you guide on what is to be done now. (Posted On: 25 May, 2020)

In our opinion, the time period is to be seen when the original refund application was filed. There have been many case laws in erstwhile Central Excise regime stating that the date of filing of refund shall be the date of original filing of return. But in the GST regime as per the provisions of Rule 90, acknowledgement in FORM GST RFD-02 shall be made available to the applicant indicating the date of filing of the claim for refund and the time period specified in sub-section (7) of section 54 shall be counted from such date of filing. But in case where deficiency memo is issued RFD-03 is issued and unless and until RFD-02 is issued the refund application shall not be valid. There is bound to be litigation on this issue between you and the department.
If the goods having e-way bill has to pass through trans-shipment and through different vehicles, how it has to be handled? (Posted On: 23 May, 2020)

Some of the consignments are transported by the transporter through transshipment using different vehicles before it is delivered to the recipient at the place of destination. Hence for each movement from one place to another, the transporter needs to update the vehicle number in which he is transporting that consignment in part B of the E Way Bill.
How many times can Part-B or Vehicle number be updated for an e-way bill? (Posted On: 23 May, 2020)

A user can update Part-B (Vehicle details) as many times as he wants for movement of goods to the destination. However, the updating should be done within the validity period.
Anyone facing issue for filing gstr 9 for f. y. 2018-19 where gstr 9 was not filed for f. y. 2017-18 due to option provided for non-filing (Posted On: 23 May, 2020)

Sir though filing of GSTR-9 had been made optional for few taxpayers in 2017-18 but yet due to the technical glitches on the portal many taxpayers who have to file their return for 2018-19 are forced to file the return of 2017-18 first as the portal does not allow to file the return for next year unless the previous years is filed. So this leads to cost to the taxpayer as they have to pay late fees. We have made presentations to the government for solving this.
In which table of gstr 9 would be shown the itc received in fy 17-18 but availed in fy-18-19 , for the preparation of gstr 9fy 18-19 (Posted On: 23 May, 2020)

No such column specified till date, will form of part of reconciliation in table 13 of GSTR 9c
can made a sales return(goods) below the sales price(price in the sales invoice)i.e is it compulsory to made a sales return with its actual sales value. there is any provision for sales return valuation in gst. eg. Made sales of 10Nos * Rs.100/Nos. 2 Nos of it can return with Rs.90/- (2nos*Rs.90) Siby Jose (Posted On: 23 May, 2020)
Mr. A, a registered person was paying tax under Composition Scheme up to 30th July. However, w.e.f. 31st July, Mr. A becomes liable to pay tax under regular scheme. Is he eligible for ITC? (Posted On: 22 May, 2020)

Mr. A is eligible for ITC on inputs held in stock and inputs contained in semi-finished or finished goods held in stock and capital goods as on 30th July. ITC on capital goods will be reduced by 5% per quarter or part thereof from the date of invoice [This is as per Section 18(1)(c)].
A technical testing agency tests and certifies machine tools before dispatch by BMT Ltd. Some of these tools are dispatched to a unit in a SEZ without payment of GST as these supplies are not taxable. Whether BMT Ltd. needs to carry out reversal of ITC on the testing agency’s services to the extent attributable to the SEZ supplies. (Posted On: 22 May, 2020)

Under section 16(2) of the IGST Act, credit of input tax is allowed to be taken for inward supplies used to make zero rated supplies. Under section 17 of the CGST Act also, ITC is disallowed only to the extent it pertains to supplies used for non-business purposes or supplies other than taxable and zero-rated supplies. Supplies to SEZ units are zero rated supplies in terms of section 16(1) of IGST Act. Thus, full ITC is allowed on inward supplies of BMT Ltd. used for effecting supplies to the unit in the SEZ.
As per proviso of Section 16(2) of CGST Act if a recipient fails to pay consideration to supplier within 180 Days from the date of issue of invoice, then ITC already availed shall be reversed with interest. But if a recipient suo moto reversed the ITC before completion of 180 days from the date of issue of invoice on the grounds of Non-payment. Shall interest be levied on such reversal of ITC before 180 days u/s 50? (Posted On: 22 May, 2020)

In this case, the receipient is not liable to make payment of interest as he has already reversed the credit before completion of 180 days.
We've dispatched material with invoice @ 0.1 % IGST which we now want to change to 18 % IGST. What is to be done now. (Posted On: 22 May, 2020)

Sir a debit note for the difference tax rate that is @ 17.9% is to be raised. Further an intimation to the department is also to be given that the goods are to be dispatched at 18%. We have not intimated department on supply of goods @ 0.1% as per notification No. 40/2017 dated 23.10.2017.
Sir I have sent goods to be exported via flight from Delhi. But due to lockdown the flights were cancelled and goods were sent back to Jaipur. The E-way bill was generated earlier in march. Now what is to be done. (Posted On: 22 May, 2020)

Assuming that the E way bill has expired and is not covered under the notification issued for deemed extension of E-way bills as stated by you that the E-way bill was generated in the earlier march a new E-way bill is to be generated on the basis of new invoice. Further Credit note is to be issued for the former invoice. We should write a letter narrating all facts to the department.
Dear Sir, Instead of IGST against a tax invoice related to FY 2018-19, I have booked ITC under CGST and SGST. This mistake identified later on in March 2020. Now I have reversed the excess credit taken under CGST & SGST. But Sir my question is that, can I avail the credit of IGST now in March 2020 GSTR-3B return?? If not then can I claim refund of IGST as such is reflecting in my GSTR-2A and earlier was mere a mistake. (Posted On: 21 May, 2020)

As per the Section 16(4) of the CGST Act,2017, the time limit for taking input tax credit for the financial year 2018-19 is up to the filing of return (GSTR-3B) for the month of September 2019 or or up to the filing of relevant annual return, whichever is earlier. The due date of filing of GSTR-3B for the month of September 2019 is 20th of October 2019.
I am a hotel owner providing accommodation in Haryana, through an electronic commerce operator. I am not liable to get registered under GST. Then who is the person liable to pay GST in this case? What if the Electronic Commerce Operator does not have a physical presence in India? (Posted On: 21 May, 2020)

Government may notify [on the recommendations of the GST Council] specific categories of services the tax on intra-State supplies of which shall be paid by the e commerce operator if such services are supplied through it. Services by way of providing accommodation in hotels through e commerce operator is a specified service for said purpose except where the person supplying such service through electronic commerce operator is liable for registration under section 22(1) of the CGST Act. Thus, person liable to pay GST in this case is the E Commerce Operator. All the provisions of the GST law shall apply to such e commerce operator as if he is the supplier liable for paying the tax in relation to the supply of such services. If E Commerce operator does not have a physical presence in India, person liable to pay tax is the person representing the E Commerce Operator for any purpose in India.
My company have 100% exports. In April 2020 month, company has no domestic sales and has only export with payment of duty. We correctly uploaded details in GSTR-1 in table 6A But while filing GSTR-3B, we wrongly filled exports details in table 3.1 (a) (In outward taxable supply) instead of table 3.1 (b) (Zero rated supply) due to which export shipping bill data has not been transmitted to ICEGATE and refund is not credited to their respective bank accounts. What is solution? Company do not have domestic sale to adjust in next month 3B. (Posted On: 21 May, 2020)

Department has issued a detailed circular No. 26/26/2017=GST dated 29-12-2017 giving instructions to correct errors made in filing GSTR-3B. So, any adjustments, rectifications related to previous months would be done in the subsequent month in GSTR 3B. Since company already declared that they won’t be having any domestic sales in next month so reducing the domestic sale and increasing the export sales couldn’t be implemented while filing 3B for the next month. There is no legal procedure for the same. In our opinion, you should declare the export sales of April 2020 in May 2020 in 3.1(b) and avail the credit of the wrong tax paid in 3B return. To be safer side, you should write to the department.
Sir, I have made B2C supply in the month of May 2020. Please tell me the procedure to prepare the e way bill in case of supply to unregistered person/ consumer by a registered person? (Posted On: 21 May, 2020)

Supplier, Receivers, and Transporters who are registered with GST system and possess a GST identification number (GSTIN) can register themselves with E-way Bill System using their GSTIN. While generating e way bill, ‘URP’ needs to be mentioned where the counterparty (either the supplier or receiver) is an unregistered person in the GSTN field Name is not a mandatory field, but it is recommended to mention the trade or legal name of the unregistered party. Address, state and PIN code are required to be updated as it is.
Sir, I am registered person in GST. While filing GSTR 3B for the month of March 2020, I have mistakenly paid IGST instead of CGST and SGST in column 3.1(a). However, I have correctly charged CGST/SGST on the invoice. Now what is the remedy? (Posted On: 21 May, 2020)

Sir, as per the Section 77(2) of the CGST Act, 2017 read along with the section 19(2) of the IGST Act,2017, if the person mistakenly pays tax in the wrong head, he shall not be liable to pay interest on the amount of wrong tax deposited. Hence, no interest is payable by you. Therefore, while filing GSTR 3B for the month of April, 2020, you are suggested to pay the correct tax in CGST and SGST head in same column. Once the correct tax has been paid to the Government, the supplier should apply for refund of the wrong Integrated Goods and Services Tax paid.
Whether goods supplied on hire purchase basis will be treated as supply of goods or supply of services? Give reason. (Posted On: 18 May, 2020)

Supply on hire purchase shall be treated as supply of goods as there is transfer of title, albeit at a future date.
I am registered dealer at Ahmedabad. I intend to purchase material from Jaipur and despatch therefrom to New Delhi under my sale bill? How to do that? (Posted On: 18 May, 2020)

Invoice is to be raised by Ahmedabad party to Delhi party. The e-way bill is to be prepared by Ahmedabad party. In this e-way bill, his address of Ahmedabad will come automatically. In this e-way bill, in column “dispatch from”, write Jaipur address and in the column “Bill to” address of New delhi will come.
Sir invoice and E-way bill were both prepared on 21.03.2020 and the goods were to be dispatched but due to lockdown the goods were not dispatched and the E-way bill couldn’t be cancelled. And now the goods are not to be sent at all. What is the remedy now? (Posted On: 18 May, 2020)

We would suggest that please inform the department officials in writing that the goods were not dispatched and E-way bill was prepared which was not cancelled. Further Credit note is to be prepared as the goods are not to be sent.
When can an assessee apply before settlement commission under Customs (Posted On: 18 May, 2020)

Where any proceeding under Customs Act, 1962 for the levy, assessment and collection of Customs duty is pending before an adjudicating authority on the date on which an application is made, application can be filed before Settlement Commission. However, when any proceeding is referred back in any appeal/ revision, by any court, Appellate Tribunal or any other authority, to the adjudicating authority for a fresh adjudication/ decision, then application of settlement of such proceeding cannot be filed before Settlement Commission.
Hello sir I am selling PPE kit which falls under readymade garments. Suppose I sell at the rate of Rs. 750 to dealers but on the MRP it is written as Rs.1250/-. Then what shall be the rate of tax that is whether it will be decided on the basis of MRP? (Posted On: 18 May, 2020)

As per serial number 222 f notificiation number 1/2017, the GST @ 5% is applicable on “Articles of apparel and clothing accessories, knitted or crocheted, of sale value not exceeding Rs. 1000 per piece” at the rate of tax of 5%. As the notification uses the term sale price, hence it is to be considered and MRP is not to be considered. As the article’s price sold by you is below Rs. 1000/-,5% will be applicable.
Sir We have received an amount of Rs. 1,00,000/- for tools and dyes developed for a particular order. We have an agreement with the party that they will provide an order of say 50 tonnes within a span of two years. Otherwise, the amount so deposited will be forfeited. If the order of that particular quantity is given in a span of two years then the amount of Rs. 1,00,000/- so received will be refunded. Is there any GST implication? (Posted On: 16 May, 2020)

No sir there is no GST payable at the time of receipt of advance as the amount received by you is considered is as security deposit. If you refund also, then also there is no implications. But if you forfeit the same then bill is to be raised and GST is to be paid on the same.
Continuing with the above situation, the agreement also contains that if only if part order is received out of total quantity in agreement then the proportionate amount is to be forfeited. Suppose, in above question, if 25 tones of order is given in 2 years then only 50% amount is to be refunded and balance is to be forfeited. Now is there any tax effect on this. (Posted On: 16 May, 2020)

Yes sir. In this case, as there is an agreement that the proportionate amount shall be forfeited if part order is received then forfeited amount shall fall under Schedule II of CGST Act 2017. It will fall under the relevant clause of “agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act”. There is a need to raise invoice on the amount forfeited and GST is payable. But there will not be any GST liability on amount refunded.
Is there any time period for issuing Credit notes under GST. I want to issue credit note for the 2018-19. Is it possible. Suppose, I have provided the service and amount is also received along with GST. The invoice was also raised and tax was paid. After two years, we have to raise the credit note. Whether we can get our GST back. (Posted On: 16 May, 2020)

As per Section 34(2) of CGST Act 2017 “Any registered person who issues a credit note in relation to a supply of goods or services or both shall declare the details of such credit note in the return for the month during which such credit note has been issued but not later than September following the end of the financial year in which such supply was made, or the date of furnishing of the relevant annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as may be prescribed” So as per the provisions, credit note is to be issued in September or the date of furnishing of annual return whichever is earlier. As per your query credit note is to be raised after two years then we cannot give effect of tax as time limit given has already expired. Only financial credit note (without tax effect) can be issued.
We filed for GSTR 3B for March 2020. Now we received Bills for freight outward expenses. How will we pay reverse charge for these Bills. Whether pay in April 2020 GSTR 3B or not. Please suggest so that we comply to rules. (Posted On: 16 May, 2020)

Time of Supply are governed under Section 12 of CGST Act 2017. The relevant portion of Section 13(3) of CGST Act 2017 is as follows:- “In case of supplies in respect of which tax is paid or liable to be paid on reverse charge basis, the time of supply shall be the earlier of the following dates, namely:–– (a) the date of payment as entered in the books of account of the recipient or the date on which the payment is debited in his bank account, whichever is earlier; or (b) the date immediately following sixty days from the date of issue of invoice or any other document, by whatever name called, in lieu thereof by the supplier: Provided that where it is not possible to determine the time of supply under clause (a) or clause (b), the time of supply shall be the date of entry in the books of account of the recipient of supply” So as per the provisions liability to pay tax on reverse charge basis shall arise from the date of payment as entered in the books of accounts. So if entry is made in the books in the month of April 2020 then you can pay tax under RCM while filing the return of April 2020 and the credit of the same can be taken in the same month.
Can I take credit which was missed pertaining to the period 2018-19. (Posted On: 15 May, 2020)

Credit for the period 2018-19 could be taken before September 2019 or furnishing of Annual return whichever is earlier. So you are not eligible to take credit pertaining to 2018-19.
Can you please clarify on recent circular issued on Insolvency Bankruptcy code. (Posted On: 15 May, 2020)

The circular clarified regarding obtaining of registration after the appointment of IRP and what if there is a change in the IRP/RP. Please refer to our update “GST Update on Clarification on certain issues related to Companies under IBC under GST Law vide Circular No. 138 /08/2020 dated 6th May 2020” published on our website for more understanding.
I have a query regarding E way bill. I have sent the goods along with the required documents that is invoice and E way bill. But the E-way bill has expired while the goods were in transit. I was unable to extend the validity of E way bill and this E way bill was generated on 25.04.2020 and expired on 02.05.2020. what is the solution. (Posted On: 15 May, 2020)

As per the dates mentioned by you the validity of the E way bill doesn’t seem to be stand extended to 31.05.2020 as the recent notification No. 40/2020-central tax. For further reference please refer to “GST Update on extension of validity of E-way Bills 33/2020-21” published on our website www.capradeepjain.com. In this we would suggest to issue credit note for the current invoice and prepare a new E-way bill on the basis of new invoice.
Sir I have prepared E way bill and when the goods were sent out of the factory premises. We came to know that the goods were not to be delivered. What is to be done now. (Posted On: 15 May, 2020)

In this a credit note is to be prepared and a new E way bill is to prepared on the basis of credit note to bring back the goods from where they are to factory premises. In sub type, “Sales return” is to be selected.
Hello sir, I have obtained Drug License and want to manufacture Sanitizers. What shall be the chapter for sanitizer. (Posted On: 15 May, 2020)

Sir the entry shall fall under chapter heading No. 30. It will medicament as you are having dug licence and manufacturing it. Even we have seen bills of certain drug manufacturer and it falls under the same.
Can I amend GSTR-3B? (Posted On: 14 May, 2020)

No, there is no such facility to amend GSTR-3B.
Sir is RCM applicable on director’s remuneration. (Posted On: 14 May, 2020)

There are two advance rulings which I would like to state one is M/s Clay Crafts India Pvt ltd. (Rajasthan AAR) in which it was ruled that yes RCM is applicable on director’s remuneration. And the other is M/s Anil Kumar Agarwal (Karnataka AAR) in which contrary ruling was given stating that RCM is applicable on amount received by the director in the capacity of Non-executive director. But on amount received in the capacity as Executive director RCM is not applicable as he shall be treated as an employee of the company.
Sir I have a query regarding export of goods both under LUT and on payment of duty in the same month. Is this permissible? (Posted On: 14 May, 2020)

Yes sir it is. There is no bar on this. Export can be done using both LUT and on payment of tax.
If bill has been raised in dollar terms on Foreign buyer and the exchange rate was taken as Rs. 65/- and if I issue credit note then will the exchange rate applicable for credit note also be Rs. 65/-. (Posted On: 14 May, 2020)

Yes sir the exchange rate applicable for credit note shall also be at Rs.65/-.
Please suggest how to change bank account number for non receipt of IGST refund on export. In fact we have received refund from april 2019 to September 2019 & after that from October to Feb 2020 we haven't received refund due to wrong bank account number mentioned by custom. Scroll sanction status generated successful on icegate but rejected by bank due to account number. How to change the same? Bhakti M Gadave (Posted On: 13 May, 2020)

In this we would like to say that to suggest to write a letter to the port authorities from where export was made or shipping bill was generated that ‘we have been receiving refund for the period April to September 2019 but have not received for the period October to Feb 2020 due to the error mentioned as wrong account number. So please update our bank account details in your system which is being enclosed herewith.’ Please do enclose a copy of cancelled cheque as well.
I have receipt an advance prior to implementation of GST and no sale is made on that advance neither the other person is keen about the supplies or about taking back the advance. Now I am writing off this advance in my books. Will GST be applicable? (Posted On: 13 May, 2020)

Ans. No sir GST will not be applicable on this advance as it is received prior to implementation of GST.
In case of supply of lime stone @ Rs.450 per tonne, Gst @ 5% is applicable. Now, transportation for the same is Rs.1000 per tonne, whether Gst is applicable at 12/18%; the principal supply is of limestone. (Posted On: 13 May, 2020)

Ans. The price of transportation being higher than the price of principal supply of goods does not change the principal supply of goods in a composite supply. As supply of goods and transportation charges are composite supply even defined under definition of “composite supply”. Without the limestone supply, there is no meaning or importance of a separate transportation, which is useless. The GST rate as applicable on the supply of limestone shall be the applicable GST rate i.e. 5%.
A person is engaged in IT training programmes to Government aided Secondary and Higher Secondary Schools to implement the training projects for Government-aided Schools. Whether the applicant is liable to pay GST? (Posted On: 13 May, 2020)

Ans. This shall be covered under Entry No. 72 of Notification No. 12/2017 dated 29.06.2017, the relevant portion of which is shown as follows “Services provided to the Central Government, State Government, Union territory administration under any training programme for which total expenditure is borne by the Central Government, State Government, Union territory administration. Rate Nil ————–Condition Nil”
There is a registered person who is proprietor of trading business. He died and his son wants to continue the business of the deceased father. What is to be done. (Posted On: 13 May, 2020)

Ans. Sir in this case, son is required to get himself registered under the name of the restaurant but using his own PAN and file FORM ITC-02.
XYZ (India) offering services of product development, analytical method development, partial analytical method validation and technology transfer services to the client’s designated manufacturing site for its Associate Company PQR, Singapore (A separate legal entity). The services will be used by Associate Company in relation to product to be sold in US market. For this purpose, XYZ is raising Debit Note on PQR towards ‘Service charges’ in foreign currency. Is XYZ liable to pay GST on it? Kaustubh Ram Karandikar (Posted On: 13 May, 2020)

Ans. Yes XYZ is liable to pay GST as this transaction shall be considered as “Export of Services” as per section 2(6) of IGST Act 2017 as all the conditions are getting satisfied which are as follows “export of services means the supply of any service when,–– (i) the supplier of service is located in India; (ii) the recipient of service is located outside India; (iii) the place of supply of service is outside India; (iv) the payment for such service has been received by the supplier of service in convertible foreign exchange; and (v) the supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in section 8;” As supplier and recipient of service are mere establishment of a distinct person, hence it will not be termed as export of services.
Hello sir, what is the due date for filing GSTR-9 & 9C for the year 2018-19 (Posted On: 12 May, 2020)

Notification no. 41/2020-Central Tax dated 05.05.2020 has been issued stating that the due date for filing of GSTR-9 shall be 30.09.2020 for furnishing of annual return. The reconciliation statement can be filed only when annual return is filed. Hence, the last date of filing of reconciliation statement is also extended to 30/09/2020. We have also prepared an update for this purpose.
When the tax invoice is raised and goods are also sent. Only the Part-A is filled of E-way bill and now goods have been returned back. Whether E way bill is to be prepared? (Posted On: 12 May, 2020)

Credit note is to be prepared on return of material as per Section 34 of CGST Act. E way bill is to be prepared on the basis of credit note. With respect to the generation of E way bill we would like to reproduce the relevant portion of proviso to Sub rule 3 of Rule 138 of CGST Rules which is as follows “Provided also that where the goods are transported for a distance of upto fifty kilometers within the State or Union territory from the place of business of the consignor to the place of business of the transporter for further transportation, the supplier or the recipient, or as the case may be, the transporter may not furnish the details of conveyance in Part B of FORM GST EWB-01.” Sir here part B of E way is not required if goods are sent from factory to transporter’s premises. But the exception is not given when goods are returned by transporter to factory. E-way bill is required if goods received from transporter’s premises to factory premises irrespective of the distance.
Section 122(1)(vii) provides for penalty for taking the ITC. Section 122(2) also provides for penalty for wrong availment of ITC. Under which situation 122(1) will get attracted under which situation 122(2) will get attracted? Kaustubh Ram Karandikar (Posted On: 11 May, 2020)

Section 122(1)(vii) deals with specifically with the taking or utilisation of Input tax credit without actual receipt of goods or services or both. But Section 122(2) deals with wrong availment or utilisation of Input tax credit. Suppose if credit is taken of blocked credits specified in section 17(5) or if credit is not availed as per the provisions of Rule 36(4) of CGST Rules 2017 then it shall lead to Section 122(2) of CGST Act 2017.
What is the GST implication for latest roof top solar power plants installation including designing, engineering and installation? Whether this is a composite supply (Posted On: 11 May, 2020)

As per Notification No. 24/2018 dated 31.12.2018 will apply to the above question. The supply shall be a composite supply. 70 percent of value of invoice raised shall be subjected to 5 percent and balance 30 percent shall be subject to 18 percent.
Sir, I have filed my gstr3b for the month of march 2020. I have by mistake taken a debit note (purchase return) as purchases in my Gstr 3B. How to file my next 3B and get the same rectified. Please suggest. (Posted On: 11 May, 2020)

While filing the return of April 2020 the same is to be rectified by reducing the Input tax credit of the current month twice by the amount of purchase return.
Sir, I have missed out one sales invoice while calculating and filing GSTRB in June, 2019. However, I filed the GSTR1 for the first quarter including that missed invoice. There was no indication while filing the GSTR1 that the total tax paid is less and any balance payable. I have now filed subsequent months and quarters GSTR3Bs and GSTR1 including that of March, 2020. Now the total of all GSTR1s is higher than the total of all GSTR3Bs. The GSTR1 totals are actually correct. How can I rectify now? (Posted On: 11 May, 2020)

In such a case, you are required to report the missing sales in the GSTR3B for the month of April 2020. Further you also have to deposit interest from the date the sales were made till the date of payment.
If invoice is received in January and goods are received in February, when will ITC be available to the recipient and when the tax need to be paid by the supplier (Posted On: 11 May, 2020)

ITC would be available in the month of February as there is a pre-condition that ITC will not be available unless the goods have been received by the recipient. This is as per the provisions stated in section 16 of the CGST Act Also, as per time of supply provisions, the supplier shall pay the output tax, being earlier of issue of tax invoice or receipt of payment.
Taxable figure wrongly entered in gst 3b but tax is right. As it’s a quarter return in gst r1 all figures are considered right. What’s a solution (Posted On: 11 May, 2020)

In such a case, you can adjust the taxable value in the next month’s GSTR-3B (reverse the impact).
dear sir, I have a stone crusher business and it have many ITC related to RCM and I want to claim. how can I do claim for ITC. MANISH DEWANGAN (Posted On: 11 May, 2020)

If ITC is related to the year 2017-18 and 2018-19, then credit cannot be claimed. But if the ITC relates to the current financial year then it can be claimed in “Inward Supplies liable to Reverse charge” in table 4 of GSTR-3B if your outward supply is liable to GST.
For Import on FOB,If said freight is initially paid by Indian CHA or Indian freight forwarder to the foreign shipping line and then recovered from importer, whether importer liable to pay GST under reverse charge? (Posted On: 10 May, 2020)

The importer is not liable to pay GST under Reverse Charge Mechanism. It is applicable only when foreign supplier has paid the freight to foreign shipping line then importer has to pay GST under RCM.
Sir if I am located in one state and have given property on rent in other state, then what is to be charged CGST & SGST or IGST. (Posted On: 09 May, 2020)

If you are registered in one state and property is situated in another state and you do not have principal place of business in other state, then there is no need of registration in other state. In this case, IGST is to be charged as the place of supply in the case of immovable property is where the immovable property is situated but supplier is located in other state. Hence , IGST is to be charged on inter-state supply.
Sir I was a risky exporter and the flag of risky exporter. The physical verification and audit is conducted by CGST department. The report is also sent to custom department and red flag has been removed from the ICD- CONCOR, Jodhpur and ICD-Thar dry port, Jodhpur. But it is not being removed from NHAVA SHEVA port. What shall I Do? (Posted On: 09 May, 2020)

In this case, it is requested to write a letter to CGST department to send their report to NHAVA SHEVA port as well. So that the flag gets removed.
Within how many days is ITC-01 to be filed? (Posted On: 09 May, 2020)

Sir the statement in form ITC-01 is to be filed within 30 days from the date from which the option is withdrawn or from the date of Order passed in Form CMP-07.
A dealer paying Tax on composition scheme becomes a regular taxable person. Can he avail ITC and if so from what date? (Posted On: 09 May, 2020)

As per Sec 18(1) (c) when registered person cease to pay tax u/s 10 then he can avail ITC in respect of inputs held in stock and inputs contained in Semi-finished or finished goods held in stock and on capital goods on the day immediately preceding the date from which he becomes liable to pay tax. He has to file ITC-01 for this purpose.
If A is registered in Mumbai and B is registered in Delhi. B comes to A’s shop and purchases the goods and delivers them to Delhi. What is to be charges CGST and SGST or IGST? (Posted On: 08 May, 2020)

IGST is to be charged because as per section 10(1)(a), “where the supply involves movement of goods, whether by the supplier or the recipient or by any other person, the place of supply of such goods shall be the location of the goods at the time at which the movement of goods terminates for delivery to the recipient”. It states that movement can be caused either by supplier or recipient.
An IIT coaching center gives tablet to each student. Whether itc available? Whether answer changes if tablet given to top 5 students? (Posted On: 08 May, 2020)

Sir in the first case the ITC shall be available as it is provided to all the students and it is obvious that it has not been given free but has been included in the fees collected from the student. In the second case, if tablet is given only to top 5 students then ITC shall not be available as it is gift under section 17(5)(h).
Sir I had issued E way bill and filed Part B and the goods were sent at a few meters outside the factory. We came to know that the receiver said that he shall not accept the goods. What can be done? (Posted On: 08 May, 2020)

Sir in this case you are required to issue Credit note and cancel the E way bill if it has not been beyond 24 hours. And further the receiver can reject the E way bill within 72 hours.
Whether itc on normal loss required to be reversed? (Posted On: 08 May, 2020)

No, ITC on normal loss is to be reversed. Because as per Section 17(5)(h) relating to blocked credits, it states as ‘goods lost’. Here the term usedis“good lost” which is different from “normal loss”.
If gift to employees is more than 50,000 whether itc available to employer. For eg- employer gifted laptop to employee on Diwali. Whether itc available? (Posted On: 08 May, 2020)

As per Schedule 1 of CGST Act 2020, it shall be treated as supply. If tax on output supply is paid then credit shall be available.
Has the time limit of exporting within 90 days for merchant exporters also being extended? (Posted On: 07 May, 2020)

Yes sir as per Circular No. 138/08/2020-GST dated 06.05.2020 has clarified that this compliance has also been extended which falls during the period 20.03.2020 to 29.06.2020 to 30th June 2020. It is also been clarified that this relaxation is applicable as above notification also falls under the Notification No. 35/2020-Central tax dated 03.04.2020.
Sir I have query regarding two E-way Bills issued a. One E-way bill was issued and its validity expires before 20.03.2020 and has been stuck on the way. b. Other E way bill being issued on 20.03.2020 and the validity has expired but not reached the destination. What can be done now? (Posted On: 07 May, 2020)

a. In the first case, there is no remedy available except to issue credit note and generate a new E way bill with a new invoice. The relaxation has been provided for E way bills generated between 20.03.2020 to 15.4.2020. Hence it is not applicable in instant case. b. In the second case, we would bring into light the notification No. 40/2020-Central tax dated 05.05.2020 wherein the validity of E way bills generated on or after 20th of March 2020 and its period of validity expires between 20th march 2020 to 15th April 2020 then the validity shall be deemed to be extended till 31st May 2020.
During the month of march 2020, there is no outward liability and no ITC. But there is a liability to be paid under RCM. Am I required to pay interest on the same @9% (My turnover exceeds Rs.5 Crore) (Posted On: 07 May, 2020)

Yes sir if you have exceeded 15 days (nil interest as per notification No. 31/2020-Central tax dated 03.04.2020) then interest shall be applicable at the rate of 9% on the tax amount payable under RCM as it is to be discharged in the form of cash though you are claiming ITC of the same.
Sir we are manufacturing a new product during the COVID -19 lockdown that is Sanitizer’s steel stand. What is the tariff heading and GST applicable on the same? (Posted On: 07 May, 2020)

Sir in my opinion sanitizer stand falls under the HSN 7326 and it is chargeable to 18% duty.
Suppose the value of the product is Rs 100 and Mandi tax on it is Rs. 2. Then on what amount is GST applicable Rs. 100 or Rs. 102. (Posted On: 07 May, 2020)

As per section 15(2) of the CGST Act 2017, the value of supply shall include “(a) any taxes, duties, cesses, fees and charges levied under any law for the time being in force other than this Act, the State Goods and Services Tax Act, the Union Territory Goods and Services Tax Act and the Goods and Services Tax (Compensation to States) Act, if charged separately by the supplier;” So as per the above provisions, GST is applicable on Rs. 102 as stated in your query.
Supplies to Export Oriented Unit whether it is needs to be accounted as Deemed Export or Zero rated supply. (Posted On: 05 May, 2020)

Ans. Only supplies made to SEZ has been notified as Zero rated supply. Supplies to EOU has not been notified under Zero rated supply so it shall be treated as normal taxable supplies. However, deemed exports covers supply to EOU. Hence, it will treated as deemed exports.
Would an ISD require to obtain registration for each state? (Posted On: 05 May, 2020)

Ans. Input Service Distributor is required to obtain compulsory registration under GST in a state or Union territory from where he receives a taxable supply of goods or services or both and intend to distribute the same. But he is not required to obtain registration in the State/Union territory to where he is distributing the credit. It can be clear by an example. M/s X Limited is having head office at Mumbai and factories in Gujarat and Rajasthan. If he received the services only at Mumbai and intends to distribute the same to its factories then he has to register as ISD at Mumbai. But he is distributing the credit at Gujarat and Rajasthan. Now, he need not to register as ISD at Gujarat and Rajasthan.
We are registered with GST department as well as manufacturer of certain product. We also intend to trade in certain goods. Should we get the permission for the same? (Posted On: 04 May, 2020)

There is no restriction of trading and manufacturing in GST law. You can do it trading in all goods.
If we, manufacturer of certain product, have added one new product to existing products manufactured by me. What is to be done? (Posted On: 04 May, 2020)

First of all, try to locate its HSN code and rate of duty applicable. Thereafter please add the same as your outward supply in your registration application. After amending your registration, you should can make outward supply of the same.
Sir the company has registrations in different states but salary is being paid from one state. Then what has to be done. (Posted On: 04 May, 2020)

Sir in this case the state paying the salary has to pay tax under RCM basis and has to charge invoice on other states where the director renders his services and apply GST on forward charge on such services. This has been given in the ruling in case of Columbia Asia where GST is to be charged on forward charge basis in case of Cross Charge.
Can we generate e-invoice through mobile also? (Posted On: 04 May, 2020)

Yes, it has been proposed that e-invoices can be generated through mobile apps also but the functionality will be available in the days to come. It is to be noted that it is not possible to generate e-invoice from every mobile as the user will be require to register IMEI of mobile through which e-invoice is to be generated.
Is one E way bill sufficient if multiple invoices are generated to the same recipient. (Posted On: 04 May, 2020)

If two invoices are issued by a single supplier to the same recipient, separate E-Way Bills should be generated. Since, multiple invoices cannot be clubbed to generate one E-Way Bill.
Taxpayer who have attempted to file return but could not due to technical glitches in the common portal and does not possess digital evidence to corroborate the same. What is the course of action to be taken? (Posted On: 04 May, 2020)

1. Application to be given to respective Nodal officer of the IT redressal committee of respective area. 2.The Nodal offer can get the report from the IT to check if the attempt was made. 3. If the application is rejected or not acted in a reasonable time, file a writ petition before the Jurisdictional HC for necessary directions
What is Multi vehicle E way Bill? (Posted On: 04 May, 2020)

Multi vehicle e way bill is a situation where the consignment of one e-way bill has to be moved in multiple vehicles, after moving to trans-shipment place. For example, an e-way bill is generated and needs to be moved from city A to city C. Here, the consignment moves from city A to city B via Rail or bigger vehicle. Now, it is not possible to move the consignment from city B to city C in the same mode of transportation due to unavailability of that mode or may be due to hilly region where big vehicles cannot be used. In such cases, the consignment needs to be moved in multiple smaller vehicles.
Sir, We have received an insurance claim against the damage done to the Furniture & Fixture due to fire at one of our showrooms. The showroom was built in pre GST period and no input of GST was thus availed. Are we still require to pay GST/ reverse input credit of GST on such insurance claim which is received by us. If yes, how much. Chandresh (Posted On: 03 May, 2020)

Ans. No GST is not payable on the insurance claim received.
XYZ (Goods Transport Agency) is registered with GST and is providing GTA services to PQR (Goods Transport Agency) who is not registered with GST. Is XYZ required to charge GST to PQR or it is exempted since PQR is un-registered? Kaustubh Ram Karandikar (Posted On: 03 May, 2020)

Ans. GTA Services provided by GTA to unregistered person is exempt by way of Notification No. 32/2017 central tax (Rate). The relevant entry 21A is being reproduced for your reference. Sl. No. Chapter, Section, Heading, Group or Service Code (Tariff) Description of Services Rate (per cent.) Condition “21A Heading 9965 or Heading 9967 Services provided by a goods transport agency to an unregistered person, including an unregistered casual taxable person, other than the following recipients, namely: - (a) any factory registered under or governed by the Factories Act, 1948(63 of 1948); or (b) any Society registered under the Societies Registration Act, 1860 (21 of 1860) or under any other law for the time being in force in any part of India; or (c) any Co-operative Society established by or under any law for the time being in force; or (d) any body corporate established, by or under any law for the time being in force; or (e) any partnership firm whether registered or not under any law including association of persons; (f) any casual taxable person registered under the Central Goods and Services Tax Act or the Integrated Goods and Services Tax Act or the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act. Nil Nil
For Import on FOB, Ocean freight paid by importer directly to foreign shipping line. Ocean Freight amount is separately shown in bill of entry. 1) On what value GST is to be paid under reverse charge by importer? 2) what is % of GST 3) Whether to pay IGST or CGST + SGST? If said freight is initially paid by CHA or freight forwarder to the foreign shipping line and then recovered from importer, whether importer liable to pay GST under reverse charge? Kaustubh Ram Karandikar (Posted On: 03 May, 2020)

Ans. A. Yes sir you are required to pay GST under reverse charge mechanism as the importer is making payment to the foreign shipping line. This shall be considered as import of service under Section 2(11) of the IGST Act. i) GST under RCM is to be paid on the amount paid by the importer to the foreign shipping line. The relevant portion of the corrigendum issued to the notification is being produced for your reference. “Where the value of taxable service provided by a person located in non-taxable territory to a person located in non-taxable territory by way of transportation of goods by a vessel from a place outside India up to the customs station of clearance in India is not available with the person liable for paying integrated tax, the same shall be deemed to be 10 % of the CIF value (sum of cost, insurance and freight) of imported goods.” ii) The GST tax rate shall be 5% for transportation services. iii) As this is import of service, tax is to be paid under IGST. B. If freight is initially paid by the foreign shipping line and then recovered from the importer, then the importer is not liable to pay GST under reverse charge mechanism. But foreign shipping line not having office in India cannot register in India and pay the GST. We would also like to add here that Hon’ble Gujarat High Court has decided the matter in favour of assessee saying that reverse charge is applicable on recipient of service but importer is not recipient and hence the GST under reverse charge is not applicable in this case. But this matter will likely to go in Apex Court.
While logging to e-invoice portal, message appears “Your account is frozen” what is the reason for this message? (Posted On: 02 May, 2020)

If your GSTIN is inactive or cancelled, then this message can appear. However, if you are able to login to the GST portal and still this message is appearing then you should lodge your grievance at e-invoice portal.
I am a registered taxpayer in GST. While filing GST Tran 1, my Consultant of VAT forgot to file vat return for the last quarter. I filed GST TRAN 1 before filing of vat return taking into account the estimated credit to be carried forward. Now what should be the probable solution? (Posted On: 02 May, 2020)

The only solution left with you is to knock the doors of High court and file a writ petition. Because it is the committed mistake of taxpayer. High court may grant relaxation as we have not evaded any tax or has not availed any excess or wrong ITC.
First the goods have been sent by road and then will be carries by rail. Can I change the mode of transport in Part-B? (Posted On: 02 May, 2020)

Yes Sir you can easily update Part-B can change the mode of transport.
Sir I have to send my goods to Delhi. But the transporter to whom I have given the goods has delivered the goods in Jaipur and then assigned to another transporter who will deliver the goods in Delhi. How will I update the other transporter’s details? (Posted On: 02 May, 2020)

Sir only the transporter can assign to another transporter.You have nothing to do with this. But care is to be taken that the transporter updates the E way bill and assigns to another transporter otherwise goods might be seized by the department.
I have sent my goods to Jaipur but the receiver sent that the goods are to be sent to their office registered in other state Delhi. What about the E way bill? (Posted On: 02 May, 2020)

In this case if the invoice is made mentioning Jaipur address of client as the Consignee then the invoice is to be revised as CGST & SGST might have been charged. A new invoice is to be generated mentioning Delhi as the consignee and a new E way bill is to be made accordingly. The new bill can be generated from Jaipur to Delhi. But you have to issue credit note for the old invoice.
Is commission paid to directors also liable to RCM? (Posted On: 01 May, 2020)

Yes sir this is a very settled issue that consideration paid to directors would attract tax under RCM basis. This shall fall under Entry No. 6 of the Notification No. 13/2017-Central Tax (Rate) dated 28th June 2017.
Can I file GSTR-3B through EVC as my DSC is not available with me during lockdown. (Posted On: 01 May, 2020)

Sir if you are filing GSTR-3B then the facility of filing through EVC has not been enabled be either company or any other taxpayer. This facility of filing return has been enabled only for companies but only for filing GSTR-1. Please refer to “GST Update on EVC enabled for companies” uploaded on our website www.capradeepjain.com for better understanding.
In order to add additional place of business, Do I have to submit the related documents. (Posted On: 01 May, 2020)

Sir while adding the additional place of business in Non-core fields, the uploading of document is not required but once the application form is amended, the notice is received from department online on the portal then you are required to add the related documents.
Sir does medicines provided to outdoor patients also be treated as composite supply and not taxable. (Posted On: 01 May, 2020)

No medicines provided to outdoor patients is taxable as they are given separate bills and shall not be treated as composite supply.
I am supplier of drinking water in sealed containers. Whether i am eligible for any kind of exemption? (Posted On: 01 May, 2020)

Notification no. 12/2017 central tax rate dated 28.06.2017 entry no 99 clearly states that water other than sealer container is exempt. circular no. 52/2018 also clarifies the same. therefore you are required to pay tax as per rate prescribed under HSN 2201.
Sir during lockdown has the requirement from generation of E way bill also being relaxed. (Posted On: 30 Apr, 2020)

No sir, there is no relaxation in generation of E way Bill during lockdown. Only the validity of the way bills generated between 20th march to 29th April has been extended to 30th April 2020. As lockdown period has been increased to May 5,2020, hence it is represented to CBIC to extend the time period of e-way bills.
As the AAR discusses about the payment of tax on RCM basis on salary, Whether RCM is applicable on the sitting fees paid to directors? (Posted On: 30 Apr, 2020)

Yes sir this is a very settled issue that consideration paid to directors would attract tax under RCM basis. This shall fall under Entry No. 6 of the Notification No. 13/2017-Central Tax (Rate) dated 28th June 2017. Though there is dispute on RCM on salary paid to directors but no dispute on sitting fees.
Sir I have purchased masks and sanitizers for the safety of the employees as our manufacturing unit has been reopened subject to the conditions being given by the government. Is credit being available? (Posted On: 30 Apr, 2020)

In order to answer this, we are producing the relevant portion of Section 17(5) of CGST Act 2017 which deals with the blocked credits as follows. “(i) food and beverages, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery except where an inward supply of goods or services or both of a particular category is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply;” But a proviso has also been inserted stating that the above credit shall be available if it is obligatory under any other law. Government has issued safety guidelines in order to start the re-opening of Industrial units in order to prevent the spread of COovid-19. But this has been merely issued in the form of news. So there shall be litigation about the availability of credit. In our opinion credit shall be available as stated by us in the earlier queries as it is being done by factories and offices as per Government guidelines.
Old Letter of Undertaking valid? (Posted On: 30 Apr, 2020)

Yes, up to 30.06.2020 and assesses can apply new LUT online. Assesses can mention OLD LUT number till the date of issue of New LUT is issued.
Whether relaxation of requirement of bond for the full Financial year? (Posted On: 30 Apr, 2020)

No, Relaxation is not full financial year. Relaxations to accept an undertaking in lieu of bond required during custom clearance up to 30.04.2020 vide 18/2020. After that Government has extended to 15.05.2020 vide circular no. 21/2020-Customs dated. 21.04.2020.
5. How to solve SB005 Error in custom portal. (Posted On: 29 Apr, 2020)

Ans. Exporter can solve through amendment of GSTR 1 Return in one time after that errors has remaining in related to SB005 than exporter can apply manually i.e (letter/ Mail) to ICED Port for clearance of Refund pending due to SB005 Error vide circular no. 22/2020-Customs dated. 21.04.2020.
Can Invoice be made in dollar currency, if sales made in India? (Posted On: 29 Apr, 2020)

Ans. GST invoice is to be made in terms of Indian Currency irrespective of commercial invoice being made in dollar terms.
The notification related to PMT 09 has not yet come into effect? (Posted On: 29 Apr, 2020)

Ans. Notification No. 37/2020 has been issued yesterday i.e on 28th April, 2020 to give effect to changes in Rule 87(13) of CGST Rules, 2017 related to PMT 09 with effect from 21st April, 2020.
If I am a Casual Taxable person and taken registration say on 1st Jan and the registration is effective upto 90 days i.e till 30 March 2020, whether it will also get extended to 30 June.? (Posted On: 29 Apr, 2020)

Ans. No. Notitication 35/2020 issued under power conferred under Section 168A has given exception to Sec 27 (relating to Casual taxable person) of CGST Act 2017. This means that provisions relating to extension of time limit are not applicable to causal taxable person. However, proper officer may extend the said period of registration for another 90 days.
Can credit be claimed if I purchased masks, gloves, sanitizers for employees. (Posted On: 29 Apr, 2020)

Ans. Yes, credit can be claimed for the above mentioned purchases as these are not falling under Section 17(5) of CGST Act, 2017.
Whether condition of payment to be made within 180 days from date of invoice to the supplier is also deferred till 30th June, 2020? (Posted On: 28 Apr, 2020)

Ans: Yes, the extension is also applicable for 180 days condition.
What is the HSN rate for Plastic Shield Masks? (Posted On: 28 Apr, 2020)

Ans. If it is supplied individual then HSN for plastic face shield is 3926.
Sir I am supplying Plastic Shield Mask along with PPE Kit. Is this to be taxed separately or to be treated as composite Supply? (Posted On: 28 Apr, 2020)

Ans. Sir if you are supplying along with the PPE Kit then it has to be treated as composite supply and has to be taxed as per the rate on the principle supply.
My GST registration has been cancelled. What is the time limit for revocation? (Posted On: 28 Apr, 2020)

Ans. As per Section 30 of the CGST Act 2017, a person can apply for revocation of cancellation of registration within 30 days from the date of service of cancellation Order. But if the date of revocation falls within March 20 to June 29 then it will be extended to June 30, 2020 as per notification number 35/2020 issued under power conferred under Section 168A of CGST Act.
Hello sir, I have applied for refund in the month of April 2020 for the month of January 2020. When shall I pass entries in the books of accounts of debiting the credit ledger in the month of April or January. Please Guide. (Posted On: 28 Apr, 2020)

Ans. Sir we would suggest you to pass the entries in the month of April 2020. This is so as it would not have a major impact on your Balance sheet. Even in GSTR-3B return also, it will be reflected in the month of April 20 only.
During Lockdown I wanted to file my GST returns but due to unavailability of DSC, I am unable to file the return. What shall I do? (Posted On: 27 Apr, 2020)

Government has enabled GST Portal to provide the option to file GSTR-3B by Electronic Verification Code (EVC) instead of the Digital Signature Certificate in case of companies. Therefore, the taxpayers can submit GSTR-3B without DSC and by generating OTP. However, if the lockdown is extended, it appears that such relaxation would be provided for other returns and system related compliances in near future. This permission is not applicable for filing GSTR-1 or other compliances to be made. Please refer to “GST Update on Filing of GSTR-3B through EVC by companies” published on our website www.capradeepjain.com.
Sir, if I file GSTR-1 of March, 2020 on 5th July, 2020, whether late fees will be applicable for 5 days or from 11th April, 2020? (Posted On: 27 Apr, 2020)

If GSTR-1 is filed after 30th June, 2020, late fees be applicable from the due date of filing return being 11th April, 2020
Hello sir, I have gained profit resulting from Foreign exchange Fluctuation. What is the impact of GST on this. (Posted On: 27 Apr, 2020)

Sir, You need to reflect this in Profit and loss account as “Gain/loss from Foreign Exchange”. There would be no impact of GST on this.
Is the limit for registration applicable if I am an Inter-state Provider of service. (Posted On: 27 Apr, 2020)

Yes, the limit for registration of 20 lakhs is applicable even where there is interstate supply of Services. Unlike in the case of interstate supply of Goods.
Whether proviso to rule 36(4) will be applicable for the month of Sep 20? (Posted On: 27 Apr, 2020)

No. because clearly it is mentioned in the notification that the relaxation is given for the months of February, March, April, May, June, July and August, 2020. So in Sep 2020 credit will be taken in accordance with rule 36(4).
Describe about the re-validation /Export Obligation period extension in advance authorisation? (Posted On: 25 Apr, 2020)

All Re-Validation/ Export Obligation period extend automatically in ICEGATE/Customs system Except in:- Those authorisation 1st or 2nd revalidation or EO extension has been granted, automatic transmission of extended dates is not possible due to system architecture issue. The exporters shall make an amendment request through email/letter to the concerned RA. Where Authorisation are physical (non-EDI) nature :- the exporters shall make an amendment request through mail/letter to the concerned RA.
Whether interest is payable on credit reversal on account of cumulative adjustment of Rule 36(4) in the month of September, 2020? (Posted On: 25 Apr, 2020)

No, as the relaxation is provided by government, no interest would be required on credit reversal.
can a taxpayer dealing both in goods and services opt for composition scheme, if yes then what is the limit? (Posted On: 25 Apr, 2020)

The answer is yes. provision in section 10(1) states that "Provided further that a person who opts to pay tax under clause [a] or clause [b] or clause [c] may supply services [other than those referred to in clause [b] of paragraph 6 of Schedule II], of value not exceeding ten per cent. of turnover in a State or Union territory in the preceding financial year or five lakh rupees, whichever is higher."
If I have filed GSTR 3B return for the month of February 2020 and has taken credit as per GSTR 2A. After filing of GSTR 3B return of Feb 2020, proviso to rule 36(4) has been introduced. whether I can avail the remaining credit that is difference between credit availed in 3b return and books of accounts in March return? (Posted On: 25 Apr, 2020)

Yes you can do so. Because the GSTR 2A has to be reconciled with books of accounts for the month February to August 2020 as on 11th of October 2020.
Hello Sir, Can I claim refund of inverted Duty structure where I am a Job worker. And Can I avail credit if I get the goods Job worked from others. (Posted On: 25 Apr, 2020)

Yes, you can claim refund of inverted duty structure in the case where your output tax rate is lower when compared to the input tax rate. You can also claim credit of the input service where the goods are being sent for Job work but subject to the fullfilment of the condition that the output tax rate shall be lower when compared to the input tax rate.
While logging into e-invoice portal, message appears “Your account is frozen” what is the reason for this message? (Posted On: 24 Apr, 2020)

If your GSTIN is inactive or cancelled, then this message can appear. However, if you are able to login to the GST portal and still this message is appearing then you should lodge your grievance at e-invoice portal. Sir it is pertinent to mention that the implementation of E invoicing has been postponed and shall be effective from 1st October 2020. Only trial version portal is being operational. This reply is prepared on the situation when this system of e- invoice is made operational and this message reflects on your portal.
I tried to register on the e-invoice portal but the system is saying that you have already registered how to proceed further? (Posted On: 24 Apr, 2020)

We would like to mention first that the implementation of E invoicing has been postponed and shall be effective from 1st October 2020. It appears that you are already registered on e-way bill portal and the same login credentials should be used for login into the trial version of e-invoice trial portal. We would like to mention here that only trial version is operational on portal.
Greetings Sir, I am an exporter and the refund of IGST is being delayed. The reason being reflected is SB005 error. Can you please elaborate and guide me on this issue? (Posted On: 24 Apr, 2020)

SB005 is an error where the details in Shipping Bill do not match with that mentioned by us in GSTR-1 while filing return. For Example, If the Invoice No. in shipping Bill is 002/2020-21 but while filing GSTR-1 it was mentioned as 002-2020-21, then this error comes into scene and the IGST refund gets delayed until this is rectified in the next returns. Further, the department officers also do have the power to amend the same and sanction the refund. So we suggest either to amend your return or to request the department officers to do the same. Government has issuing clarifications with this respect time to time. Further Circular No. 22/2020 dated 21.04.2020 has been issued. For detailed understanding please refer “GST Hindi Update on IGST Refund SB005 error” published on our website www.capradeepjain.com.
Hello Sir, I am categorised as risky exporter. Though the red flag has been removed by the port but the tag of Risky exporter is still continued yet. What shall I do? (Posted On: 24 Apr, 2020)

In this case we would request you to approach authorities of other ports as well. The red flag can be removed by a port only after physical verification, audit by CGST department. Even the report must have been sent by CGST department to Customs. This might continue due to the reason that report was not seen by other authority of that port.
Sir I had paid tax under the wrong head. Previously government has said about the functionality for transfer from one head to another. Has this been enabled? (Posted On: 24 Apr, 2020)

Yes sir, this has been enabled on 21.04.2020. If you want to transfer the funds, then following is the procedure. 1)Log in to GST Portal 2)Click on Services →Ledgers → Electronic Cash Ledger. For detailed understanding, please refer to “GST Update on PMT-09 facility” published on our website www.capradeepjain.com
Can material be despatched without preparing e-way bill? The Government has relaxed various provisions in this critical position? (Posted On: 23 Apr, 2020)

Government has extended the validity of the E way bill for those generated and expires during the period 20.03.2020 - 15.04.2020 to 30.04.2020. This is being done by way of Notification No. 35/2020-Central Tax dated 03.04.2020. The Government has inserted a new section 168A through an ordinance and issued notification 35/2020 to extend the dates in bulk. But provisions relating to issue of tax invoice and e-way bill is not relaxed. Even the power to seize the goods and conveyance under section 68 due to non-issuance of e-way bill is also not relaxed.
As most of taxpayers have not filed GST returns. As such, the amount is not reflected in our GSTR-2A. Hence, we will not be able to take credit. Hence, we will be compelled to file the returns at a later date? (Posted On: 23 Apr, 2020)

As per Notification No. 30/2020 – central Tax dated 03.04.2020, a proviso has been inserted to Rule 36(4) of CGST Act 2017 wherein cumulative adjustment of Input tax credit in GSTR-3B can be done in the month of September 2020 for the periods from February to August 2020.This indicates that for the tax periods from February to August 2020 the credit reflecting in the books of accounts can be claimed in GSTR-3B. So there is no such requirement to delay the filing of returns due to the reason that the amount is not getting reflected in GSTR-2A.
What is the HSN code and GST rate for Sanitizer? (Posted On: 23 Apr, 2020)

HSN for Hand Sanitizer is 4818 and GST rate applicable is 18%.
Will the refund of exporters who are marked as “Risky exporter” will be released as CBIC has issued instructions for early disbursement of refund claim? (Posted On: 23 Apr, 2020)

Yes sir, this is a topic of concern as the refund of Risky exporters is being stopped due to the reason that physical verification of unit as well as audit of exporter is to be undertaken by CGST department. Only after this is done, the custom will remove the flag of risky exporter and refund will be granted to the exporter. There is no clarification by Government that refund should be granted without removing flag of risk exporter. “GST & Johnny – Update No. 30” and “GST & Johnny - Update No. 32” on this topic is published on our website www.capradeepjain.com as well as on our website page. A representation is also sent to Government to release the refund to risky exporter without examination in this crucial position of lockdown without insisting on audit and physical verification. These are not possible in this situation. Moreover, the Government is also keen to release the refund claims to exporters at the earliest.
We have prepared a bill with higher duty @ 18%. E-way bill was also prepared. Now we came to know that GST payable on the same is 12% only. How to rectify the same? (Posted On: 23 Apr, 2020)

In this case we suggest you to issue a credit note for the difference tax rate of 6%. Further this is to be reflected in GSTR-1 in credit/Debit notes section. In this the taxable value can be mentioned as a nominal Value say Re 1.
Sir, As per notification 20/2019 under GST, ODC now taxable @ 5% without ITC. Can we claim ITC on capital goods purchased for payment of such tax. Gouresh Agrawal (Posted On: 23 Apr, 2020)

No sir ITC on capital goods cannot be taken as the condition in the notification uses the term “Provided that credit of input tax charged on goods and services used in supplying the service has not been taken”. The goods includes capital goods also.
Hello sir, I am an exporter and wanted to know if there is any extension in MEIS license. (Posted On: 20 Apr, 2020)

MEIS License has been extended to 31.12.2020. For clear understanding you can refer hindi update on our website on “GST update on MEIS” published on our website www.capradeepjain.com as well as our facebook page of GST update.
Sir, needed assistance as I have been sanctioned Refund but it is not received in my bank account. Please guide. (Posted On: 20 Apr, 2020)

If the refund is being sanctioned and not received in bank account there might be an error in bank account details being mentioned. The status of the same can be checked on the PFMS website and this can be rectified by updating the bank account details on the website. But it takes 10 to 15 days time to get the refund claim in your bank account in normal parlance. Hence, wait and watch. In case of viewing the status, the recently introduced procedure of viewing on PFMS website can be followed.
I have obtained registration by way of migration. Due to the spread of COVID – 19 pandemic disease, I wanted to manufacture medical equipment in my factory premises. In order to do so I have to add the product to my GST portal. Please brief me out on the procedure. (Posted On: 20 Apr, 2020)

Adding new Goods & services in GST registration is a non-core field. Below is the procedure explained step by step i) Log in to your account on GST Portal ii) Go to Services →Registration → Amendment of Registration non-core field iii) An application form will be displayed with both core and non-core fields. The non-core fields will be shown in an editable format. iv) Select “Goods & Services” and make the required changes. v) In order to complete the process of making amendment, it has been seen by us that in number of cases which are migrated on 1.7.2017 and has not done any amendment thereafter then portal is asking for Upload Authorisation Letter (by way of board resolution). Then this process has to be completed.
Hello sir, I wanted to take curfew pass, but as the E mail ID registered on the portal of my Firm is wrong. So I am unable to obtain the pass. Can you please guide me on the procedure to change the Email ID. (Posted On: 20 Apr, 2020)

Amendment in the E mail ID can be done in two days. a. Submit a request letter to the department for the change in Email ID as the officers have the authority to amend the Email Address. b. Another way out is to make the amendment by ourselves on portal. The amendment to Email ID can be done by following the below mentioned steps. i) Log in to your account on GST Portal ii) Go to Services →Registration → Amendment of Registration non-core field iii) An application form will be displayed with both core and non-core fields. The non-core fields will be shown in an editable format. iv) Select Promoter / Partner / Authorized Signatory and make the required changes. In your case, it would the email ID v) A success message is displayed and an acknowledgement number copy will be sent to your email
Sir Can you explain the amendment made to Rule 36(4)? (Posted On: 20 Apr, 2020)

Notification no. 30/2020-Central Tax dated 3rd April 2020 has been issued in order to provide relaxation to the taxpayers from complying with the restriction put on availing credit in GSTR-3B which is maximum upto 10% of the eligible credit being reflected in GSTR-2A for the periods February to August 2020. This can be understood that the books being reflected in books can be taken for the periods being specified above. Further while filing GSTR-3B for the month of September Rule 36(4) is to be looked into and that too on cumulative basis for the period during which relaxation was given. For detailed understanding you can please refer to our updates “GST UPDATE ON RELAXATION WITH RESPECT TO RULE 36(4) OF CGST RULES, 2017” and “GST Update in Hindi on Rule 36(4)” published on our website.
Am I required to furnish LUT for the new FY 2020-21 as my DSC is in office and due to lockdown no one is unable to attend the office. What shall I do? Richa (Posted On: 18 Apr, 2020)

Government has issued inserted Section 168A by Ordinance and issued notification number 35/2020 to extend the date of any Act is to be done by a date falling between 22/3/2020 to June 29, 2020 then this date will be extended to 30/06/2020. Hence, we have prepared a Hindi update and told that the date of filing of LUT will be extended to 30/06/2020.Later on Government has ratified our understanding by issuing circular number 137/07/2020 dated 13/04/2020 that LUT can be filed by 30/06/2020 (Ref- point number 4). It has also be clarified that meanwhile old LUT number can be mentioned to export the goods.
I am importing Face mask. What is the rate that is applicable? Please reply. preeti (Posted On: 18 Apr, 2020)

As per the customs tariff notification no. 20/2020 dated 09.04.2020, Basic Customs duty and health cess is exempted on this product. But IGST will be applicable.
I have a turnover above Rs. 5 crore. Can you please tell what is the last date to file GSTR-3B for the month of March if I am registered in the state of Gujarat. Jitendra (Posted On: 18 Apr, 2020)

The due date to file GSTR-3B for the month of March 2020 is 22nd April 2020 vide Notification No. 07/2020-Central Tax dated 3rd Feb 2020 in the state of Gujarat. Amid the lockdown Government has not extended the due date but it has waived late fees and reduced the rate of interest subject to the condition that the return is furnished on or before 24th June 2020 as per the facts stated in the query. Further the benefit Nil interest for the first 15 days i.e. upto 7th May 2020 is available. And thereafter a reduced rate of 9% is applicable for the remaining days if the return is filed on or before 24th june 2020. But if you file after that date then full interest and late fee will be applicable.You can also refer to our “GST Update on Notification 31/2020 & 32/2020 dt.03.04.2020” published on our website.
Sir I had prepared E way bill on 21st march for invoice and selected the mode of transport by rail. The E way bill expired on 30th March. But due to lockdown the goods were not sent. What can be the remedy now? Please reply Kartik (Posted On: 18 Apr, 2020)

There is no remedy in this situation. The e-way bill should have been extended. But we are of opinion that officer will understand that current situation has not allowed the dispatch of material as well as applying for extension of e-way bill. In this case we would suggest to cancel the previous invoice and prepare a new Invoice on which E way bill can be prepared. The E way bill portal does not accept the same invoice number again as the policy of “one Invoice, One E way Bill” is followed. We would further like to say that a letter be submitted to the department regarding the cancellation of Invoice and generation of new E way bill on the basis of another invoice.
Hello sir My question is Pesticides rate is changed from5 (vat)to 18 (Gst) so how to claim transition credit of excise duty paid on stock held on 30 June ,in which column I have to mention in Trans 1 I have excise invoices of stock held A.Venkatesh (Posted On: 16 Nov, 2017)

In GST TRAN-1, you can show under head 7(a)-Duties and taxes on inputs in respect of excise duty paid on stock held on 30th June'2017.Since you have invoices of stock held, you can simply chose "Yes" while entering details of the same.
SIR, PLEASE ADVICE THE FILL-UP FOR GST ITC-04 WE ARE MANUFACTURING OF MOTOR VEHICLE PARTS, JUST LIKE MATERIAL OF S.S. COILS, PIPE/TUBE AND OTHER M.V. PARTS SEND TO JOB-WORK FOR CUTTING & SLITING AND BACK RETURN VEERSINGH TANWAR (Posted On: 11 Nov, 2017)

THE KEY FEATURES OF FORM GST ITC 04 OFFLINE UTILITY ARE: - THE ITC-04 DETAILS CAN BE PREPARED OFFLINE WITH NO CONNECTION TO INTERNET. - MOST OF THE DATA ENTRY AND BUSINESS VALIDATIONS ARE IN BUILT IN THE OFFLINE TOOL REDUCING ERRORS UPON UPLOAD TO GST PORTAL. HOW TO DOWNLOAD AND OPEN IT - LOGIN TO THE GST PORTAL WWW.GST.GOV.IN. - GO TO DOWNLOADS > OFFLINE TOOLS > FORM GST ITC 04 OFFLINE TOOL BUTTON AND CLICK ON IT. - UNZIP THE DOWNLOADED ZIP FILE WHICH CONTAIN ITC_04_OFFLINE.XLS EXCEL SHEET - OPEN THE ITC_04_OFFLINE.XLS EXCEL SHEET BY DOUBLE CLICKING ON IT. WHO NEEDS TO FILE FORM GST ITC-04? A REGISTERED PERSON (PRINCIPAL) IS REQUIRED TO FILE A DECLARATION IN ‘FORM GST ITC-04’ EVERY QUARTER, WITHIN THE PRESCRIBED TIME, IF THE PRINCIPAL IS SENDING ANY INPUTS OR CAPITAL GOODS TO A JOB WORKER AND RECEIVES IT BACK OR SENDS IT OUT TO ANOTHER JOB WORKER OR SUPPLIES FROM PREMISES OF JOB WORKER TO CUSTOMER DIRECTLY.
In excise we are register mfg. company after GST we migrate we c/f our cenvat credit balance in show ER 1 which tranfer in for TRANS 1 and credit account in GST. my query in GST law we have not c/f Amount IN PLA Cloaisng Balance in ER 1 to GST Cash account our person said y hv claim Refund under Excise Rule. not C\f. as a small trader small amount c/f how to claim with department officer may query arise at claim time. can i claim in TRNS 1 ? devang shah (Posted On: 11 Nov, 2017)

Sir, you can only carry forward the credit of service tax, excise, VAT in GST. You need to file Tran 1 to carry forward the credit. If there is any PLA balance in Excise or service tax return, then you have file refund to department in this respect. No, you cannot claim PLA balance in GST Tran-1.
My landlord migrated to GST in August 2017. He raised an invoice for rent for July 2017 in advance after receiving GSTIN in August. Am I liable to pay GST? K Sanjeev (Posted On: 09 Nov, 2017)

If the landlord has migrated himself under GST, then he will deemed to be registered from 1st July'2017. Therefore, the landlord has right to raise invoice for July month and you are liable to pay GST.
sir we are excise regi. mfg. company we migrate to GST as per GST Rule. in excise our cenvat credit transfer to GST and we fill form Tras 1 and cenvat creit can claim as c/f but our PLA account in credit show balance our consultant said y have not c/f PLA account which is show in ER1 only for Refund claim with GST rule. my query it is any rule/act in GST y not c/f PLA account for excise pla account balance. in PLA small amount how to claim with department and what is process for any if refund and how to handle with department officer below 10000/- amount refund. pl. reply Devang Shah (Posted On: 08 Nov, 2017)

Sir, you can only carry forward the credit of service tax, excise, VAT in GST. You need to file Tran 1 to carry forward the credit. If there is any PLA balance in Excise or service tax return, then you have file refund to department in this respect.
Jain sir I do small contract of interior wood work. It's less than 20lakh turnover. So is it mandatory for me to take gst no. Even I want to open current account. Pl reply Prabhakar Singh (Posted On: 03 Nov, 2017)

Sir if your total turnover is not exceeding twenty lacs, then you are not liable to take registration under GST regime as per section 22(1) of CGST Act,2017.But the bank officials will ask for proof of existence of your firm to open a current account. As a proof, you can submit service tax registration or VAT registration related documents etc.
Jain sir I do small contract of interior wood work. It's less than 20lakh turnover. So is it mandatory for me to take gst no. Even I want to open current account. Pl reply Prabhakar Singh (Posted On: 03 Nov, 2017)

Sir if your total turnover is not exceeding twenty lacs, then you are not liable to take registration under GST regime as per section 22(1) of CGST Act,2017.But the bank officials will ask for proof of existence of your firm to open a current account. As a proof, you can submit service tax registration or VAT registration related documents etc.
Sir, am doing a business of installing the cctv cameas.cc cameras are supplied by us and installation is done.whether we have to raise one invoice for supply of goods and another invoice for supply of service or both can be made in a single invoice.whether the gst rate of this service and goods is 18% jithesh (Posted On: 31 Oct, 2017)

Sir you can prepare one single invoice for both goods and service. You are required to mention HSN and SAC separately in the invoice. CCTV and installation services both are charged at 18% rate.
Providing service to sez...What is HSN code for above... I mean i am working in a engineering company located in sez and working on hourly basis..and at the end of the month i raise invoice for my working hours.. RUPESH CHOPADE (Posted On: 26 Sep, 2017)

HSN/SAC code will depend on which type of services is been provided by you to SEZ.
Dear Pradeep Sir, My company is asking to submit LUT bond with Bank Gaurantee as I am working in SEZ unit on hourly basis.... On the end of the month I raise invoice for my working hours... Is there any other option to avoid LUT Bond and Bank gaurantee.... Can I charge IGST on my invoice and then collected IGST , I will submit to government through my GSTN no.... Is this option will work... The next query is "whether i should charge igst on my invoice and collect igst value from company or I should pay igst on my invoice and then claim refund." If yes, then which gstr should I file gstr 1, 2, 3A or 3B Regards, Rupesh RUPESH CHOPADE (Posted On: 26 Sep, 2017)

Any supply made to SEZ is a interstate supply under section 16(1)(b) of IGST Act and the person will be required to get compulsorily registered. Any supply made to SEZ shall be considered to be export of services which can be made with the following options: 1. On payment of IGST and then claim refund; OR 2. Under bond or LUT without payment of duty In rule 96A of CGST rules, export can be made under LUT or bond along with bank guarantee of 15% in form GST RFD-11. However, exporters can avail option of export with payment of IGST by filing regular returns like GSTR-1 and GSTR-3B or GSTR-3. IGST cannot be charged and collected from SEZ; the exporter shall pay it and then can claim refund. You will be required to get registered under GST and will have to file regular returns.
Dear Sir,we have a Land in partnership with other 2 person and made partnership deed, now we made a scheme of 600sqft plots for sale in that land and make a boundry wall around that land and leveling the ground of land. and Money will collected in installment with in three year and Dastavej should also be done after 3 year. now my query is whether we would have to take registration under GST? and Advance received from customer whether sale can be book on that advance? If GST levied then how much Gst on advance should be paid on that? Atiya (Posted On: 25 Sep, 2017)

Under section 22(1) of CGST Act, 2017, any person whose aggregate turnover in a financial year exceeds Rs. 20 lakhs (and Rs. 10 lakhs in case of North Eastern states) shall be liable to get registered under GST regime. Further, any advance received cannot be booked as sale; it will be shown as “Advances received”. We will have to pay GST on advance received and the GST will be adjusted when the invoice is issued finally. Sale of 600sqft plot after making boundary walls and leveling of ground, will be covered under works contract services and shall be taxable at 18%.
Dear Jain sir, Hats off to your invaluable support to people who are being mislead by many so called consultants. Sir, I have recently started a small car garage in Allahabad, U.P., providing repair service, body and paint job repairs, washing and many other jobs related to a small car workshop. I had voluntarily migrated from TIN to GSTN. 1--Am I eligible to apply for Composition scheme? As I provide repair service apart from providing spare parts & lubricants. 2--Should I go for Composition scheme? Will it be beneficial for me? 3--If yes. How to invoice a customer to whom I am selling parts, lubricants as well as providing repair service also? 4--Should I opt for cancelling my GST registration? I hope you will take some of your precious time to answer my queries. ALOK @ AVR MOTORS (Posted On: 24 Sep, 2017)

A taxpayer whose turnover is below Rs 75 lakhs can opt in for Composition Scheme. In case of North-Eastern states and Himachal Pradesh, the limit is Rs 50 lakhs. However, businesses dealing only in goods can only opt for composition scheme. Services providers except those supplying food and beverages have been kept outside the scope of this scheme. Hence, you cannot opt for composition scheme. Tax invoice will be issued as per GST regime. The person who has migrated from VAT or Central excise or service tax can cancel his registration if he is not liable to pay tax under GST regime. However, no online utility for cancelling the registration is available on GSTN as of now.
Sir,we are register service tax in Delhi and we raised a brokerage bill to our client for lease out a property in jammu state and we not charged service tax in the bill due to jammu is exempt state . service provided in jammu and our client and property owner to pertain in jammu state. our query is , are we liable to pay service tax on brokerage recd. from my client as interrogatory services under place of provision of services rule 2012 noti. no. 28/2012ST and noti. no. 14/2014ST. or we exempt from service tax due to service provide in the exempt state. Sir, I shell be very great full to you if you reply positively. Thanks & regards Satish Kumar satish kumar (Posted On: 24 Sep, 2017)

As per rule 5 Place of Provision Service Rules, 2012, the place of provision of services provided directly in relation to an immovable property shall be location of that immovable property. However, the drafting of this rule indicates that the broker's services in relation to leasing of property will not be covered in this rule. Accordingly, rule 9 of these rules will apply which states that the place of provision of services in case of intermediary services shall be the location of service provider, i.e. the location shall be of intermediary, which is in Delhi in the instant case. Therefore, this transaction shall be taxable.
A Trust has Hospital, college and pharmacy shop. Because of pharmacy activity it has taken GST registration. Fees collected by college from Students are exempt. But what is the taxabililty of honorarium / amount paid to the visiting faculty, under RCM (Reverse Charge Mechanism). Naeemuddin Ansari (Posted On: 24 Sep, 2017)

Honorarium is a payment given for professional services that are rendered by visiting faculty which is not on payroll of the college. If the visiting faculty is employee of the college, then no GST is payable but normally, visiting faculty is not on payroll of the college. Hence, any amount paid to visiting faculty shall be leviable to GST. It is also worth mentioning that if such services are received from unregistered person, then GST shall be payable by college under reverse charge mechanism.
Dear sir, I have started my chemical manufacturing company from July 2016. My capital goods purchased from August 2016. I have not taken modvat of excise duty as I was not charging excise duty on my sale due to my turnover less than 1.5 crore. Now from 1st July 2017, I have registered under GST and taking ITC on stock. Can I avail ITC on capital goods excise duty as my purchase of capital goods are with in one year. Regards Ramesh Goyal (Posted On: 31 Aug, 2017)

Credit on Capital goods can be claimed under GST in Tran -1 only if it the credit to be carried forward has been reflected in the Excise Return. Since you were not availing it the previous regime, you are not allowed to avail in GST regime.
whether GST applicable on advance paid to urd delar? If yes, when GST shoulf paid? at the time of Advance given or at the time of Purchase? Divyang (Posted On: 31 Aug, 2017)

Yes, GST is applicable on advance paid to Unregistered dealers. It shall be paid under Reverse Charge Mechanism at the time of payment of Advance.
sir, we are marketd firm,we marketed by some prpoduct which we purchased in june.the party is manufcyere without exice.we have paid vat and also proof of invoice can we claim deemd exice ?we have also credit in VAT where in trans 1 we have to detail out for the same thakns n BR robusca pharma (Posted On: 30 Aug, 2017)

Sir, we are not able to understand your query fully. You are requested to clarify it. As per Our understanding, you have taken VAT credit and lying in balance. It can be carried forward in TRAN-1. But since no excise duty is paid on your final product, then you will not be able to claim the credit of excise duty.
sir, i have stock,which exice invoice in not awailable,purchase from dealer.so can i claimed deemd exice as CGST ?yes then wher is can to displey in TRANS 1 chetan lakhani (Posted On: 30 Aug, 2017)

As per proviso under Sec 140(3) of the CGST Act, any person other than manufacturers or supplier of service who is not in possession of duty paid document is eligible to take deemed credit. If you are a dealer and not having invoices then you can avail 40% percent deemed credit if your goods are taxable at the rate of 5 or 12% otherwise you are eligible for 60% credit. This can be shown in table 7 of Trans-1
Whether Material purchased by traders from units claiming area based exemption would be eligible for Deemed GST credit under proviso to Sec 140(3) SHIV RAJPUT (Posted On: 29 Aug, 2017)

As per proviso under Sec 140(3) of the CGST Act, any person other than manufacturers or supplier of service who is not in possession of duty paid document is eligible to take deemed credit. There is no restriction from whom the trader has purchased the goods. He is eligible for deemed credit as per proviso to Sec 140(3).
I has filled a service tax return st - 3. it was filled sucessfully but one query arise :- the opening balance (Rs. 0/-) of cenvat credit of KK cess entered in the current return at I3.4.1 is not equal to the closing balnce (Rs. 2339) of the immediately period return at I 3.4.4. defferential amount is (Rs. 2339/-) dev sharma (Posted On: 29 Aug, 2017)

Sir, we would request you to re-check the ST-3 return. If still it shows opening balance as Nil, then this is due to technical error.
I has filled a service tax return st - 3. it was filled sucessfully but one query arise :- the opening balance (Rs. 0/-) of cenvat credit of KK cess entered in the current return at I3.4.1 is not equal to the closing balnce (Rs. 2339) of the immediately period return at I 3.4.4. defferential amount is (Rs. 2339/-) dev sharma (Posted On: 29 Aug, 2017)

Sir, we would request you to re-check the ST-3 return. If still it shows opening balance as Nil, then this is due to technical error.
sir, (1)i am doing construction work of individual residential unit on works contract. residencial individual labour work is exempted. now if i gives contract to sub contractor, can subcontractor get exemption because he is doing residential work or he has to charge gst. (2) if i am providing service with both including labour and material , what is the status of gst in that case regards, mayank dave mayank dave (Posted On: 26 Aug, 2017)

As per Notification No. 12/2017 Central tax (rate) “Services by way of pure labour contracts of construction, erection, commissioning, or installation of original works pertaining to a single residential unit otherwise than as a part of a residential complex.” are exempt. So the services provided by a sub contractor to a contractor are also exempt as he is providing labor for the construction of residential house. If in case you are providing service with both labor and material i.e. termed as works contract under GST. They will be charged 12% GST if falling under specified categories given in the notification 20/2017 and 24/2017 of central tax rate. Otherwise, it will be charged at 18% rate.
What will be SAC for supply of crusher grit by installing code RAj (Posted On: 26 Aug, 2017)

995468 other installation Services.
Sir, Can I Revised GST 3b Return ....??? Priyanka Gawade (Posted On: 26 Aug, 2017)

GSTR 3B cannot be revised once submitted. In case any wrong information filled in GSTR 3B, the same can be corrected while filing monthly return of same month i.e. GSTR 1, GSTR2 AND GSTR 3.
Sir what is the amount on which housing society has to pay gst and what credit they can take arun gupta (Posted On: 25 Aug, 2017)

As per Notification No. 12/2017, Heading 9995 “Service by an unincorporated body or a non-profit entity registered under any law for the time being in force, to its own members by way of reimbursement of charges or share of contribution – (a) as a trade union; (b) for the provision of carrying out any activity which is exempt from the levy of Goods and service Tax; or (c) up to an amount of five thousand rupees per month per member for sourcing of goods or services from a third person for the common use of its members in a housing society or a residential complex.” are exempt. Further, if the aggregate turnover is up to Rs 20 lakh in a financial year, then such supplies would be exempted from GST even if charges per member are more than Rs 5,000. If the aggregate Turnover is more than Rs. 20 lakhs in a financial year and the charges per member is more than Rs. 5,000/- then GST shall be applicable. Similarly Housing Societies are entitled to Input tax credit with respect to capital goods, goods and input services.
sir,My question is if mall is generate electric bill for tenant of shop , so please advice me we take GST on electric bill ? virendra shukla (Posted On: 23 Aug, 2017)

Electrical Energy is exempt from GST as per notification No. 02/2017 – central tax (rate) dt 28-06-2017. So GST would not be levied on the electric bill given by mall to tenant. Although there is dispute because service tax was payable on the same. On the same analogy, some scholars are saying that GST is payable on the same. Other school of thought say that If it is included in the rent then the GST is payable as mixed supply.
Dear Sir, Some of our company (registered Office: Delhi) employees went for business promotion in Kerela and incurred soem food expenses, the bill for food expenses is raised by the Hotel in name of our company but has charged CGST and SGST on it. However i am of the view that IGST should be charged kindly clarify the same. Prateek (Posted On: 23 Aug, 2017)

As per sec 12(3)(c )of Igst Act, “The place of supply of services by way of accommodation in any immovable property for organising any marriage or reception or matters related thereto, official, social, cultural, religious or business function including services provided in relation to such function at such property; shall be the location at which the immovable property or boat or vessel, as the case may be ,is located or intended to be located.” So the hotel has correctly charged CGST and SGST of Kerala. You are not eligible to take the credit of CGST and SGST of Kerala in Delhi registered office.
Hi, i have one query that if i paid under expense of publicty to registered dealer, is this treat under RCM method or any other method applicable. is we eligible for credit of ITC against this GST saurabh mishra (Posted On: 22 Aug, 2017)

Since you are paying advertisement expenses to registered dealer, then no liability under RCM arises. RCM arises in case of unregistered dealer as per Sec 9(4) of CGST Act. Yes, you are eligible to take the credit of such tax paid.
if we already take gst number but our turnover is below 2000000 in such case we have to surrender the gst number or not? sajal jain (Posted On: 23 Jul, 2017)

If you have got yourself migrated into GST and consequently obtained the registration number, in that case you can surrender the same before 30 September 2017. If you had voluntarily registered yourself under GST, then section 29(3) restricts cancelling of such registration. However, we suggest that in case you had taken registration mistakenly you may apply for cancellation as we hope that the same can be considered.
Sir, how should jib worker in textile would raise invoice.. if he only purchase the cloth from market and does job work.. Should he raise two invoices?? As the gst rate is different in case of jobwork and cloth Or single invoice with two rates?? Sakshi Agarwal (Posted On: 23 Jul, 2017)

First of all any activity is called job work only when any treatment or process is undertaken by a person on goods belonging to another registered person. If you are enagegd in the activity of buying goods and performing some activity on them and thereafter selling such goods then it cannot be called job work as goods processed are owned by you. If you are engaged in two separate activities that is one of textile trading and other of job work relating to textile both of which are subject to different rate of GST, even then a single invoice can be generated, which bears description, HSN/SAC code, value, tax separately for both goods and services. {Query replied by: Ranu Dhoot, CA}
Dear sir We are into readymade garment business.We are paying 18% to jobworker where else we are charging 5% output . My query is how and when will we get the excess get paid refund. Naveen baldota (Posted On: 22 Jul, 2017)

Although refund of overflow of credit is allowed under Section 54(3) of CGST Act but as per Notification No.5/2017-Central Tax (Rate) dated 28th June, 2017, it has been clearly stated that refund of overflow of credit shall not be allowed in case of textile. {Query replied by: Ranu Dhoot, CA}
I am manufacturer of ready mix concrete, I have concrete mixer loories, can I avail ITC on repairs/spare parts of concrete mixer loories under GST. Yuvraj (Posted On: 21 Jul, 2017)

No ITC is available in respect of motor vehicles due to Section 17(5) of the CGST Act, 2017 except when they are used for further supply or transportation of passengers or imparting training on driving etc. There are two views on repairs of motor vehicle. One school of though says that there is not restriction on availing ITC on repair/spare parts of motor vehicles. Thus one can avail ITC on repair/spare parts of concrete mixer lorries. But other experts say that since section 17(5) says that credit “in respect of “ motor vehicle is not allowed and this expression will have wider effect and credit on repairs of vehicle will not be allowed. {Query replied by: Ranu Dhoot, CA}
Sir, Mining Royalty (collect by the contractor/department) are including in GST or Not, if included under gst, what is the rate of tax Ramesh (Posted On: 21 Jul, 2017)

All kind of supply of services have been covered under the GST regime. Thus, royalty of mining shall also be subject to GST at the rate of 18%. But if the royalty is tax, then no GST is payable. There is two Apex Court divergent views on this. {Query replied by: Ranu Dhoot, CA}
Dear sir, i have query regarding GST, Invoice raised in GST pre regime but Payment has not received post GST regime, So dealer chaged intt. on non payment of customer. is GST applicable on this amount or not. Shivam Gupta (Posted On: 20 Jul, 2017)

Since invoice has been raised, therefore VAT/excise has been paid upon clearance/sale of goods. So, it can be concluded that such a case was subjected to earlier laws. Thus no interest is liable to be paid on interest on delayed payments as there was no such requirement in earlier laws. {Query replied by: Ranu Dhoot, CA}
Dear Sir What is HSN Code for issue of Invoice regarding following services :- (1) Renting of Immovable Property (2) Business Support Services SUNIL SAHU (Posted On: 19 Jul, 2017)

1) HSN code for Rental or leasing services involving own or leased residential property is 997211 And for Rental or leasing services involving own or leased non-residential property is 997212 2) HSN for Business support services is 9985 {Query replied by: Ranu Dhoot, CA}
Sir, Whether deemed credit (ITC) under gst will be available to textile industry. If i have stock of grey cloth as on 30.06.2017, can i claim deemed ITC benefit ? Mayank taparia (Posted On: 19 Jul, 2017)

As per provisio to Section 140(3) of CGST Act, 2017, if a trader does not have duty paying document then also the credit will be allowed on deemed basis. Further Rule 117 (4)(a)(ii) allows credit 2 40/60% of CGST paid on goods. But clause (b) of this rule says that it should not be unconditionally exempt from payment of excise duty. Since the textile was not unconditionally exempt under Central excise, the credit of tax paid shall be availale. Hence, if you are a trader, then you can avail input credit at the rate of the rate of 40% of CGST paid (2.5%)on such goods as duty payable on textile is 5% only. {Query replied by: Ranu Dhoot, CA}
Respected Sir, Am I avail the input credit on clossing stock which I purchase from ssi units ( excise exempted).Meaning 60% of excise duty on dehalf of without providing excise paid bill. anish (Posted On: 17 Jul, 2017)

As per Proviso to Section 140(3) of CGST Act, if you are a trader, then you can avail input credit at the rate of the rate of 60% on such goods which attract central tax at the rate of 9% or more and 40% for other goods of the central tax applicable on supply of such goods after the appointed date and it shall be credited after the central tax payable on such supply has been paid. The condition given in Rule 117 (4) (a)(ii) says that it should not be unconditionally exempt from payment of duty. This has created confusion. The SSI exemption availed on goods implied that the credit will not be available on the same. But it will not lead unconditional exemption notification. Hence, if we follow this analogy then credit is available on the same. In case you are manufacturer or service provider, you cannot claim the same. {Query replied by: Ranu Dhoot, CA}
Dear Sir, GST on GTA services paid under RCM basis for specific registered recipient. In service tax law ITC not available for this. Can ITC available under GST or same provision applicable. Anupam Sethia (Posted On: 15 Jul, 2017)
Dear Sir, If a restaurant using services of food panda or sweggy then can it opt for composition scheme? Vinod Pawar (Posted On: 14 Jul, 2017)

Section 10(2)(d) of the CGST Act, 2017 specifically states that if a person is engaged in making any supply of goods through an electronic commerce operator who is required to collect tax at source under section 52, then he cannot opt for composition levy. Thus if a restaurant is taking services of e-com operator then it cannot opt for composition levy scheme. {Query replied by: Ranu Dhoot, CA}
Dear Sir, Can a business take credit of hotel bill submitted to it? Vinod Pawar (Posted On: 14 Jul, 2017)

Yes you can take credit of the hotel bill provided the accommodation was taken for business purposes and name the bill bears the name of firm/company. {Query replied by: Ranu Dhoot, CA}
what is position of RCM in tax free goods transpotation. firm is ragister GST because inter state sales and himmali paid above 5000 rs per day what is RCM dinesh kabra (Posted On: 13 Jul, 2017)

RCM is payable even on tax free goods transportation unless specifically exempt. As you have not mentioned the goods, we cannot further comment on the same. Since, the amount paid to an unregistered person in form of himmali is more than Rs 5000 in a day, then GST shall be payable on full amount ignoring the exemption benefit. {Query replied by: Ranu Dhoot, CA}
Respected sir, I have a query pertaining to HSN code as per the new GST Act in our business. I am engaged in a manufacturing business of rajputi suits. We get many different types of fabrics of different HSN codes, out of which a single final product is made. So, what will be the HSN code for the final product produced. Looking forward for a resolution from your end. Thank you Prakash Chopra (Posted On: 13 Jul, 2017)

The HSN of the final product is irrespective of HSN of inputs. It is immaterial how many inputs are used and what their respective HSN codes are. It will fall under category of garments. The HSN code will also depend upon type of fabrics used. {Query replied by: Ranu Dhoot, CA}
we are manufacturer of ice cream branded name pappai in kerala. we have an docubt in if we are giving to employee as an free sample from ex factory any gst rate is applicable .regards.p.r.prakash prakash (Posted On: 13 Jul, 2017)

The services provided by employee to employer are kept out of purview of GST. However, if any supply is made for free by employer to employee when made in the course or furtherance of businessthen the same shall be subject to GST by virtue of Schedule I of CGST Act, 2017 which states activities to be treated as supply even if made without consideration. However, gifts not exceeding Rs 50000 in value in a financial year by an employer to an employee shall not be treated as supply of goods or services or both. Thus, if the free samples supplied are of value less thn Rs 50000 in a financial year, then no GST will be chargeable on it. {Query replied by: Ranu Dhoot, CA}
a person havng business turnover 15 lack let out residental rental income 6 lack is he required to take registration???? pls reply honeysharma (Posted On: 07 Jul, 2017)

The explanation to section 22 of CGST Act, 2017 states that “aggregate turnover” shall include all supplies made by the taxable person, whether on his own account or made on behalf of all his principals. Since the expression “all supplies” is used thus, it shall include any kind of exempt supplies too. Hence, if you have a turnover of Rs 15 lakhs and a rental income from a residential dwelling, of Rs 6 lakhs, then your aggregate turnover for purpose of registration shall be 15+6=21 lakhs. Hence you will be required to take registration. {Query replied by: Ranu Dhoot, CA}
Dear Sir I am regd. Under VAT/GST in Delhi. I have stock purchased from unregistered suppliers Am I supposed to pay reverse charge? If yes when and what about self invoice and where to submit details. Is there any provision in Tran-1? Anil (Posted On: 04 Jul, 2017)

In case of stock of goods purchased from unregistered supplier lying in stock as on 30.6.2017, there shall stand no liability to pay tax on reverse charge basis on the same. {Query replied by: Ranu Dhoot, CA}
A client involved in the construction sector wants to move shuttering tools from Chennai to his work site in Hyderabad. What is the relevant provision under GST B V Bharath (Posted On: 04 Jul, 2017)

If your client wishes to move shuttering tools from Chennai to his work site in Hyderabad then the same can be moved under the cover of delivery challan as per rule 55(1)(c ) of CGST Rules, 2017. {Query replied by: Ranu Dhoot, CA}
Dear Sir, I have got your email ID from you website. I have a query related to GST. Hoping you can solve my query with reference to section and explanation. A company has both its H.O and manufacturing unit in Pune. Manufacturing unit has been registered under GST. H.O has paid business expenses but has no taxable output supply (It is only an administrative office). Then can the manufacturing unit avail and utilize the input tax credit that is solely attributable to H.O??? If No, then whats the tax treatment of that input tax credit attributable to H.O?? will it lapse or refund can be taken?? Sir, plz reply... CA Satyajeet Singh (Posted On: 03 May, 2017)

As per section 20(2)(d) of the CGST Act 2017 “the credit of tax paid on input services attributable to more than one recipient of credit shall be distributed amongst such recipients to whom the input service is attributable and such distribution shall be pro rata on the basis of the turnover in a State or turnover in a Union territory of such recipient, during the relevant period, to the aggregate of the turnover of all such recipients to whom such input service is attributable and which are operational in the current year, during the said relevant period;” Further as per section 2(60) of CGST Act 2017 “input service” means any service used or intended to be used by a supplier in the course or furtherance of business. So first of all, any expenses paid by the HO as business expenses shall be considered as an expense for the furtherance of business. Thus the HO needs to take registration under the GST regime as Input Service Distributor, then it will be able to distribute the input tax credit of the business expense to its manufacturing unit even if the expense is solely attributable to the HO, since under the GST regime it shall be considered as an expense for furtherance of business. {Query replied by: Ranu Dhoot, CA}
sir, we are mfg. unit at gujarat we have purchase capital goods 50% credit taken on dt. 01.04.2015 (our Bill date as 01.04.2015) and 50% provision during the year 2015-2016 and next year we 2016-2017 remaing 50% credit taken on dt. 01.01.2017. my query is in CCR rule under 1 year we can taken credit. which date we have taken credit in next year in future Audit party can take point to reverse the credit or not, any suggession said query. DEVANG SHAH (Posted On: 21 Apr, 2017)

As per Rule 4(2)(a) of Cenvat Credit Rules, 2004 the CENVAT credit in respect of capital goods received in a factory or in the premises of the provider of output service at any point of time in a given financial year can be taken only to the extent of 50% of the duty paid on such capital goods in the same financial year and balance 50% credit can be taken in at anytime in any of the subsequent financial years. {Query replied by Ranu Dhoot, CA}
We are a manufacturer booking hotel room for employee for some business promotion meeting. Can we avail the service tax credit of particular hotel bill? shrikant (Posted On: 12 Apr, 2017)

Yes you can avail the service tax credit of such hotel bill provided your,i.e. manufacturer’s name is mentioned on the bill. {Query replied by-Ranu Dhoot,CA}
Dear Sir, I had query on levy of ST on renting of immovable property. Heavy deposits taken and nominal rent is charged p.m. Query is whether ST shall be levied only on the nominal rent charged or deeming fiction shall come into picture also asking to levy ST on the heavy deposit compensating for the rent? Thanks and Regards, payal PAYAL CHAUHAN (Posted On: 21 Feb, 2017)

The value of taxable services is the gross amount charged by the service provider for such services provided or to be provided by him, thus the terms “gross amount charged” and “such service” have to be read in context and in tender with each other Thus, in case of refundable security deposit not retained by assessee, cannot be considered as a consideration instead it is a condition of the contract and not consideration. Hence, service tax is not applicable to any amount that is refundable and collected from the tenant as security or rental deposit. However, if security deposit has been adjusted against rent payable then such security deposits will be liable to service tax. It is worth noting that the non-refundable deposit will be subject to service tax. This view has been further supported by Advance Ruling in case of EMERALD LEISURES LTD. 2016 (41) S.T.R. 321 (A.A.R.) {Query replied by- Ranu Dhoot,CA}
Does the trailers used for transport of vehicles attracts service Tax? Yes, under which head & who is liable to pay service tax? Bhavya Shah (Posted On: 12 Feb, 2017)

The query isn’t clear. Mere use of trailer does not attract Service tax however, renting or hiring of trailers used for transport of vehicles shall attract Service Tax. As per Section 65(105)(zzzzj) of Chapter V of Finance Act, taxable service means any service provided or to be provided to any person, by any other person in relation to supply of tangible goods including machinery, equipment and appliances for use, without transferring right of possession and effective control of such machinery, equipment and appliances. The Service provider is liable to pay tax. {Query replied by-Ranu Dhoot,CA}
Dear Sir, according to the budget announced by FM on 01-02-17 is there any duty rate change on the CETSH NO.68109990 & 26060020 as till 31-1-17 it was 12.5% then from 01-02-17 it would be 12.5% or else. Please reply. THANKING U. hitesh (Posted On: 02 Feb, 2017)

As per the budget announcement on 01.02.2017, there has been no change in rate of excise duty in the CETSH NO.68109990 & 26060020 and thus they continue to be taxable @ 12.5% {Query replied by- Ranu Dhoot,CA}
Dear Sir, as u know that FM has announced the budget on01-02-17 then my query is that is there any change in the turnover limit of 1.5 cr. in excise or is there any change please reply. hitesh (Posted On: 02 Feb, 2017)

No there has been no change in the limit of SSI Exemption. The exmption continues to be on first clearances up to an aggregate value not exceeding one hundred lakh Nil rupees (1.5 crores) made on or after the 1st day of April in any financial year. {Query replied by-Ranu Dhoot,CA}
i have bought an under construction apartment in banglore . the builder is levying st and vat also. in view of the delhi high court judgement on the issue taht if construction is accompnied with transfer of land no taxes are applicable.please clarify whether i should pay the taxes and if the judgement is applicable to karnataka laws thanks ajay (Posted On: 28 Jan, 2017)

The said judgment of Delhi High Court has been further challenged and the final decision on this issue has not been passed yet. Thus you need to pay the taxes as of now. Also, the government has brought the retrospective amendment for the same. {Query replied by-Ranu Dhoot,CA}
We do business from Pune We are registerd for VAT and CST We do not have a EXCISE REGISTRATION as we are small time dealers in Industrial goods We want to import a few items from abroad and sell them to customers Are we allowed to passon the CENVAT / MODVAT benifits to the customers Means can they claim it back if yes please let us know how AJIT NAIK (Posted On: 27 Jan, 2017)

As per amendments made to central excise legislation (Notification no. 6/2014 Central Excise (N.T.) dated 26 February 2014 and Notification no. 7/2014 Central Excise (N.T.) dated 26 February), registration has been made mandatory for an importer who wishes to pass Cenvat credit under the cover of an excise invoice. The invoice issued by a registered importer would be a valid document for availing of Cenvat credit by the dealer/customer. Hence, in case you wish to transfer Cenvat credit of the imported goods to your customer, you would be required to register as an importer under the central excise legislation. In such case, your customers can take Cenvat credit based on the excise invoice issued by you. Further, please note that a registered importer is also required to file quarterly returns in the specified format within 15 days from the close of each quarter. {Query replied by- Ranu Dhoot,CA}
Water bottle is MRP based product Can assesee declare 2 MRP on same water bottles Say Rs. 20 for retail sale and Rs. 10 for hotel/caterers for own consumption . Accordingly duty will be paid on MRP less 45% abetment. Fact is in case of Rs.10 MRP, the assessable 5.5 is less than selling price of Rs.8.. so excise will be paid on 5.5 only ? thanks Amit Maru (Posted On: 26 Jan, 2017)

Yes, assessee may declare more than one MRP on an excisable good. There is no restriction on the same. When on Packages of any excisable goods, more than one Retail Sale price are declared, The maximum of such Retail Price shall be deemed to be the Retail sale price for purpose of Section 4A of Central Excise Act, 1944. Thus, even in case when you sell water bottle for hotel/caterers at Rs. 10, the RSP for Purpose of Valuation shall be Rs. 20, thus Excise duty shall be payable at Rs 20 less 45% abatement that is Rs. 9. Thus assessable value for purpose of calculating Excise duty shall be Rs(20-9) i.e. Rs. 11. {Query replied by-Ranu Dhoot,CA}
hi I am Venkat , we are Clearing & Forwarding Agent Do we have any restrictions for taking Input Service Tax ? can we take input for what we pay to our vendors ? Please regars Venakt Venkat - Wheels Shipping (Posted On: 23 Jan, 2017)

There are no restrictions on taking input tax credit by Clearing & Forwarding Agent if services provided by him are taxable. However if you are also providing any exempted sevices then RULE 6 of Cenvat Credit Rules,2004 shall apply. {Query replied by-Ranu Dhoot,CA}
Is it mandatory to submit the hard copy of documents to Jurisdictional Inspector for Service Tax Registration. Jawahar (Posted On: 20 Jan, 2017)

Yes, it is mandatory to submit the hard copy of documents to Jurisdictional range office for Service Tax Registration. {Query replied by-Ranu Dhoot,CA}
Dear Sir, We are engaged in furniture manufacturing.We are registered under Central Excise and Service Tax also.We take Excise exemption under 08/2003 CE.We received material for Jobwork and return after jobwork. They charged excise on finished goods at the time of clearance. my question is we are required to charge service tax on Jobwork amount.if no need to charge please give me under which section it is exempted. Please help me. Satish Kumar (Posted On: 17 Jan, 2017)

No service tax is payable on ‘any process amounting to manufacture or production of goods’ by job-worker, as that activity falls under the negative list under Section 66D (f) of the Finance Act, 1944. Also, S. No. 30 (c) of notification no. 25/2012-ST dated June 20, 2012 exempts ‘carrying out any intermediate production process as job-work in relation to any goods on which appropriate duty is payable by the principal manufacturer’. As the excise duty on finished goods is being paid at the time of clearance by the principal manufacturer, hence you shall be allowed benefit of exemption from payment of service tax on job work done by you. {Query replied by- Ranu Dhoot, CA}
Sir, Service provider and service receiver falls under the same group of companies having different premises and different service tax registration whether service tax liability will araise on services. Kindly clarify. srinivasankk (Posted On: 11 Jan, 2017)

Service Tax Code/Registration number is generated based on the PAN issued by the Income Tax Department. If both the entities are have their registrations based on same PAN then this will imply that they are same person only. Thus service to self is not covered under gamut of Service tax Act and thus not liable to service tax. However if both entities have got registrations based on separate PANs then they shall be considered as two different persons and thus transaction between them shall be chargeable to Service Tax. {Query replied by-Ranu Dhoot,CA}
Dear sir, We are providing lights and other shooting equipment to our clients under supply of tangible goods & services , one of our clients who is from London is doing a film shoot in India (Punjab). We are providing them with Cinematographic equipments at the said location and we are raising an invoice in foreign currency , amount will also be received in foreign exchange. So In this case service tax need to charge or not, or it will be treated as export of service under the following situations a) movie is not released in india b) movie released in india and worldwide Please clarify if the location of release of the said movie will have any impact on the taxation or not. i have already post this query on 30.12.2016 still waiting for reply thanks in advance uday singh negi (Posted On: 11 Jan, 2017)

As per Rule 4(a) of Place of Provision of Services Rules 2012, the place of provision of services provided in respect of goods that are required to be made physically available by the recipient of service to the provider of service, or to a person acting on behalf of the provider of service in order to provide the service shall be the location where the services are actually performed. Since in your case you are providing Cinematographic equipments at the Punjab, thus place of provision shall be Punjab, India. Hence Service tax needs to be charged irrespective of the fact where the movie is released. {Query replied by-Ranu Dhoot,CA}
If a SSI unit pays duty by mistake in a few invoices at any point in a F/Y, will he be debarred from the SSI benefit for the remaining period of the Financial Year jagannath prasad (Posted On: 11 Jan, 2017)

The language of the exemption notification states that “ A manufacturer has the option not to avail the exemption contained in this notification and instead pay the normal rate of duty on the goods cleared by him. Such option(Option to avail SSI exemption) shall be exercised before effecting his first clearances at the normal rate of duty. Such option shall not be withdrawn during the remaining part of the financial year.” Thus it is clear from the language that any option once availed cannot be withdrawn for remaining part of the year. In the said case since the SSI has paid duty in few invoices it will be debarred from SSI Exemption for remaining part of the year and shall have to pay duty on all the other invoices too. {Query replied by- Ranu Dhoot, CA}
v r providing workscontract services. Can v take the credit of the service tax paid on transportation charges(inward) paid on raw materials bought by us. prashanth r kamath (Posted On: 06 Jan, 2017)

Under rule 2A of Service Tax (Determination of Value) Rules, 2004, explanation -2 provides as follows. “for the removal of doubts, it is clarified that the provider of taxable service shall not take CENVAT credit of duties or cess paid on any inputs, used in or in relation to the said works contract, under the provisions of CENVAT credit rules, 2004”. Thus the provider of works contract service cannot take CENVAT credit of inputs (goods) used in relation to the execution of works contract. There is no restriction on claiming the CENVAT credit of Input Services and Capital Goods. Thus the provider of works contract service can claim CENVAT credit of Input Services and Capital Goods as per the CENVAT Credit rules 2004. {Query replied by-Ranu Dhoot, CA}
Dear Sir, In Capital Goods Excise Duty First 50 % Credit Taken But Balance 50 % when credit take. Regards, PATEL@284300 ANGEL PIPES & TUBES PVT LTD (Posted On: 03 Jan, 2017)

As per Rule 4(2) (a) of the Cenvat Credit Rules, 2004,the CENVAT credit in respect of capital goods received in a factory or in the premises of the provider of output service at any point of time in a given financial year shall be taken only for an amount not exceeding 50% of the duty paid on such capital goods in the same financial year. Thus, restriction for taking Cenvat Credit on capital goods is prescribed only for the financial year in which it is purchased. So the assessee can take 50% balance Cenvat Credit in any of the subsequent years either partly or full. {Query replied by- Ranu Dhoot, CA}
Dear Sir , What is the rate of GST on construction services? WR AMIT GUPTA amit gupta (Posted On: 30 Dec, 2016)

There is still no clarity on the tax structure applicable to the real estate and the construction sector under the goods and services tax (GST) tax regime. No definite GST rate has been declared yet. {Query replied by- Ranu Dhoot,CA}
As per Model GST Law, Supply to and by SEZ unit and ZEZ Developer not subject to GST. Then which tax will be applicable for clearance from DTA to SEZ? SANJAY S GUJAR (Posted On: 28 Dec, 2016)

As per Section 7(5)(b) of Integrated Goods and Service Tax Act,2017 the supply of goods or services or both, to or by a Special Economic Zone developer or a Special Economic Zone unit shall be treated to be a supply of goods or services or both in the course of inter-State trade or commerce. Hence, IGST tax shall be applicable on supply by DTA to SEZ Unit and SEZ Developer . {Query replied by-Ranu Dhoot,CA}
In GST, is there is provision to carry forward Cenvat Credit closing balance lying with Depots ( in RG23D Register). If yes, pl. have the Section of Model GST Law. SANJAY S GUJAR (Posted On: 28 Dec, 2016)

As per Section 140(3) of GST Act depot of a manufacturer, shall be entitled to take, in his electronic credit ledger, credit of eligible duties in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the appointed day subject to the certain conditions. Where the depot possesses invoice or other prescribed documents evidencing payment of duty under the existing law in respect of such inputs, provided such invoices or other prescribed documents issued are not older than 12 months prior to the appointed day, then the Credit can be taken on the basis of such invoices. Where the depot is not in possession of an invoice or any other documents evidencing payment of duty in respect of inputs, then, such registered person shall be allowed to avail credit at the rate of 40% of the central tax applicable on supply of such goods after the appointed date and shall be credited after the central tax payable on such supply has been paid, as prescribed in Transition Rule (3)(a). {Query replied by- Ranu Dhoot, CA}
Dear Sir What is the effective rate of duty to be collected by manufacturers on gold ornaments? is it only 1% or 1.03%? Waiting for your reply eagerly.. Regards Pushkar Mitra Pushkar Mitra (Posted On: 21 Dec, 2016)

Excise duty at the rate of 1% is to be collected on articles of jewellery. {Query replied by-Ranu Dhoot,CA}
Sir, We are a dealer of cement products and cement , we are not able to understand that is there VAT or Service Tax payable on outward freight and labour charged from end user to deliver sold material at their door step or not? , if service tax to be charged than what is the percentage ? , we are mentioning Outward Transportation charges and labour in retail Invoice alos. NAJA ZALA (Posted On: 15 Dec, 2016)

Service tax shall be leviable on outward freight and labour charged from end user to deliver sold material at their door step. The service tax shall be chargeable @ 15%. {Query replied by-Ranu Dhoot,CA}
i m working with a cotton exporter firm located in mumbai and this firm have vat-cst registration in maharashtra, gujarat, punjab and madhya pradesh states. our partners says after implementation of GST there will no need to have GSTIN Numbers in various states for traders. Registration in Maharashtra state (single registration ) are enough to do business across the country and exports. (its trouth... please advice) sandeep (Posted On: 13 Dec, 2016)

As per Section 22(1) of The Central Goods and Service Tax Bill, 2017 “Every supplier shall be liable to be registered under this Act in the State or Union territory, other than special category States, from where he makes a taxable supply of goods or services or both, if his aggregate turnover in a financial year exceeds twenty lakh rupees” This makes it clear that if assessee makes supply of goods or services or both from a different state then he will be required to get separate GST registrations for such locations separately in concerned states. This has been further clarified in the FAQs on GST that a person operating in different states, with the same PAN number and is liable to take registration will have to get registered separately for each of the States where he has a business operation and is liable to pay GST in terms of Sub-section (1) of Section 22 of the CGST/SGST Act. {Query replied by: Ranu Dhoot,CA}
Dear Sir We receive Management Consultancy services from one of our retired employee hence would like to know the applicable of service tax, if the employee (Consultant) has to pay if yes then can he take the benefit of threshold limit of Rs 10 Lakhs. atul (Posted On: 01 Dec, 2016)

As per the definition of service, only services provided by employee to employer during the course of employment are excluded. In the present case, as the employee is retired, the exclusion clause will not apply. Hence, the Management Consultancy Services provided by employee will be leviable to service tax. The employee can avail the benefit of threshold exemption limit of Rs. 10 Lacs. {Query replied by: CA Neetu Sukhwani}
Sir,We are a Auto components manufacture. we have received supplementary invoice from First stage dealer for differential Excise duty. Can we avail cenvat credit for the above. K SRIDHAR (Posted On: 24 Nov, 2016)

As per Rule 9 (1)(b) of the Cenvat Credit Rules, 2004, cenvat credit may be taken on supplementary invoice issued by manufacturer or importer, that too, except in cases of fraud. In the present case, supplementary invoice is issued by First Stage Dealer for which there is no specific provision. Accordingly, it is advised not to avail cenvat credit on the said supplementary invoice. {Query replied by: CA Neetu Sukhwani}
Sir, whether CESTAT HAS DELIVERED FINAL JUDGMENT the case of MUMBAI POLICE Vs COMMISSIONER OF SERVICE TAX, MUMBAI-I Citation:-2014-TIOL-2173-CESTAT-MUM - REGARDS, MOHAN MOHAN K IYER (Posted On: 20 Nov, 2016)

No. The Final Order regarding leviability of service tax on security services provided by Police Department has not been passed till date. Although, the final hearing for the cases pertaining to Rajasthan jurisdiction was convened in Delhi Tribunal but the order has been reserved and has not been passed till date. ' {Query replied by: CA Neetu Sukhwani}
currently GTA & other service provider who r providing services to body corporate not registered as service tax is payable by body corporate under full reverse charge. UNDER GST THESE PERSON GTA & OTHER SERVICE PROVIDER PROVIDING SERVICES TO BODY CORPORATE WOULD REQUIRE REGISTRATION ?? Kiran Patil (Posted On: 08 Nov, 2016)

Although, there is indication in Revised Draft Law regarding the fact that GST will be payable under reverse charge mechanism for certain supplies. However, whether reverse charge mechanism will continue for GTA services will be clear only after issuance of notifications in the GST regime. The Revised Draft law is silent as regards this point. {Query replied by: CA Neetu Sukhwani}
currently GTA & other service provider who r providing services to body corporate not registered as service tax is payable by body corporate under full reverse charge. UNDER GST THESE PERSON GTA & OTHER SERVICE PROVIDER PROVIDING SERVICES TO BODY CORPORATE WOULD REQUIRE REGISTRATION ?? Kiran Patil (Posted On: 08 Nov, 2016)

lthough, there is indication in Revised Draft Law regarding the fact that GST will be payable under reverse charge mechanism for certain supplies. However, whether reverse charge mechanism will continue for GTA services will be clear only after issuance of notifications in the GST regime. The Revised Draft law is silent as regards this point. {Query replied by: CA Neetu Sukhwani}
Sir We are hotel accomodation service provider to corporates and bill them with service tax as per current rules and corporates avail input credit for our services.In GST regime can the corporates avail input credit. Regards Balakrishnan 7337363345 balakrishnan (Posted On: 02 Nov, 2016)

There is no restriction for credit availment as regards accommodation services by corporates as far as they are used for providing taxable outward supply. However, as per Section 17 (4)(b)(i), no cenvat credit shall be allowed for supply of goods and services namely food and beverages except when such supply is used by registered taxable person for making outward supply of same category of goods and services. Consequently, credit with respect to supply of food and beverages will be available only if they are used for making outward supply of food and beverages. Hence, only credit of accommodation services may be availed by corporates. {Query replied by: CA Neetu Sukhwani}
Dear Respected Sir, Department is calling information of Room rent received from Patient by a clinical establishment or hospital. Please guide whether it will cover S.N.2 of 25/2012 in health care service or not. Because Room rent received from patient during the serious treatment under and supervision of doctor. thanks with due regards CA Praveen Bansal (Posted On: 27 Oct, 2016)

In our opinion, the room rent received from patient by a hospital is covered by exemption to serial no. 2 of Mega Exemption Notification. This is for the reason that it provides exemption to Health Care Services which is defined as any service by way of diagnosis or treatment or care for illness. It is submitted that when a patient stays in hospital, it is for care and treatment and will be bundled with the main service of health care services. {Query replied by: CA Neetu Sukhwani}
Dear Sir, We r SSI Mfg. unit fill Excise Return ER-1 Monthly basis. Our mistake in Nov15 ER-1 return we have show ass. value Rs. 2600000.00 insted of Rs. 260000.00 we have duty paid 12.5% correctly on Rs. 260000.00 which is show correct in ER-1 and paid, now our range supre. preliminary scrutiny of ER-1 return during the month he is issue demand notice and diff. duty amount, interest and penalty under rule 8(2) of CE 2000 to be payable. in ER-1 by typing mistake in show ass. value. pl. guide to us and how to reply any rules under this issue. devang shah 9904779686 Devang Shah (Posted On: 25 Oct, 2016)

You can establish the fact regarding the value of actual clearance of goods by enclosing copy of RG-1 register, copies of invoices during the said period. It can be pleaded that there was only typographical error but the genuineness can be substantiated by the enclosed documents. {Query replied by: CA Neetu Sukhwani}
Sir, we are manufacturer, we have received some excise bill in old rate @ 12%, 2%, 1%, how I will credit this excise duty? Is it allowed for us ? Milan Saha (Posted On: 16 Sep, 2016)

You can avail cenvat credit of basic excise duty without any doubt. However, the cenvat credit of education cess and SHE cess can be availed if the goods were received after 01.03.2015 as per Notification no. 12/2015-C.E. (N.T.) dated 30.04.2015. Query replied by: CA Neetu Sukhwani
assess register under central excise and service tax, assess file both excise er1 and ST3, assess pay service tax under reverse charge and adjust the same with output excise duty, whether assess has to show service tax availed in er1 month wish or show when service tax is actually utilize CA Ankur Agarwal (Posted On: 30 Aug, 2016)

The assessee will reflect the total amount of service tax credit availed both in Excise and Service Tax Returns. Furthermore, there is provision of reflecting the amount of service tax credit used for discharging excise duty liability and the amount of excise duty liability used for discharging service tax liability in the returns. Query replied by CA Neetu Sukhwani
Dear Sir, Suppose, Service tax was payable on 6th August,16. And we deposited the same on 16th August,16, but without interest. Now, on 24th August, 2016 we want to pay the interest. Whether the earlier amount paid by us will be adjusted towards interest upto 16th August? And now again we have to consider the unpaid interest as tax and pay interest from 16.08.2016 to 24.08.2016?? Nupur Chopra (Posted On: 25 Aug, 2016)

There is no interest on interest under Service Tax Laws. You are required to calculate interest only for the period from 06.08.2016 to 16.08.2016 on the service tax amount. Query replied by: CA Neetu Sukhwani
Respected Sir/ Madam Whether exemption of Rs. 10 lac will be available onetime means first time not thereafter in each year in Service Tax if in next years total receipts are more than Rs. 10 Lac Pradeep Parihar (Posted On: 23 Aug, 2016)

Service tax exemption is available as far as the taxable receipts in the preceding financial year are less than Rs. 10 Lakhs. This is not one time exemption and may be availed for any number of years. Query replied by: CA Neetu Sukhwani
Sir I have registered with central excise for manufacture of generators on 26-06-2016. I have not done sales yet. Also my turnover will not cross 4 crores in this current financial year. Can i file ER-3? and do i need to file the return for june month since my registration was on 26-06-2016? Give me guidance to avoid late filing penalty? Parameswaran (Posted On: 21 Aug, 2016)

You are required to file ER-3 returns even if there is no clearance of excisable goods in order to avoid penal consequences. This is for the reason that assessee is also required to file NIL returns if he is registered with the Central Excise Department. Query replied by CA Neetu Sukhwani
Can banking company avail full cenvat credit on capital goods without reversing 50 % as provided under rule 6(3B) of cc rules 2004 C A S S Gaur (Posted On: 11 Aug, 2016)

The Rule 6(4) of the Cenvat Credit Rules, 2004, cenvat credit on capital goods is denied only if they are exclusively used in provision of exempted services. Since, the banking companies provide both taxable and exempted services, they are entitled for full cenvat credit on capital goods. The provision for 50% reversal is only for inputs and input services. Query replied by: CA Neetu Sukhwani
Sir I want to know that a residential hotel have a room of Rs 999/- and a extra peson charge is 250/- than it is under service tax or not. Ashutosh (Posted On: 01 Jul, 2016)
WITH REGARD TO REVERSE CHARGE LIABILITY ON ANY SERVICES PROVIDED BY GOVERNMENT : 1)IS THERE ANY REVERSE CHARGE LIABILITY ON THE ROYALTY AND/OR DEAD RENT PAID DIRECTLY TO THE MINING DEPARTMENT. 2)REVERSE CHARGE LIABILITY IN CASE WHERE GOVERNMENT AGENTS/GOVERNMENT CONTRACTORS COLLECT ROYALTY ON BEHALF OF MINING DEPARTMENT/GOVERNMENT. THANK YOU. ADITYA POKHARANA (Posted On: 25 Jun, 2016)

Service tax shall be chargeable on the royalty or rent paid to government under reverse charge mechanism as w.e.f 1.4.2016 almost all the services provided by government have been made taxable. Earlier, only support services provided by government were taxable but now, any services provided by the government are taxable. Moreover, as the exceptions to the reverse charge are only services of posts and transport of passengers or goods, and airport services, service tax in the present case will be payable under reverse charge mechanism. Therefore, royalty paid to mining department shall be chargeable to service tax under reverse charge mechanism and tax has to be paid by the service receiver. However, in case of royalty paid to government agents/contractors, service tax will be payable by such government agents or contractors. {Query replied by: Prayushi Jain}
Issue - 1 Mr. A is mutual fund agent. His turnover in FY 2015-16 is Rs 30 lacs. Till 31-03-2016 this service is under RCM. Now In current FY (01-04-2016 To 31-03-2017) whether he can avail SSP Exemption (33/2012) or he has to pay service tax without considering 10 Lacs. Issue - 2 Mr.A is Life Insurance Agent & Mutual Fund Agent. Life Insurance service is under RCM and Mutual Fund service is under Forward Charge. If say for Example his turnover in Current FY(01-04-2016 To 31-03-2017) from Life insurance commission is rs 9,00,000 and rs 8,90,000 from mutual fund commission. whether he has to apply for service tax registration or not. ujjaval chaniyara (Posted On: 21 Jun, 2016)

In respect for your query we reply that:- issue1: Mr A is not entitled for SSI exemption as the turnover in preceding financial year is more than Rs. 10 Lakhs. Issue 2: No, Mr A is required to get service tax registration as for computing the SSI exemption limit, as the total turnover will be considered for the purpose of calculating the threshold limit of Rs. 10 lacs. Moreover, even otherwise, turnover of preceding financial year was Rs. 30 lacs , beyond the threshold limit so service tax is required to be paid in case of Mutual fund commission income. {Query replied by: Prayushi Jain}
Sir, If a manufacturer sale material As Such to a dealer. then what would be the position of the dealer. First Stage or Second Stage ? The material which is passed As Such is not registered as input with excise department, As we don't use it in manufacture of final product.We are doing Trading in that material LALIT PRAJAPAT (Posted On: 18 Jun, 2016)

In respect of your query we reply that manufacturer cannot pass on credit in case of goods which are not input for manufacturer. Consequently, in order to pass on credit, the manufacturer is required to take registration as dealer. In such a case, the position of the dealer to whom goods will be sold by the manufacturer will be second stage dealer. Without manufacturer taking registration as dealer, the credit cannot be passed on. {Query replied by: Prayushi Jain}
Sir, A person (individual) is giving consultancy in the field of interior design to a company(Co is also in the field of corporate interior design and consultancy) and he is responsible for project management direction,oversee project execution & resolve project escalations by collaborating with client and he is accountable for overall project to be finished within time.He is working as pure consultant to the company. Under which service category, he is liable to register and pay service tax. Thanks in advance sir. Mahendra Jain (Posted On: 17 Jun, 2016)

In respect of your service we reply that you may take registration under a number of services provided by you like interior designer, consultancy service or in business support services and pay service tax on services provided under respective heads. Even otherwise, you may take registration under the main service provided by you say Consultancy Services and pay service tax under that category as the concept of bundled services has been introduced. Moreover, there is no difference in service tax rate in above mentioned categories of service so it is immaterial under which category service tax is paid by you. {Query replied by: Prayushi Jain}
Is PRS/LD/Penalties from Vendors & Contractors chargeable to Service Tax Abhinandan (Posted On: 15 Jun, 2016)

We are unable to understand meaning of PRS. However, service tax is chargeable on liquidated charges/Penalties from vendors & contractors for termination of contracts as it shall be covered under clause (e) of declared service list i.e. Agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act. {Query replied by: Prayushi Jain}
sir, One of my client is engaged in jewellery manufacturing through job workers. Can he charged excise from his cutomers a his sale invoice and when excise liability arise upon him at the time of removal of goods from job workers premises ar at the time of sale from his showroom? CA AKHILESH NARAYNA (Posted On: 14 Jun, 2016)

We submit that job worker has been made exempt from the payment of excise duty and the excise duty is to be paid by principal manufacturer. Hence, your client is liable to pay excise duty and he can charge it from the customers at the time of removal of jewellery from his showroom. {Query replied by: Prayushi Jain}
Hello sir, My Query is whether tailoring, stitching covered under the meaning of services and liable to service tax. piyush bafna (Posted On: 13 Jun, 2016)

In respect of your query we reply that tailoring and stitching are not liable to service tax as both of these procedures amount to manufacture and hence are covered under section 66D(f) pertaining to negative list. {Query replied by: Prayushi Jain}
Dear Sir, My query is that one of my clients is manufacturing exemption product regarding cetsh no.25051011 now the query arises that do we have to mention the production & clearance details of exempt. product in ER-1 or not.Please reply. hitesh (Posted On: 13 Jun, 2016)

Yes, the details i.e. opening, production and clearances of exempted product have to be shown in ER-1 return. {Query replied by: Prayushi Jain}
How to pass a journal entries for payment of proprietor's child school fee? M.N.JHA (Posted On: 06 Jun, 2016)

We only deal in excise, custom and service tax matters. {Query replied by: Prayushi Jain}
Sir, kindly know us, whether interest is exempted on payment of excise duty for jewellers from march2016 to may2016 on or before 5th of june2016 SRIPATHI BHATTA (Posted On: 01 Jun, 2016)

As the date for payment of excise duty for jeweler has been extended upto 31.07.2016, it appears that the intention of the government is not to charge interest for duty payment from March 2016 to June, 2016, if payment is made upto 31.07.2016. However, it is pertinent to mention that the extension is by way of issuing circular and not by Notification or amendment in Central Excise Rules, 2002. Hence, as per legal provisions, department may also insist for payment of interest. {Query replied by: Prayushi Jain}
Sir, With reference to excise on jewellery my query is as under with regard to turnover: A Jeweller has following types of Turnover during FY 2014-15- Manufacturing Division Sale of Silver Ornaments Rs. 5 Crore Sale of Gold Ornaments Rs.10 Crore Trading Division (Sale after purchasing manufactured ornaments by another manufacturer) Sale of Silver Ornaments Rs. 6 Crore Sale of Gold Ornaments Rs.12 Crore A Jeweller has following types of Turnover during FY 2015-16- (upto 29.02.2016) Manufacturing Division Sale of Silver Ornaments Rs. 6 Crore Sale of Gold Ornaments Rs.11 Crore Trading Division (Sale after purchasing manufactured ornaments by another manufacturer) Sale of Silver Ornaments Rs. 4 Crore Sale of Gold Ornaments Rs.10 Crore Please explain how we will calculate gross turnover and turnover With Regard (Posted On: 09 Apr, 2016)

Jewellery manufacturers having turnover of more than Rs. 12 crore(excluding articles of silver other than silver jewellery studded with diamond, ruby, emerald or sapphire) in the previous financial year 2014 – 15 shall not be eligible for SSI exemption in March 2016. If the value of clearances in the preceding financial year 2014–15 is less than 12 crore, no Central excise duty shall be payable on 1st clearances up to Rs. 50 Lakhs in the month of March 2016. For 2016-17 the exemption for 1st clearance upto 6 Crore is available if the turnover of the previous year 2015-16 is less than 12 Crore (excluding articles of silver other than silver jewellery studded with diamond, ruby, emerald or sapphire) . Further the silver jewellery other than silver jewellery studded with diamond, ruby, emerald or sapphire is exempted from excise duty and also it is not included in computation of 12 crore. As you have not mentioned whether the Silver Ornaments are studded with diamond, ruby, emerald, sapphire. Hence we assume that silver ornaments mentioned in the query are without diamond, ruby, emerald, sapphire. In such circumstances you will be eligible for exemption upto Rs. 50 lakhs in March 2016 as your turnover in 2014-15 was Rs, 10 Crore. Further you will also be eligible for exemption upto Rs. 6 Crores in 2016-17 if your turnover (11 crore + turnover of March 2016) in 2015-16 is less than 12 Crores.
I have to pay a bill of 18500/- which i have got from a service provider. please let me know the percentage of TDS to be deducted from the bill amount? Shivani Kaushik (Posted On: 09 Apr, 2016)

We do not deal with Income Tax matters. Please ask questions related to excise and service tax.
Respected Sir I request to reply urgently because excise Return date is just near Matter is that I have filed Quarterly excise return of my client of previous quarter of Dec end of 2015 but now upto Feb., 2016 excise sale is below 4 crore but after 3rd March 2016 sale is above 4 crore and inthis case which return i have to file for my client whether ER-3 upto Feb., 2016 and ER-1 for only march 2016 pls guide me I heartly request Pradeep Parihar (Posted On: 08 Apr, 2016)

In our opinion, you have to file ER-3 for the whole quarter
Wrongly additional duty credit availed now but now i am debiting what remarks for this amount should be write Amol Togale (Posted On: 08 Apr, 2016)

Just write the reason of reversing the Cenvat Credit.
Sir I have received payment in april 2015 when service tax rate was 2.36 and now in January 2016 it has cross rs.1000000.00 of service tax limit and apply for service tax registration now in which rate I have to pay servicetax 12.36 or 14.50% santosh mehra (Posted On: 08 Apr, 2016)

If you were availing SSI exemption and your turnover has crossed Rs. 10 Lakhs in January 2016 then you have to pay service tax @ 14.5% on amount exceeding Rs. 10 Lakhs.
Hi Sir, WE Received invoice from Biryani hunt[Prop.Con] for amounting Rs.43189 inculding service tax of 14.5%. While accounting in Company books of account. we need to deduct tds ? Pl.inform. RAJESH (Posted On: 07 Apr, 2016)

We do not deal with Income Tax matters. Please ask questions related to excise and service tax.
Under RCM in GTA 7 recipients are liable to pay service tax. But if provider charging service tax can recipient take credit of the same for RCM. Amit Jain (Posted On: 07 Apr, 2016)

If liability to pay service tax is on service recipient then service recipient should pay the service tax. Cenvat Credit is different from reverse charge mechanism and credit is available to the manufacturer/service provider in respect of all input services. If the liability to pay service tax is on service provider (GTA), then you can take the credit on the basis of invoice Issued by GTA and if the liability to pay service tax is on service recipient then credit is available on the basis of GAR-7 challan/service tax payment challan.
Sir, Pl elaborate about this para in CE Notfn. No. 22/2016-NT i.e. "references in any rule, notification, circular, instruction, standing order, trade notice or other order to the Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable and other Goods) Rules, 2001 and any provision thereof shall, be construed as references to the Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable and Other Goods) Rules, 2016 and any corresponding provision thereof.” Saurabh Raj (Posted On: 07 Apr, 2016)

When the name of Rule is changed then there can be a technical difficulty to change all the provisions of the law wherever the reference of that rule is given. Therefore Government issue a common notification to give the impact of the changes in the name of the rules. As in the instant case Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable and other Goods) Rules, 2001 has become Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable and Other Goods) therefore the notification No. 22/2016-NT gives the clarification that wherever the reference of old rules is given it will be construed as reference to new rules.
Respected sir, I have 2 queries kindly enlighten me on them.We are a LLP company engaged in Jobworking i.e. manufacturing of garments where fabric, buttons etc are given by the company except thread. my query here is whether VAT is applicable or not. Secondly we are planning to come out with our own brand of garments here I would like you to inform me the taxes applicable. I have learnt that VAT is 5% and now excise duty has come into force which is complecated and I would be obliged if you would enlighten me. I have also heard that excise is applicable only after you cross a turnover of 1.5cr is this true. will be obliged to receive the details on my email. Thanks & regards Jetha Jetha (Posted On: 04 Apr, 2016)

We do not deal in VAT therefore we can’t answer your questions related to VAT. In the Central Excise, there is SSI exemption limit of Rs. 1.5 crore which is available if the turnover of assessee in the previous financial year is less than Rs. 4 crore.
Dear Sir, last date of payment of service tax for service recipient under RCM if payment made to vendor on 31.03.2016.Whether service tax is to be paid on 31.03.2016 or 5th/6th of April,2016. Sharad (Posted On: 31 Mar, 2016)

If payment made the month of march then last date for payment of service tax is 31st March. You have to pay interest after 31st march.
Dear sir, Pl provide guidance for following case Amt in lacks Shivam eng > 3RD QUARTER > Service tax received(RCM) > 3.61> Output service tax > 1.1O > 2.51 PAID TO DEPT Shivam eng > 4RD QUARTER > Service tax received(RCM) > 0.8> Output service tax > 1.75 > (-) 0.95 I had paid excess of rs 0.95 lacks. HOW CAN I GET REFUND OR TAKE CREDIT TO NEXT QUARTER HOW TO FILL RETURN pl advice at the earliest mayank dave mayank (Posted On: 31 Mar, 2016)

Your query is not clear.
Dear Experts, Please,let me know whether Rule 7 of POT will be applicable in March month also ? For example : Date of availment of service : 21st March 2016 Bill Booking Date : 25th March 2016 Date of Payment : 10th April 2016 Now in above case which date will be due date for payment of service tax ? Will it be 31st March 2016 or 5th May 2016 ? Please, reply ASAP. SARVESH BANSAL (Posted On: 30 Mar, 2016)

As per Rule 7 of Point of Taxation is related to POT in case of reverse charge mechanism. As per this Rule, the point of taxation will be date of payment to the service provider (if payment is made within 3 months) . As in the instant case date of payment is 10th April therefore due date for service tax is 5th May.
Sir, I am rendering marketing services to US based Co in selling their products in India and other parts of Asia. About 50% of the time is spent on Indian markets. I am paid lump sum amt in USD per month+ all expenses.My understanding is since goods are supplied to India based on my marketing, my services are taxable under service tax.Is this correct understanding?My services for marketing outside India is export of service hence not taxable.Notional break up 50% is this acceptable to Dept. Pl guide and help. Ramani (Posted On: 25 Mar, 2016)

In this case, the service receiver is based in US and service provider is located in India. Hence leviability of service tax is depend upon the place of provision of service. Rule 9 of Place of Provision Rules determines the place of provision in case of “Intermediary Service” as “Location of Service Provider”. Vide Notification No 14/2014 ST dated 11th July 2014, government has amended Rule 2(f) read with Rule 9 of the Place of Provision of Service Rules 2012, by replacing definition of Intermediary, to include, commission agent dealing in goods. Hence from 1st October 2014, Taxation of Commission agent service dealing in goods will be governed by Rule 9 of Place of Provision of Service Rules 2012. As per said Rule 9, Service will be deemed to be provided at the location of ‘Service Provider’. Therefore commission services provided by agent located in India to person located outside India for Import of Goods in India is taxable service from 1st October 2014, which was out of purview of service tax upto 30th September 2014. Therefore your services are taxable whether provided in India or not.
Is cenvat credit eligible on annual membership fee paid for promotion of finished goods A Ravindra.Babu (Posted On: 23 Mar, 2016)

Going by the latest decision of Mumbai CESTAT in the case of Pam Pharmaceuticals & Allied Machinery Vs CCE 2016-TIOL-708-CESTAT-MUM, wherein it was held that Membership of business club like Entrepreneur Organisations is indirectly related to the promotion of business and it forms cost of the assessable value of the finished goods. Where an expense becomes part of the cost, the Cenvat can’t be denied on such expenses. Moreover, there is no specific restriction on such Cenvat availed in the definition of the input services. Thus prima facie the Cenvat should be allowed on such expenses.
Dear sir, one of my client is engaged in the business of transport of goods by road. He is paying service tax on services provided to individuals but not for corporate bodies as per reverse charge mechanism. But company is paying service tax. Now officer is demanding all the record from those companies who have paid service tax under reverse charge. We said that it is not our responsibility. Can he demand companies records from us? GIRISH R DALVI (Posted On: 23 Mar, 2016)

No, there is no such provision in the act or rules which empowers the departmental officers to demand records of one assessee from the other. It is not our responsibility to maintain the record of the service tax paid on the freight by the companies under reverse charge mechanism. If the department wants such records, he will have to summon the companies itself for production of such records.
Sir very good after noon ..my query is ..if jewellers goes 40-41 days strick ,is there any rule in our Constitution(in Indian constitution) to roll back exise duty or any further rule ....plzz clear it. dinesh verma (Posted On: 22 Mar, 2016)

No, there is no such provision where any strike would result in roll back of any duty levied irrespective of the time involved. Levy of duty is purely a constitutional matter which is governed by the parliament itself. If the duty is to be rolled back, it has to be by a proper procedure followed by the parliament as provided in the constitution.
Respected Sir, My query is that is there any change in the rate of interest on late payment of excise duty which an exciseable unit has to pay on 5th of the next month as it is 18% till 31-03-16 now from 01-04-16 it will b 18% or else according to the budget 2016-17.Please reply hitesh (Posted On: 20 Mar, 2016)

There has been a change in the interest rate for delayed payment of excise duty. Section 11AA of the Central Excise Act has been amended vide notification no. 15/2016-C.E to reduce the interest rate from 18% to 15% w.e.f. 01st April, 2016.
ABC is CA Partnership firm with turnover 25Lacs.A forms his sole Proprietary firm at same address and provides same audit and taxation services. In next yr. turnover of A's Prop. firm is 7 Lacs and of Partnership firm is 18 Lacs. Can A claim SSI exemption of 10 Lacs in Prop. firm and not charge Service Tax? Can ST Deptt. club turnover of both firms as Associated enterprises or on mutuality of interest basis and charge ST on combined turnover of 25 Lacs. Pl. advice arun gupta (Posted On: 13 Mar, 2016)

There is no state forward rule for clubbing of value The grounds on which clearance value is normally clubbed are absence of independent existence and interdependence or interrelationship of units with financial and/ or management control being exercised by one unit or its owner over the other. The question whether different firms having common partners are treatable as separate service providers, would be a question of fact in each case to be determined on the basis of such factors among other, like composition of the partnership, establishment, nature of services etc. As in your case both firms are located in same premises, providing same services and the partner is also principal of proprietary firm therefore department may object the eligibility of exemption.
Respected Sir, One of my clients is taking the benefit of noti.no. 08/2003 regarding SSI exemption of 1.5 crore now as u know sir that the budget has been announced is there any change regarding turnover limit or it is 1.5 crore or else which we will be effective from 01-04-2016 hitesh (Posted On: 13 Mar, 2016)

In Budget 2016, there is no change in general SSI Exemption limit of 1.5 Crore [Eligibility Limit 4 Crores]. The higher exemption limit is prescribed only for jewellery manufacturers. In case of Jewellery manufacturers, if the turnover of a jeweller is below Rs. 12 crore during preceding financial year then he will be eligible for exemption unto Rs. 6 crore during next financial year.
sir let me know aboutjewel central excise duty gurusagar (Posted On: 12 Mar, 2016)

In Budget 2016, excise duty of 1% [without input tax credit] and 12.5% [with input tax credit] has been imposed on articles of jewellery. Even for this nominal 1% excise duty, manufacturers are allowed to take credit of input services, which can be utilised for payment of duty on jewellery. Articles of silver jewellery [other than those studded with diamonds, ruby, emerald or sapphire] are exempt from this duty. An artisan or goldsmith who only manufactures jewellery on job-work basis is not required to register with the Central Excise, pay duty and file returns, as all these obligations will be on the principal manufacturers [Rule 12AA of the Central Excise Rules, 2002]. There is a substantially high Small Scale Industries excise duty exemption limit of Rs. 6 crore in a year [as against normal SSI exemption limit of Rs. 1.5 crore] along with a higher eligibility limit of Rs. 12 crore [as against normal SSI eligibility limit of Rs. 4 crore]. Thus, only if the turnover of a jeweler during preceding financial year was more than Rs. 12 crore, he will be liable to pay the excise duty. Jewelers having turnover below Rs. 12 crore during preceding financial year will be eligible for exemption unto Rs. 6 crore during next financial year. Such small jewelers will be eligible for exemptions upto Rs. 50 lakh for the month of March, 2016 Read More About Excise on Jewellery Here - http://new.capradeepjain.com/redirect_artleview_254
Dear Sir, Please clarify that RSP/MRP Rs.1000/- below CE Duty Nil (without cenvat credit) on Branded Goods of Ready made garments. Our client discharging the Bedsheet in brand Housethis and MRP Rs.999/-so please guide that he is in exempt from ce duty vide notfn 15-2016dt1/3/2016. So please explain the same. Thanks & Regards Kalpana Singh kalpana Singh (Posted On: 10 Mar, 2016)

If the MRP is less than Rs. 1000/- then excise duty rate is 1. Nil (without CENVAT credit) or 6% (with CENVAT credit)‟ in case of garments / articles of cotton, not containing any other textile material; and 2. Nil (without CENVAT credit) or 12.5% (with CENVAT credit)‟ in case of garments / articles of other composition.
R Sir M/s. A Pvt Ltd, M/s. B Pvt Ltd, M/s. C Pvt Ltd and M/s. D (Partnership firm) are engaged in the business of Jewellery. All concerns are engaged in trading of Gold, Silver, Diamond and Diamond studded jewellery (goods). All concerns also undertake the manufacturing of jewellery either from own premise and or through job worker (Karagir) on contract basis. The turnover of all concerns is above Rs 100 crores. Queries Please clarify 1. The applicability of Excise duty on clearance of goods which are readymade purchased (ornament) from outside parties and from sister concerns. 2. The procedure to be followed of sale return and documentation to be maintained thereof. 3. The re-selling of old ornament which are purchased from customers after cleaning, and minor repairing but without changing its original shape, design and appearance. 4. The applicability of Excise duty on the goods which are sold intra group companies i.e. within M/s. A Pvt Ltd, M/s. B Pvt Ltd, M/s. C Pvt Ltd and M/s. D (Partnership firm), before 29th Feb 2016 and after 29th Feb 2016. Thanks Taral N Shah (Posted On: 07 Mar, 2016)

1.Excise duty is not applicable on trading of goods therefore excise duty will not be levied on purchase and sale of readymade ornaments. 2. In case of Sales Return, Rule 16 of Central Excise Rules will apply. This procedure is mainly applied to the jewellery manufacturer opting to pay duty @12.5% and taking Cenvat Credit. He can take credit on returned goods on basis of such duty paying document. If the same is sold after repairing then credit is to be reversed and if the same is sold after manufacturing process then duty is to be paid. 3. In our opinion excise duty will not be levied on cleaning and repairing of old ornaments. 4. In case of sale to sister concern, appropriate excise duty is required to paid on value determined in accordance with the Rule 9 of Central Excise Valuation Rules:- When goods are sold by the sister concern – Value will be the transaction value at which goods are sold be the related party When goods are consumed by the sister concern – Value will be 110% of cost of production
Dear is we have purchase goods worth 10 lack duty involve 1lk in 2012 but due to quality it was rejected and vendors were issue a debit not for the same by crediting stock. However cenvat not reverse as not removal of goods out side factory. Please ans how long we can hold such goods without reversal of cenvat.can the dep say we utilised cenvat of the goods which is not a input as per FIFO method. If we again book purchase can we take the cenvat on document dated 2012. Kamlesh Neema (Posted On: 07 Mar, 2016)

Your query is not clear.
when can a newly born baby can apply for pancard. and in minimum how many days the pancard can be alotted to the newly born baby mohd aslam azad (Posted On: 06 Mar, 2016)

Although we do not deal in Income Tax/PanCard matters. But for your kind information anyone can obtain pan cared including an infant, provided, signatures be made by the parent or legal guardian in the application.
Dear Sir, Please clarify the doubts below mentioned. A partnership firm has crossed the basic exemption limit of Rs 10 lacs in the current year and may pay a small amount of service tax. It is planed to convert the firm into a pvt ltd co in the coming financial year 2016-17. Pl clarify, Can the newly converted Pvt Ltd Co claim for Rs 10 lac exemption for the financial year 2016-17 as it has separate pan no and identity other than the partnership firm which has been converted. Is there any legal provision restricting the above benefit.Pl explain and clarify with reasons. Thanking you. ramani (Posted On: 05 Mar, 2016)

Private limited company is a separate entity which require new separate registration. There is a provision in Rule 10 of Cenvat Credit in respect of transfer credit in case sale, transfer or amalgamation of business. But there is no provision in the service tax law which restricts the new entity to claim fresh small service provider exemption. Therefore small service provider exemption under service tax will be allowed separately to the newly formed company without considering the turnover of converting partnership firm. However department may raise the objection in this regard.
Sir, We are valves manufacturing company.In our case service provider who is not covered under the RCM issuing his service tax bill on us.but we are making payment to them after 6 or 7 month from the date of invoice.Here my question is that can we eligible to avail service tax credit immediately after receive bill from party ?. (Posted On: 05 Mar, 2016)

As per Rule 4(7) of Cenvat Credit Rules, 2004 - Cenvat credit in respect of input service shall be allowed on or after the day on which the invoice, bill is received. The proviso to this Rule provides that – in case payment of input service is not made within three months from the date of invoice then credit taken in respect of that input service shall be reversed. The Rule further provides that manufacturer or the provider of output service shall not be allowed to take Cenvat credit after one year from the date of issue of the invoice. Therefore you can take the credit immediately but if you are making payment of invoice after 6-7 months then you are required to reverse the credit after 3 months and the credit will allowed again only after payment of invoice. Hence it is advisable to take credit on payment basis in case, you are not making payment within3 months.
Dear Sir, We are rendering Man power supply services. As we are under reverse charges mechanism and providing to Co only tax liability is on the service receiver. As a service provider are we bound to file ST3 returns Are we bound to declare the value of services OR There being no tax liability to pay, are we free not to file the returns and be legally correct. Thanks in advance. Ramani (Posted On: 05 Mar, 2016)

As per Rule 3 of Service Tax (Registration of Special Category of Persons) Rules, 2005 - Registration under service tax is required if aggregate value of taxable service in a financial year exceeds 9 lakh rupees. Further as per Rule 7 of Service Tax Rules, 1994 – every assessee shall submit a half yearly return. Therefore if you are registered under service tax, then you are bound to file ST-3 return.
Respected Sir, in dvat return 1Q 14-15 PURCHASE of rs 200000 @5% is entered but actual purchase is rs. 400000 now i want to revise return whether TAX CREDIT of balance 200000 is available in return of 2015-16 or not preeti (Posted On: 04 Mar, 2016)

We do not deal in VAT/Sales tax. Please ask queries related to Service Tax and Excise.
Respected Sir, As u know that the budget-2016-17 has been announced so the query is that sir one of my clients is the manufacturers of electric pole & other is the manu. of grinding wheel, is there any change in the rate of duty according to the budget.As it was 12.5% till 28-02-16 so from 01-03-16 it will be 12.5% or esle.Please reply. hitesh (Posted On: 29 Feb, 2016)

You have not mentioned the actual tariff head of products. In our opinion there is no change in the excise duty of grinding wheels and electronic poles.
Dear Sir. We are in Hotel Industry. We have 32 Rooms & Restaurant. We are paying Service Tax on both Services (Accomodation & Restaurant) as per Service Tax Rule. During the Audit of Service Tax by Department found query that you are providing Food in Room but You can not charge Service Tax on Room Service (Supply of Food in Room) & also can not Charge Service Tax On Extra Bed. We want to know whether both Room Service & Extra Bed attract Service Tax ? Please give Clarification. It's urgent. Pragnesh. Pratik A Patel (Posted On: 29 Feb, 2016)

In our opinion, service tax will be levied on food served in the room as levied under restaurant service. Because, exemption is available only in respect of “serving of food by restaurant not having the facility of air-conditioning”. Further service will also be levied on the charges collected for extra bed because there is no exemption in respect this service.
Sir ji, Can you please advise on the Reverse Charge Mechanism The services provided to PORT which is exempted vide Sl No.14 of Notification No.25/2012 till 31st March 2015. The applicable services for reverse charge mechanism for Works Contract is payable under Notification No.30/2012 Now the query is a) Is Reverse Mechanism (on Works Contract) is applicable when the main service (services rendered to Port) is exempted from service tax. visuiyer (Posted On: 27 Feb, 2016)

Reverse charge is applicable only when service is taxable. When service itself is exempted then reverse charge will not applicable.
We are going to hire vehicle liek jeep/cars for providing Women Helpline services i.e. to attend to various problems faced by women like home problems, eve teasings etc. I want to know Service Tax implications thereon. On which party at which rates? kindly clarify. AJAY KUMAR AGRAWAL (Posted On: 26 Feb, 2016)

Reverse charge is applicable in case of “renting of motor vehicle” service if service provider is individual or partnership firm and service receiver is a body corporate. In such case service receiver is liable to pay tax on 40% of total value.
Dear Sir, whether RCM is applicable for works contract service if material value and service charges is seperately mentioned in the invoice and service provider is not charging service tax. If RCM is applicable than on what value service tax is calculated as per option below. Option 1: 50% of service tax @14.50% on 40%/ 70% of total value (i.e material value and service charges) Option 2: 50% of service tax @14.50% on 100% of service charge only. Sharad (Posted On: 23 Feb, 2016)

In work contract service, reverse charge is applicable if service provider is proprietor/partnership firm and service receiver is a company irrespective of the fact that material value is separately shown or not. Further if service value is separately mentioned then service tax is to be paid on service value only i.e. under Option 2.
Sirs, We are manufacturers of container (iron & steel) under chapter 73 as per chapter heading unit measure is in kgs. but our sales through numbers so can i file ER1 with unit of numbers SOY P ITTY (Posted On: 22 Feb, 2016)

Yes, you can file the return in “Units” of Numbers instead of “KGS”.
Dear Sir, Kindly guide whether Footwear Design & Development Institute (set up by Ministry of Commerce, Govt of India as a society registered under societies act, 1860) is a "government" as per the define in section 65B(26A) for the purpose of support services viz. testing services provide to business entity. In the present case Footwear Design & Development Institute charging service tax on testing services provide to business entity. Whether in this case Reverse charge mechanism (RCM) will not apply and business entity shall be liable to pay entire service tax under RCM. Sharad (Posted On: 19 Feb, 2016)

As per the definition given in section 65B (26A) “Government means the Departments of the Central Government, a State Government and its Departments and a Union territory and its Departments, but shall not include any entity, whether created by a statute or otherwise, the accounts of which are not required to be kept in accordance with article 150 of the Constitution or the rules made there under”. In our opinion, Footwear Design & Development Institute set up by Ministry of Commerce does not fall under the above definition therefore reverse charge mechanism will not apply in the present case.
Respected Sir, we are service company providing services, if we import material in relation to services. so my query is can we take credit of CVD & SAD in service tax as a Service Company. pls. provide the notification number if any. Regards Deepak Dalvi Deepak Dalvi (Posted On: 19 Feb, 2016)

As per Rule 3 of Cenvat Rules, 2004 Credit of CVD on import of material used for providing output services will be allowed. However as per the said Rule, credit of SAD will not be allowed to service providers.
Res Sir, we are manufacturer of Kangaro staionary Products, exports our goods through Merchant Exporter. pls. Advise whether we can claim exemption from Service Tax on Services of GTA for sending of goods from our premise to Merchant Exporter premise under Notification no. 31/2012 ST as no clearity is there in S.Tax regarding exemption to mftr selling goods through ME from Service Tax on any services. pls Advise with relevant Legal Support. also advise whether all exemptions available to Exporter/ME Exporter from service tax is available to mfrs selling there goods through merchant exporter. anoop (Posted On: 16 Feb, 2016)

As per notification no. 31/2012-ST following service is eligible for exemption subject to the fulfilment of other conditions of notification:- “Service provided to an exporter for transport of the said goods by goods transport agency in a goods carriage from any container freight station or inland container depot to the port, airport or land customs station, as the case may be, from where the goods are exported; or Service provided to an exporter in relation to transport of the said goods by goods transport agency in a goods carriage directly from their place of removal, to an inland container depot, a container freight station, a port or airport, as the case may be, from where the goods are exported” In view of the above, exemption will not be allowed in respect of GTA services related to transportation of goods from factory to merchant exporter.
isi accumulated education cess and secondary education cess can be utilised against payment of service tax. Beause cess is removed and submerged to tax. visuiyer (Posted On: 15 Feb, 2016)

Legally education cess and SHE Cess is not merged in service tax, it is just removed from levy. You can’t utilize the accumulated cess against service tax. Still there is no clarification in respect of accumulated credit of education cess and SHE Cess therefore, credit of cess should not be utilized against service tax.
sir, with respect to refund of 4% SAD what is the position when VAT payable is NIL. In recent judgements in the case of Ktyal Metals agencies vs CCP, Patna where the CESTAT , Kolkata ruled that SAD is refundable even when VAT is NIL. The matter was appealed in Patna High Court. The petition was dismissed restoring the verdict of CESTAT, Kolkata. Moreover in recent judgement of CESTST Anit Jain (Posted On: 14 Feb, 2016)

One of the conditions of Notification No. 102/2007-Customs related to SAD refund is as follows: “(d) the importer shall pay on sale of the said goods, appropriate sales tax or value added tax, as the case may be;” This condition requires the importer to pay appropriate VAT at time of sale. In case, VAT Rate is Nil then it can be assumed that VAT is appropriately paid but some decisions are against this argument. Further in case of Commissioner of Customs, Patna vs. Katyal Metal Agencies [2012-TIOL-1053-CESTAT-KOL], the Kolkata Tribunal while dismissing a stay petition filed by the Department held that SAD is levied to counterbalance VAT. In case the goods are exempt from VAT, the same should be exempt from SAD also. Based on this, the SAD refund on imported goods that are exempt from VAT may be claimed. However, please note that this is not the final judgment and still department may raise point that refund will not be allowed.

Respected Sir, One of my clients is a govt.contractor in GEB indulge in pole supply as few months ago govt. gave him rate hike on the supply on which he paid the duty now govt. inform him that rate hike was more due to calculation mistake so govt. inform him to pay the money which govt.paid more so now the query is that whether he can claim the duty refund from excise if yes then what is the procedure & what documents would we need.Please reply. hitesh (Posted On: 14 Feb, 2016)

In case a manufacturer pay excess duty and actually recovers lesser amount then he can file a refund based on duty payment documents and invoice subject to the condition that he has not recovered the said excess amount from the purchaser. There is no specific procedure provided for these types of refund. However you can file refund by submitting general letter alongwith relevant documents – Invoice, Duty payment Challan etc.
Respected Sir, If Advocate (individual) raise the invoice for legal services to pvt Ltd. if he charges two separate invoices for fees & other for exp reimbursement then what is the service tax liability to service receiver under RCM. or if he charges single invoice for the same then what is the service tax liability to pay service receiver under RCM Regards, Deepak Dalvi Deepak Dalvi (Posted On: 11 Feb, 2016)

In Budget 2015, Government has amended the definition of “consideration” to included reimbursement of expenses in the definition of consideration. “Consideration includes any reimbursable expenditure or cost incurred by the service provider and charged, in the course of providing or agreeing to provide a taxable service, except in such circumstances, and subject to such conditions, as may be prescribed” Therefore service tax will be chargeable on full amount including reimbursement of expenses irrespective of the fact that separate invoice is raised or not. However if all the conditions of “pure agent” is satisfied then service tax will not be levied on expenses recovered as “pure agent”. As per Rule 5(2) of the valuation rules provides that expenditure or cost that service provider incurs , as pure agent on behalf of the client, shall be excluded from the value , if service provider fulfill prescribed conditions: 1. the service provider is acting as a pure agent of the recipient of service when he makes payment to third party for the goods or services procured; 2. service receiver receives and uses the goods or services. 3. the service receiver is liable to make payment to the third party and not service provider. It is better to include this in agreement. 4. the service receiver authorizes the service provider to make payment on his behalf 5. the service receiver knows that the goods and services for which payment has been made by the service provider shall be provided by the third party; 6. the payment made by the service provider on behalf of the recipient of service has been separately indicated in the invoice issued by the service provider to the recipient of service;( Separate indication is necessary) 7. the service provider recovers from the recipient of service only such amount as has been paid by him to the third party ( No additional profit should be charged ) and 8. the goods or services procured by the service provider from the third party as a pure agent of the recipient of service are in addition to the services he provides on his own account. In case of legal service or consultancy service, generally the above conditions of pure agent can’t be satisfied therefore service tax will be levied on full value including reimbursement expenses.
Dear Sir, Please explain me, can we avail service tax credit on bill of pest control service provided to one of the manufacturing unit? Yogesh Pawar (Posted On: 11 Feb, 2016)

IF the pest control service is “used in relation to manufacture of final product” then it will be covered under the definition of “Input Service” given under Rule 2(l). In that situation, credit will be allowed.
"A" MANUFACTURES AN ITEM "X" UNDER CETISH 85381090 AND AVAILS SSI EXEMPTION . ITS TURNOVER IS RS 2.25CR. APROX. ANOTHER MANUFACTURER "B" MANUFACTURES PRODUCT "Y" FOR ITSELF, WITHOUT ANY BRAND NAME, WHICH IS ALSO UNDER CETISH 85381090 , ITS TURNOVER IS APPROX RS. 30 LAKHS . PRODUCT "Y" IS ALL TOGETHER DIFFERENT FROM PRODUCT "X" QUESTIOS IS 1. IF MANUFACTURER "A" PURCHASES PRODUCT "Y" FROM MANUFACTURER "B" WITHOUT EMBOSING ANY BRAND NAME ON PRODUCT OR ANY LABEL ON PRODUCT "Y"AND MANUFACTURER "A" , AFTER PURCHASING, EMBOSES ITS BRAND ON PRODUCT "Y" AND PACKS THE SAME AFTER LABELLING ITS BRAND AND SELLS , A. WHETER EXCISE HAS TO BE PAID BY MANUFACTURER "A" B. WHETHER ANY INTIMATION BE MADE TO CENTRAL EXCISE AUTHORITIES. C WHETER QUANTITIES OF PURCHASES OF PRODUCT "Y" BE SEPERATELY SHOWN AS MANUFACTURING IN ER-3 RETURN THOUGH PRODUCT "X" AND "Y" HAVE SAME CETISH 85381090 SHYAM SUNDER (Posted On: 08 Feb, 2016)

Packing and labelling of products covered under Tariff head 85381090 is not treated as “manufacture”. Further Product “Y” is different from product “X’ therefore Excise duty is not levied on product “Y”. Further product “Y“ is also not required to be shown in ER-3.
Can the restaurants/Food outlets operating at SEZ avail tax exemption for Service Tax & Vat on sale of food & beverages? Vivek Bahety (Posted On: 06 Feb, 2016)

Direct exemption can’t be allowed. Exemption is allowed only when services is used for authorised operation of SEZ. Further for claiming exemption, assessee is required to follow the procedure prescribed in SEZ Notification 12/2013-ST. Decision of claiming of ab-initio exemption or refund is to be taken by SEZ thereafter SEZ shall obtain approval from the approval committee and file a declaration in respect of list of services required for authorised operation. The authorization shall be issued in form A-2 to SEZ Unit and on the basis of this authorization, service provider will not charge the service in the invoice.
Respected Sir/Madam, We are private limited co. receiving canteen services who is individual. charging bill for canteen services without service tax my query whether canteen services comes under RCM. a. if comes then what is the service tax % to pay service tax to govt. b. if exempt then notification number for the same. Regards, Deepak Dalvi Deepak Dalvi (Posted On: 06 Feb, 2016)

First of all Canteen Service is not covered under the Reverse Charge Mechanism. Further Canteen Service provided by a canteen maintained in a Factory registered under Factories Act having facility of air-conditioning or central air-heating at any time during the year is exempt from service tax under Mega Exemption Notification 25/2012-ST. However reverse charge is not applicable in this case but if the canteen service is not provided in the factory canteen and service provider is not covered under SSI exemption then service tax will be levied on 60% value. And liability to pay service tax will be service provider.
PJ/CASE LAW/2015-16/2946 Whether delayed payment of duty, but before issuance of SCN, attracts penalty? with respect to this does it means we have to pay penalty ?? Because in the lsat it is written :- " Court was of the view that the approach made by the CESTAT with regard to penalty was totally erroneous. No matter whether the duty has been paid before issuance of SCN or not- delay in payment of duty attracts penalty and the same has to be paid." MEHUL SHAH (Posted On: 06 Feb, 2016)

The above referred case was related to the period from 1994 to 1996. In the present scenario, no penalty leviable if duty amount and interest is paid within 30 days of issuance of SCN and proceedings in respect of such duty amount and interest shall be deemed to have been concluded; But there should not be any wilful suppression or fraud in such cases. Further if the wilful suppression is not involved, reduced penalty equal to 15% of the duty amount alleged in the SCN shall be levied if duty, interest and reduced penalty is paid within 30 days of issuance of SCN. Further proceedings in respect of such duty amount, interest and penalty shall be deemed to be concluded; [Replied by CA Manish Vyas]
Can a Manufacturing unit, having central excise registration can do pure trading in the same gate... In case of doing will it attract excise.. visuiyer (Posted On: 04 Feb, 2016)

Yes manufacturing can be involved in pure trading of goods besides manufacturing the goods. Trading of goods will not attract excise duty. However, separate record of trading of goods should be maintained. The trading should be of different goods than manufacturing. If the same goods are traded which are also manufactured by the unit then the permission from the commissioner is required. [Replied by CA Manish Vyas]
Sir,by considering new excise Notification No. 01/2016 dtd.01.02.2016, can we avail credit on additional duty liveable under section 3 of the Customs Tariff Act, equivalent to the duty of excise specified under clauses (i), (ii), (iii), (iv), (v) (vi) and (via) of rule 3, in sub-rule (1) of CCR 2004? Yogesh Pawar (Posted On: 04 Feb, 2016)

Vide Notification 01/2016, the proviso to clause (vii) of sub rule 1 of Rule 3 of Cenvat credit Rules, has been removed. This proviso was related to credit of additional duty on ships, boats and other floating structure for breaking up. Due to this proviso only 85% credit of additional duty was allowed on ships, boats and other floating structure. Now the proviso has been deleted therefore ship breaking company can take 100% credit of Additional Duty. However, the Rule 6 of Cenvat Credit will be applied if the ship breaking company sell some parts without using in manufacturing and in such case reversal of credit will be required. [Replied by Manish Vyas]
IF I AM GETTING 29000 ON 10 LACKS BILL ON RCM AND SUBCONTRACTOR CHARGE 52200 ON 9 LACKS ON SAME SUB CONTRACT SO I HAVE TO PAY ADDITIONAL 23000 FROM MY ACCOUNT?? WHAT CAN I DO mayank (Posted On: 02 Feb, 2016)

Your output tax liability is Rs. 29000 and your input tax is Rs 52200. You can take the credit of Rs. 52200 as input service. You can utilise this credit to pay your output tax liability of Rs. 29000. For the balance credit of Rs. 23200 (52200-29000) you can file the refund under Rule 5B of Cenvat Credit Rules, 2004. Refund of unutilized Cenvat credit taken on inputs and / or input services in respect of work contract service shall be claimed on a half yearly basis by following the procedure laid down in Rule 5B. Refund amount will be equivalent to “Unutilized Cenvat credit taken on inputs and input services during the half year for providing partial reverse charge services”
Respected Sir, We are private Limited company received bill for civil contract for Works contract under RCM. Party ( Partnership firm) charges service tax in bill @5.075% (including SBC). my query is if party collects service tax from us then we also paid service tax to govt. under RCM or not. Regards, Deepak Dalvi Deepak Dalvi (Posted On: 02 Feb, 2016)

The party has collected his part of 5.075% and not paid the amount of company. Company should calculate his part and pay the same in his (company) registration number. [Replied by Manish Vyas]
An importer has taken excise registration to pass CVD. Whether he can pass credit to job worker? Job worker is registered and paying excise. Darshan Machchhar (Posted On: 26 Jan, 2016)

Yes, the importer can pass on the Cenvat of the CVD to the job worker. The job worker can utilize such Cenvat if the said goods are used in the goods manufactured by him. The required proviso to be complied with is the proviso to rule 11 which states as follows: “Provided further that if goods are directly sent to a job worker on the direction of a manufacturer or the provider of output service, the invoice shall also contain the details of the manufacturer or the provider of output service, as the case may be, as buyer and contain the details of job worker as the consignee:” (query replied by CA Vaibhav Bothra)
I have taken marketing rights of a appliance company .I am procuring material on their behalf. I want to add products to their product line.Even if i trade some products and repack and resell under their name am i or the company liable to pay excise duty.Earlier company is procuring all the goods from Excise free Zones. Ganesh (Posted On: 26 Jan, 2016)

Based on information provided in the query, we can say that If the repacking of your product is amount to manufacture then you will be liable to pay excise duty otherwise not. If you provide us the tariff heading of your product then we can reply the same. [Query Replied by CA Manish Vyas]
Dear Sir/Mam, Good afternoon, We are into job work for tata steel. We do cut to length, pickling of coil for tata steel and charge service on process charge. My quiers is whether we can take excise duty credit on consumable input used for provide service against our output service tax liabilty. ANKUR AGARWAL (Posted On: 25 Jan, 2016)

As per Rule 2(k) Input includes "all goods used for providing output service" therefore the Cenvat Credit can be taken on consumables used for providing taxable services. But LDO, HSD and petrol not eligible [Query Replied by CA Manish Vyas]
Sir,We fail to file excise return ( Feb-2014) before due date.Filled on 11th March 2014.Now Dept asking for pay Rs.5000/- penalty.But as per my view, i have to pay only Rs.100/- as a penalty for filling return 1 day late (Refer Notification No. 8/2015–Central Excise (N.T.)dtd.01.03.2015- Amendment in Rule 12(6) & Rule 17(6) of Central Excise Rules, 2002).Please give your view as i need to pay 100 rupees of 5000 rupees as a penalty? Yogesh Pawar (Posted On: 24 Jan, 2016)

Please note that rule 12(6) of CER, 2002 is applicable for ER-4 return (Annual Financial Information Statement) and rule 17(6) is applicable for ER-2 (return for EOU). The penalty for non filing of ER-1 shall be governed by rule 27 of such rules wherein a maximum penalty of 5000/- is prescribed. (query replied by CA Vaibhav Bothra)
dear sir, i am getting service tax under works contract as per reverse charge mechanismi.e 50% now how much service charge i have to pay to my sub contractor under this mechanism. if after filing quaterly return,if my subcontractor raised bill in next quater,how can i claim credit of service charge regards, mayank dave mayank dave (Posted On: 21 Jan, 2016)

It can be assumed from your query that you are an entity other than a body corporate. For the transactions with the sub-contractor, no reverse charge shall be applicable as the service receiver i.e. you are not a body corporate. Thus you have to pay the service tax charged by your sub-contractor full to him only. You said that you are filing quarterly return, whereas in service tax, only half yearly returns are to be filed. There is no provision of filing of returns quarterly. Only service tax is to be deposited quarterly. As regards the Cenvat is concerned, it can be availed up to 1 year from the date of invoice. Thus you are eligible to avail the Cenvat in next quarter also. (query replied by CA Vaibhav Bothra)
Sir, my company has paid legal fees and other travel & accomodation payments to lawyer. Where reimbursement of expense is done on actaul basis only. Whether under RCM company has to pay Service Tax on total amount including reimbursement or on legal fees only? Bhagyashree Bhatt (Posted On: 17 Jan, 2016)

There was decision of Delhi High Court in the case of Intercontinental Technocrafts Ltd. that wherein Rule 5(1)of the Service Tax (Determination of Value Rules, 2006) was quashed as ultra vires the section 67 of the Finance Act. Rule 5(1) states that all expenditure or costs incurred by the service provider during the course of providing service are included in the consideration of taxable service. However, w.e.f., 14.05.2015, definition of consideration given in the section 67 has been amended to include any reimbursable expenditure or cost incurred by the service provider and charged during the course of providing a service. Consequently, reimbursements are considered as part of consideration for taxable service. Therefore, service tax is payable on reimbursable expenditures recovered on actual basis also. {Query replied by: CA Neetu Sukhwani}
is registration for selling sim card is required in jvat Ali (Posted On: 09 Jan, 2016)

We do not deal in VAT Laws. Please ask queries relating to Central Excise, Service Tax, Customs and DGFT laws only. {Query replied by: CA Neetu Sukhwani}
Dear Sir, As discussed with Mr . Suhail regarding query in Service Tax matter please find the facts of query as under: Fact of the case: 1.Mr. Shubh Agarwal(located in Non SEZ Tarritory) is providing IT Consultancy Service to Third Party (Also in Non SEZ Tarritory) .Actually Mr. Agrawal is providing service to a Unit Located in SEZ Tarritory through third Party. 2.Mr. Agarwal raising Bill to third Party for Agreed amount without including service tax and had Deposited service Tax for First Quarter by making reverse calculation on bills raised to third party. 3.Third Party obviously not Collecting service tax while raising bill to unit located in SEZ area. Clarification Required:- 1.Mr. Agarwal wants to know whether he is liable for service tax for further service provided in second quarter onwards. 2.If Mr. Agarwal is not liable for service tax then whether he can collect the amount paid in first quarter from Service Tax Department . In case of any further information required please do mention me. akash gupta (Posted On: 07 Jan, 2016)

In our opinion, Mr. Agarwal is liable to pay service tax on the services provided to third party irrespective of the fact that the third party provides services to SEZ for its authorised operations. Exemption is available to service providers directly providing services to SEZ and there is no exemption for sub-contractor. The relevant provision for studying the procedure for claiming exemption for services provided to SEZ unit is contained in notification no. 12/2013-ST dated 01.07.2013. {Query replied by CA Neetu Sukhwani}
Dear Sir, As discussed with Mr . Suhail regarding query in Service Tax matter please find the facts of query as under: Fact of the case: 1.Mr. Shubh Agarwal(located in Non SEZ Tarritory) is providing IT Consultancy Service to Third Party (Also in Non SEZ Tarritory) .Actually Mr. Agrawal is providing service to a Unit Located in SEZ Tarritory through third Party. 2.Mr. Agarwal raising Bill to third Party for Agreed amount without including service tax and had Deposited service Tax for First Quarter by making reverse calculation on bills raised to third party. 3.Third Party obviously not Collecting service tax while raising bill to unit located in SEZ area. Clarification Required:- 1.Mr. Agarwal wants to know whether he is liable for service tax for further service provided in second quarter onwards. 2.If Mr. Agarwal is not liable for service tax then whether he can collect the amount paid in first quarter from Service Tax Department . In case of any further information required please do mention me. AKASH GUPTA (Posted On: 07 Jan, 2016)

In our opinion, Mr. Agarwal is liable to pay service tax on the services provided to third party irrespective of the fact that the third party provides services to SEZ for its authorised operations. Exemption is available to service providers directly providing services to SEZ and there is no exemption for sub-contractor. The relevant provision for studying the procedure for claiming exemption for services provided to SEZ unit is contained in notification no. 12/2013-ST dated 01.07.2013. {Query replied by CA Neetu Sukhwani}
Can Merchant exporter claim the refund of service tax of banking and financial services.? Paras Patel (Posted On: 06 Jan, 2016)

Yes, there is no restriction for claiming refund of service tax on the export of goods by merchant exporter under notification no. 41/2012-ST. {Query replied by CA Neetu Sukhwani}
Sir, Whether RCM is applicable to Limited Liability Partnership Nidhi (Posted On: 06 Jan, 2016)

The question regarding applicability of reverse charge mechanism on Limited Liability Partnership Firm is very tricky and is prone to litigation. This is for the reason that as per Companies Act, 2013, LLP is considered as Body Corporate whereas as per Partnership Act, LLP is treated as partnership firm. If we pursue Rule 2 (1)(cd), Partnership firm includes LLP. Consequently, if Service Tax Rules, 1994 are pursued, LLP is partnership firm and reverse charge mechanism should not apply on it. However, the revenue department may contend that as per Companies Act, 2013, LLP is body corporate so reverse charge mechanism would apply. This is a litigation prone issue. {Query replied by: CA Neetu Sukhwani}
A commercial training centre receives fees from its students and remits 20% thereof to the brand owner of the brand the centre uses. The Centre pays service tax on 80% of the fees so collected and the brand owner pays service tax on 20% of the fees so remitted to them by the Centre. Is this pro rata payment of service tax on shared consideration (fees) legal and proper...? dilip kumar verma (Posted On: 05 Jan, 2016)

No, the above arrangement of pro rata payment of service tax is not legal and is not proper. As per law, the commercial training centre receives entire fees from students and so is liable to pay service tax on the entire fees received by it. The brand owner is allowing the commercial training centre to use its brand name and in consideration will raise bill for 20% and will pay the service tax applicable on it. The commercial training centre will get the cenvat credit of the service tax on 20% paid as it will be treated as its input services. {Query replied by CA Neetu Sukhwani}
Whether servcie tax would be applicable on tender fees. Nilesh Thakker (Posted On: 04 Jan, 2016)

Tender fees is similar to application fees and is not received for providing any service. Consequently, in our opinion, no service tax is payable on tender fees as the same is not received in lieu of providing any services. {Query replied by CA Neetu Sukhwani}
Dear Sir, I have a proprietorship concern in the name of my mother. On her demise the firm was transferred to my father by law of succession. We wanted to change the Service Tax reigistration in the name of my father but the service tax have refused to amend it stating ongoing litigation we are having with them. Presently the case is with Com. Appeals. Our clients are not accepting the ST Registrtion & our tenders are not approved. Kindly advice on the matter. AJAY TIWARI (Posted On: 01 Jan, 2016)

As stated in your query, service tax registration has been taken as proprietorship concern with PAN of your mother. Consequently, on the demise of your mother, the service tax registration cannot be continued and it is required to be surrendered. However, if the same concern is to be continued in the name of your father, you are required to obtain fresh service tax registration in the PAN of your father. Moreover, you may give a declaration/undertaking to the service tax department that "The new proprietorship concern in the name of ABC is taking over the business of XYZ and shall be liable for all the dues that may arise on account of decision of Commissioner Appeals in the pending case". In this regard, it is pertinent to have a look at the following decisions:- SHABINA ABRAHAM VS COLLECTOR OF CENTRAL EXCISE AND CUSTOMS [2015(322) E.L.T. 372 (S.C.)] COMMISSIONER OF C.EX., BANGALORE-III VS DHIREN GANDHI [2012 (281) E.L.T. 64 (KAR.)] In the above cases, it was held that legal heirs of deceased individual cannot be held liable for excise dues of the deceased unless and until the legal heir takes over the business of the deceased. {Query replied by: CA Neetu Sukhwani}
I want to know whether cenvat credit is eligible on GTA outward services. We are paying service tax on GTA outward under reverse charge method. We are selling parts to our dealers all over India from there they will sell it to the final customers. R.Pattabiraman (Posted On: 29 Dec, 2015)

Yes, the cenvat credit is eligbible on GTA outward services paid under reverse charge mechanism if the following conditions are being satisfied:- 1. Delivery of goods is on F.O.R. basis meaning that sale will conclude at the premises of buyer. 2. Risk of goods rests with the supplier of goods until they are accepted by the buyer of goods. 3. The amount of freight is included in the assessable value of goods for the purpose of discharging excise duty. If the above conditions are satisfied, the seller may take cenvat credit of service tax paid on the outward GTA services. {Query replied by: CA Neetu Sukhwani}
abc associates is a registered dealer under wb vat act as well as central excise act,purchased raw materials from X . X supplied the goods purchasing from Y. Y charged excise duty on the amount of sale price . X charged vat . x is not a registered dealer under excise act. will abc associates be able to take credit of excise duty which Y charged and vat which x charged? Anirban Majumder (Posted On: 28 Dec, 2015)

Please note that we do not deal in VAT laws. To the extent excise law is concerned, as X is not registered under the excise act, he will not be eligible to avail and pass on any Cenvat of excise duties. To pass on such duties, he needs to get registered under Excise. (query replied by CA Vaibhav Bothra)
we are mfg. unit purchase capital goods and take cenvat 50% first year and second year 50% credit and claim IT depreciation for example Capital Goods Rs. 1000/- basic cost + Rs. 120/- Total excise fist year we take cenvat credit in FY 1415 cap. credit 50% Rs. 60/- and next year FY 1516 50% Rs. 60/- claim and FY 14-15 IT depreciation claim on Rs. 1060/- audit Party said y have not claim both credit or depreciation allowed. my query which amount we have reverse we claim credit Rs. 60/-in FY 14-15 or deprecation value which is claim on IT charges Rs. 9/- (15% Dep.) on Rs. 60/- credit value and any interst + penlty charge payable yes or no if yes which amount on charges we have payable. Devang Shah Smith Life Scinces Pvt. Ltd. (Posted On: 26 Dec, 2015)

Audit party has raised correct objection that you cannot claim depreciation under IT and cenvat credit both simultaneously. If cenvat credit of Rs. 60/- is availed by you in the first year, and Rs. 60/- in the next year then, you can claim depreciation under IT only on Rs. 1000/-. Consequently, you are required to revise the IT return and claim reduced depreciation to the extent of Rs. 120/-. Alternatively, if you do not want to revise IT return, you should reverse entire cenvat credit claimed by you, i.e., Rs. 120/- along with interest. Moreover, as per amended penalty provisions, if you want to settle your case, you are also required to pay penalty equal to 15% of the duty liability. {Query replied by: CA Neetu Sukhwani}
I want to know whether cenvat credit is eligible on GTA inwared and outward services. We are paying service tax on GTA outward under reverse charge method. We are selling parts to the dealer and they will sell it to the final customers. R.Pattabiraman (Posted On: 24 Dec, 2015)

Yes, cenvat credit is admissible for GTA inward and outward services both. However, cenvat credit on GTA outward services is available only if 3 conditions are satisfied:- 1. There is FOR sales meaning that sale concludes at dealer's premises. 2. Risks of goods is with seller until goods reach dealer's premises. 3. Freight is included in the transaction value of goods and seller has paid excise duty on the freight amount. On satisfaction of above conditions, cenvat credit of service tax paid on outward freight may be availed. {Query replied by: CA Neetu Sukhwani}
Respected Sir, Can the CENVAT Credit on the Telephone & Mobile Phones used by Manufacturer Unit be availed? We are not the output service provider. Please provide the reason for it too. Thanks in Advance. Mit Shah (Posted On: 23 Dec, 2015)

Yes, the cenvat credit of service tax paid on Telephone and mobile phones can be availed provided the telephone services are used in relation to manufacturing activities and are not of personal nature. Also, if you are also dealing in exempted goods or exempted services, you are required to comply with the requirements of Rule 6 of the Cenvat Credit Rules, 2004. {Query replied by: CA Neetu Sukhwani}
What would be the valuation of services of supply of food & Beverages in the room of a hotel with declared tariff of Rs1000/- or more? Will the service tax charged on the 60% of total consideration of hotel room accommodation plus the price of food and beverages...? dilip kumar verma (Posted On: 23 Dec, 2015)

If there is no package like accommodation with meal included in it and there is separate billing of room charges and restaurant charges, then the supply of food and beverages will be leviable to service tax at the rate of 40% under restaurant category only. However, if the meals are included as package, then, the service tax will be leviable at the rate of 60% because then it will be treated as bundled services. {Query replied by: CA Neetu Sukhwani}
Suppose We have purchase input on rate Rs.100/- & availed Excise credit Rs.12.50/-.Now same material we have removed as such to another company by charging rate Rs.105/- along with excise duty Rs.12.5/-(Equal duty). The difference in rate Rs.5/- is for overhead as transport. So can we do such type of transaction by considering excise law because excise dept asking as we are doing trading in this way & they are demanding to get register as trader. Is this correct? Yogesh Pawar (Posted On: 22 Dec, 2015)

If you are registered under Excise Laws as manufacturer and the material you are dealing in is input for you, then in that case, you may remove the material without taking dealer registration by applying the provisions of Rule 3(5) of the Cenvat Credit Rules, 2004 pertaining to clearance of inputs 'As such'. However, if the material is not input and you are regularly trading in that material then, in that case, for passing on cenvat credit, you are required to take registration as dealer for passing on the cenvat credit. {Query replied by: CA Neetu Sukhwani}
Suppose we have purchase input & at the time of receipt, we have paid GTA (Fright Inward) & availed service tax credit. But same material i have removed as such to another party.Now excise dept demanding to reverse service tax credit availed on fright inward belongs to same material. This is correct or not?also give if any notification, case study etc. available. Yogesh Pawar (Posted On: 22 Dec, 2015)

No, there is no provision in Cenvat Credit Rules, 2004 to reverse cenvat credit on input services used in procurement of inputs that are cleared 'As Such'. According to Rule 3(5) of the Cenvat Credit Rules, 2004, there is provision for reversing cenvat credit of duty paid with respect to inputs or capital goods. When there is no express provision for reversing cenvat credit of input services, the same cannot be demanded. This is also pronounced in the decision given in the case of DADU PIPES PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, NOIDA [2015 (39) S.T.R. 874 (Tri. - Del.)] {Query replied by: CA Neetu Sukhwani}
Respected Sir, I am a registered First/Second Stage dealer in excise and it is know that can Importer pass on the cvd to us. Please clarify can we pass on such duty to second stage dealer or manufacturer or can we claim refund the same from custom/excise. Whether the first stage dealer is entitled to pass on CVD or can he claim refund directly from customs or whether he is eligible for both type of claiming. Ajay Bansal (Posted On: 19 Dec, 2015)

Yes, importer can very well pass on the cenvat credit of CVD to the manufacturer/dealer. There is no mechanism to claim refund of CVD by the importer if he is not a manufacturer exporter because the refund of cenvat credit is available only to exporters. {Query replied by: CA Neetu Sukhwani}
Respected Sir/Madam , I want to know that TDS is applicable on commission payment to Foreign Commission agents (No P.A. in India) of Indian exporters Yes/no ? sudhakar jha (Posted On: 18 Dec, 2015)

We deal only in Central Excise, Service Tax, Customs and DGFT laws. We do not deal in Income Tax laws and provisions thereon. We can inform you regarding service tax implications of the transaction. The commission paid to foreign commission agent is not leviable to service tax. {Query replied by: CA Neetu Sukhwani}
Will maintenance contract signed before 15.11.2015 attract revised service tax? for e.g. a maintenance contract for one year is signed in April 2015 with payment term quarterly. Will the agency claim revised service tax for the bill for Oct.'15-Dec.'15 quarter? Vinod Guram (Posted On: 17 Dec, 2015)

To our understanding, your question is whether Swachh Bharat Cess is leviable for maintenance contract signed before 15.11.2015 or not. In this regard, we submit that although section 67A of the Finance Act, 1994 states that the rate of service tax applicable on the date of provision of service is applicable, the Point of Taxation Rules depict a different scenario. As per Rule 4 of Point of Taxation Rules, in case of change in rate of service tax, occurrence of any two events out of the three events determine the rate of service tax. The three events are provision of service, issue of invoice and receipt of payment. In the present case, as the payment will be received quarterly and service will be provided after 15.11.2015, two events , i.e., receipt of payment and provision of service occur after 15.11.2015 and so the Swachh Bharat Cess will be leviable on this maintenance contract. However, the FAQ released states that Rule 5 of Point of Taxation will apply which appears to be incorrect. In our opinion, Swachh Bharat Cess would be chargeable on this transaction. For more details, you may also study our article having link as follows :- http://www.new.capradeepjain.com/redirect_artleview_246 {Query replied by CA Neetu Sukhwani}
Our client is trader in foodgrain. For transportation purpose it has availed GTA facility. I want to know whether RCM is applicable on such freight expenses or may i take the benefit of entry no.26 of Mega exemption NN-25/2012 ILIAS PATHAN (Posted On: 14 Dec, 2015)

There is exemption to transportation of food grains in serial no. 21 of the Mega Exemption Notification no. 25/2012-ST dated 20.06.2012. It is submitted that when a service is not leviable to service tax due to exemption notification, the question of paying service tax under reverse charge mechanism does not arise at all. Hence, no service tax is payable on freight expenses for transportation of good grains under reverse charge mechanism. {Query replied by: CA Neetu Sukhwani}
We are manufacturers of automobile parts. In our premises we have installed RO water treatment plant for employees/canteen consumption. Also these water cans are being sent to HO/related TAFE office in city. Range Superintendent demands excise duty payale on water produced since commissioning. Are we lible to pay excise duty for water processed thru RO plant and distributed in bubble top cans. Kindly advise. Regards Srinivasan Srinivasan KK (Posted On: 14 Dec, 2015)

Mineral and other waters fall under chapter sub-heading no. 2201 of the Central Excise Tariff Act wherein the chapter note no. 5 states that process such as filteration and purification amounts to manufacture. However, there is one exemption notification no, 12/2012-CE dated 17.03.2012, entry no. 39 provides exemption to " Waters not cleared in sealed containers" falling under chapter heading 22019090. As per your query, it appears that the water cleared by you are not in sealed containers like that of Bisleri bottles. Accordingly, the benefit of exemption will be available if the water that is cleared falls under residuary chapter sub-heading meaning that no minerals are added and the containers are not sealed. {Query replied by: CA Neetu Sukhwani}
My question is on the liability to discharge the service tax on the freight charges paid under the Transportation of goods service. If both the consignor and the consignee is a proprietorship concern/ firm who will be liable? and why? Sandeep Shah (Posted On: 11 Dec, 2015)

If the person liable to pay freight is proprietorship concern, then liability to pay service tax will be on Goods Transport Agency and there will be no service tax liability under reverse charge mechanism. {Query replied by: CA Neetu Sukhwani}
Respected Sir, We run a school from a rented premises at Kolkata by paying a rent @ RS. 3.15 L pm. Ours is a trust and in the process of affiliation with CBSE. All our infra-structure costs are borne by a pvt. ltd. company , directors of which are the same as of trustee of the school trust. We are there from 2010. Kindly advise us whether the owner should charge us service tax on rental or not from this financial year. Subhasis Sen (Posted On: 08 Dec, 2015)

Yes, service tax is payable on renting service provided to a school because earlier the entry no. 9 of the Mega Exemption Notification no. 25/2012-ST provided exemption to services provided by way of renting of immovable property to a school. However, entry no. 9 was substituted vide Notification no. 06/2014-ST dated 11.07.2014 wherein only 4 types of services provided to educational institute are exempted, i.e., transportation, catering, security-housekeeping and admission related services. Hence, service tax on rent is payable in financial year 2015-16. {Query replied by CA Neetu Sukhwani}
Dear Sir / Madam, Iwould like to know that is Swachcha Bharat Cess refundable in case of export, as the provision of chappter V of the finance act is applicable on SBC that's why it should be refundable, let me know your opinion. Rgards CA. Mupur Agrawal CA Nupur Agrawal (Posted On: 07 Dec, 2015)

Although, Chapter V of the Finance Act is applicable on SBC but recently FAQ has been released which states that the cenvat credit of SBC will not be available. This clarification is going against the provisions of Chapter V but still to avoid litigation, assessees are not availing Cenvat Credit. Similarly, although when refund of service tax is granted to exporters, SBC on same footings should also be refunded but since there is no clear cut amendment in this regard and neither the service tax refund notification no. 41/2012-ST also does not contains any specific provision, it appears far possibility that the refund of SBC will be granted. However, claim may be made with the refund sanctioning authorities so that the claim does not turns time barred. {Query replied by: CA Neetu Sukhwani}
Is Entry Tax is applicable on CST purchase of Electrode & Mig wires from trader/dealer. K K Jena (Posted On: 28 Nov, 2015)

We do not deal in Sales Tax laws. Please ask queries relating to Excise , Customs, Service Tax and DGFT only. {Query replied by: CA Neetu Sukhwani}
sir I want to know about the case laws of TDS in construction contract e.g. any one partner of firm got tender on his personal name but he can deduct TDS his firm name Ankush Dhamorikar (Posted On: 25 Nov, 2015)

We do not deal in Income Tax Laws. Please ask queries relating to Excise, Customs, Service Tax or DGFT only. {Query replied by CA Neetu Sukhwani}
Hello Sir, One of my client is providing service from India to a Company based in United States. Nature of service is (Consultant shall be Global Open Text Architect and will be responsible for the architecture of Open Text implementations across all the Company’s operating companies) he received amount in dollors. Whether he is liable for service tax? Kamalesh Sanghani (Posted On: 23 Nov, 2015)

As per our understanding, the nature of services is consulting services provided online. It is submitted that the provision of consultancy through mails or through internet will not be covered by 'Online Information and Database Access or Retrieval Services'. As the nature of service is not covered specifically by any other Place of Provision of Service Rules, 2012, the case would be covered by general rule 3 according to which place of provision of service is the location of service receiver. As the service receiver is located in US, being non-taxable territory, the place of provision of service will be outside India. Moreover, the consideration is also received in convertible foreign currency. Therefore, it will amount to export of service as per Rule 6A of Service Tax Rules, 1994 and no service tax will be payable under reverse charge mechanism as no service tax is levied on export of service. {Query replied by: CA Neetu Sukhwani}
One of my client giving services from India to a company which locate in US as consultant (Marketing, Maintenance of website & operate) he receives amount in dollors. So now under export of services, whether he is liable for service tax? Awaiting your prompt reply. Kamalesh Sanghani (Posted On: 23 Nov, 2015)

As per our understanding, the nature of services is consulting services provided online. It is submitted that the provision of consultancy through mails or through internet will not be covered by 'Online Information and Database Access or Retrieval Services'. As the nature of service is not covered specifically by any other Place of Provision of Service Rules, 2012, the case would be covered by general rule 3 according to which place of provision of service is the location of service receiver. As the service receiver is located in US, being non-taxable territory, the place of provision of service will be outside India. Moreover, the consideration is also received in convertible foreign currency. Therefore, it will amount to export of service as per Rule 6A of Service Tax Rules, 1994 and no service tax will be payable under reverse charge mechanism as no service tax is levied on export of service. {Query replied by: CA Neetu Sukhwani}
Dear Sir, If Mfr unit temporarily stopped Production due to non availability of Orders since 1 year, we are having mfrd qty, selling these qty, meeting compliance of Excise & Service Tax, my doubt is We are rightly eligible to take Service Tax Input credit or not? pl clarify. Satya (Posted On: 23 Nov, 2015)

The issue as regards credit availment of input services during temporary suspension of production is a disputed matter and the credit should be availed only if the amount is substantial. This is for the reason that the defination of input service says that input service means any service used by manufacturer directly or indirectly in or in relation to the manufacture of final products and clearance of final products upto the place of removal. As there is no manufacture but still there is clearance of final products already manufactured by you. Therefore, the issue is litigation prone and should be decided on monetary basis. {Query replied by: CA Neetu Sukhwani}
Sir, I just wantto know that the Universities charging Affiliation Fees from Private/Self Financed Colleges then whether the university will be liable to pay Service Tax on Affiliation Fees as the services is not to Student, Faculty or Staff. ANIL (Posted On: 13 Nov, 2015)

This is with reference to your query as regards service tax applicability on affiliation fees paid by Private Colleges to the Universities. In this regard, we hereby intimate that prior to 01.07.2012, there was no service tax on any kind of educational services. However, with the advent of negative list tax regime with effect from 01.07.2012, except exemptions given in negative list and mega exemption notification, all services were taxable. As regards service tax on affliation fees paid to private colleges to Universities is concerned, there is no clear cut exemption for the same. However, as per the latest entry no. 9 of the Mega Exemption Notification, services provided by an educational institution to its students, faculty and staff are exempted. Furthermore, services provided to an educational institution by way of transportation of students, catering, security, cleaning, housekeeping services and SERVICES RELATING TO ADMISSION TO OR CONDUCT OF EXAMINATION BY SUCH INSTITUTION are exempted. In our opinion, it may be contended that the affiliation fees paid by Private Colleges to the Universities are related to admission or conduct of examination by such institution but this contention is very remote. However, the service tax department will surely object this and will demand service tax. Accordingly, to be on safer side, we suggest that service tax should be paid on the affiliation fees so that interest and penal consequences are avoided. {Query replied by: CA Neetu Sukhwani}
Kindly explain the Swachh Bharat Cess, Effective November 15, 2015. Queries: 1.Is it payable on reverse charge payable? 2.Is it abated value or taxable value for GTA? 3.Shown separately in invoice? 4.Is it applicable for manufacturer? 5.Can we avail credit of SBC paid? 6.Is it addl cost to the company? regards Subramani.P Subramani.P (Posted On: 09 Nov, 2015)

The provisions of reverse charge mechanism and abatement are applicable for computing Swachh Bharat Cess also. Yes, Swachh Bharat Cess is required to be separately shown in the invoice. No, Swachh Bharat Cess is applicable only on taxable services provided by the service provider and is not applicable to a manufacturer. The cenvat credit of Swachh Bharat Cess cannot be availed as per FAQ released. Yes, Swachh Bharat Cess will be additional cost to the company. {Query replied by: CA Neetu Sukhwani}
SIR WE ARE A MANUFACTURE AND ENJOYING SSI EXEMPTION AND PAYING SERVICE TAX ON GTA FOR FREIGHT INWARD , SIR WE WISH TO KNOW THAT CAN WE TAKE CENVET CREDIT ON SERVICE TAX PAID BEFORE THE CROSSING THE SSI EXEMPTION PRAKASH RENIWAL (Posted On: 30 Oct, 2015)

Before crossing SSI exemption, i.e., when no excise duty is being paid, the assessee cannot avail cenvat credit of inputs or input services availed by them. Accordingly, you cannot avail the cenvat credit of service tax paid on freight inward during the period of SSI exemption. {Query replied by: CA Neetu Sukhwani}
sirji suppose A ltd a manufacturer sell goods to a trader who again sell goods to another manufacturer b Ltd, A ltd issue gate pass in the name of B ltd but invoice in the name of trader so can b ltd claim exice duty CA RAHUL JAIN (Posted On: 27 Oct, 2015)

B ltd. can claim cenvat credit of excise duty paid if the trader is a registered dealer in Central Excise and issues cenvatable invoice to B Ltd. If trader is not registered dealer in Excise, A Ltd should mention the name of B Ltd as consignee and trader as buyer in the invoice. If such an arrangement is made, B Ltd. can take cenvat credit on the strength of invoice issued by A ltd. However, if the name of B Ltd. is not mentioned as consignee in the invoice issued by A ltd., then in that case, B Ltd. cannot take the cenvat credit. {Query replied by: CA Neetu Sukhwani}
If the export is under LUT , Wheather duty amount is to be mentioned in the ARE1 Nimish Karwa (Posted On: 24 Oct, 2015)

Yes, even if the export is under LUT, the duty amount is required to be mentioned in the ARE-1. {Query replied by CA Neetu Sukhwani}
If the export is under LUT , Wheather duty amount is to be mentioned in the ARE1 Nimish Karwa (Posted On: 24 Oct, 2015)

Yes, even if the export is under LUT, the duty amount is required to be mentioned in the ARE-1. {Query replied by CA Neetu Sukhwani}
Dear Experts, CENVAT Rules Says, education cess can be utilized for the payment of education cess. My Question is, if a person is having Cenvat credit of Education Cess and Higher Cess, Can it be utilized against this 14% service Tax liablity. only. As per New Rates, Service tax is being levied @14% flat from 01.06.2015 Please answer deepak goyal (Posted On: 17 Oct, 2015)

There is no clarification till date for utilisation of Education Cess and SHE Cess balance available on 30.05.2015 with the service provider. However, as per notification no. 22/2015-CE (NT) dated 29.10.2015, service provider may utilise education cess and SHE cess on inputs/capital goods received in the premises on or after 01.06.2015 for discharging service tax liability. However, the main point is that only the education cess and SHE cess pertaining to inputs/capital goods received on or after 01.06.2015 can be used for paying service tax. {Query replied by: CA Neetu Sukhwani}
SUPPLIER OF MATERIAL IS CHARGING FREIGHT AS STATED IN THE P.O. AGAINST EX WORKS SUPPLY. HE IS ALSO CHARGING SERVICE TAX THEREON IN THE INVOICE. WHO IS ELIGIBLE TO PAY & / OR TAKE SERVICE TAX CREDIT AGAINST THIS. SHAMBHU KUMAR SHARMA (Posted On: 16 Oct, 2015)

As per the provisions of Finance Act, 1994 in case of transport of goods by road, the person liable to pay freight, if falls under the specified categories is liable to pay service tax to the government. The specified categories are registered factory, registered society, co-operative society, registered excise dealer, body corporate or partnership firm. The supplier is charging ex factory price thereby meaning that sale takes place at the factory gate itself. Therefore,it means that the transportation of goods is your responsibility and you are to incur freight expenses. If you also fall under specified categories, then the liability to pay service tax arises on you under reverse charge mechanism. In that case, you may take cenvat credit on the basis of challan. {Query replied by: CA Neetu Sukhwani}
ST3 FOR THE PERIOD 2009-10 FILED ON 31.10.2011..WHETHR EXTEDED PERIOD OF LIMITATION APPLICABLE AND SHOW CAUSE CAN BE ISSUED AFTER 30.09.2015 IN VIEW OF SECTION 73(6)ia vedraj agarwal (Posted On: 09 Oct, 2015)

The last date for filing ST-3 return for the period from April, 2009 to September, 2009 was 25.10.2009. As per section 73(6)(i), relevant date in the case of taxable service in respect of which service tax has not been levied or paid or has been short levied or short paid – (a) Where under the rules made under this Chapter, a periodical return, showing particulars of service tax paid during the period to which the said return relates is to be filed by an assessee, the date on which such return is so filed; (b) Where no periodical return as aforesaid is filed, the last date on which such return is to be filed under the said rules; On analysing the above provision, if service tax return is filed, the date of filing ST-3 return will be the relevant date otherwise the last date on which such return is to be filed will be the relevant date. In the present case, as the return is filed on 31.10.2011, the time limit of 5 years will be computed from 31.10.2011. Accordingly, if the extended period of limitation is invoked, the show cause notice can be issued upto 30.10.2016. The fact whether extended period of limitation can be invoked or not will depend on whether there is malafide intention or mens rea. {Query replied by CA Neetu Sukhwani}
one time deposit collected from flat holders by builder later on whole fund tranfeered to society. what is service tax inpact on society for the accumulated fund of flat owner received from builder.. vedraj agarwal (Posted On: 09 Oct, 2015)

This issue is a controversial one and service tax department has also raised service tax demands on the amount collected and transferred to society. However, in case of our clients, the service tax demand has been dropped by the adjudicating authority as the amount collected as deposit cannot be considered as consideration for any service because the same is reflected in the liability side of the balance sheet. We have contended that as the amount collected as deposit has a balance and is shown in the balance sheet, the same cannot be considered as income/consideration for providing any services. {Query replied by CA Neetu Sukhwani}
whether 15% penalty u/s 78. says it is inclusive of penalty for late filing of st3 (service tax retuns) also.as in the section it is written that after paying 15%penalty there be closure of all proceedings and no show couse notice to be issued. vedraj agarwal (Posted On: 09 Oct, 2015)

No, penalty for late filing of ST-3 returns is imposed under section 70 of the Finance Act, 1994 and is not covered under section 78. The section 78 is for penalty for non-payment/short payment of service tax due to fraud, collusion, wilful misstatement of facts or contravention of provisions with intend to evade payment of duty. The provision of conclusion of proceedings under section 78 is for penalty imposed under section 78 only and not for penalty imposed under any other section. {Query replied by CA Neetu Sukhwani}
sir ji.. can we take cenvat credit for the service tax paid as receipient of service (for import of service) visuiyer (Posted On: 05 Oct, 2015)

Yes, you can take cenvat credit of service tax paid as recipient of service under reverse charge mechanism on the basis of challan through which service tax was paid by you. However, the eligibility to avail cenvat credit will be governed by the Cenvat Credit Rules, 2004 and if there are any restrictions regarding availment of credit for particular service, then the same would apply. For example, cenvat credit of works contract services, rent a cab services is not available. {Query replied by CA Neetu Sukhwani}
Respected Sir, Plz sent your valuable weekly news letter in the given email-capraveenbansal@gmail.com previous we get on capraveenbansal@in.com has services has been closed by in.com CA PRAVEEN BANSAL MATHURA (Posted On: 04 Oct, 2015)

In order to receive our weekly newsletter, you are requested to create another login id on our website using capraveenbansal@gmail.com. The procedure for login is very easy and is free of cost. {Query replied by CA Neetu Sukhwani}
Respected Sir, If we are providing services & registered under Service Tax but not registered under excise. if we import some material used in while rendering services, then can we take credit of both CVD & Add Duty under service tax. Regards, Deepak Dalvi Deepak Dalvi (Posted On: 03 Oct, 2015)

Yes, the cenvat credit of CVD and SAD on imported materials can be availed and used for discharging service tax liability on provision of output service because there is no one to one correlation of utilisation of cenvat credit. The cenvat credit pertaining to excise duty may be used for paying service tax on output service. {Query replied by CA Neetu Sukhwani}
Respected Sir, If received service from outside india for that i have to pay commission, who is outside india. a. Is this comes under RCM under Service Tax. b. If Comes then on what amt to calculate service tax at what rate.(he is charging comission in foreign currency,then where to get exchange rate for convert it into indian rupees) Regards, Deepak Dalvi Deepak Dalvi (Posted On: 03 Oct, 2015)

The service tax liability on commission paid to foreign service provider is governed by provision of Rule 9 of the Place of Provision of Service Rules, 2012 wherein the place of provision of service is the location of the service provider. In the present case, the location of the service provider is outside India, therefore, the service is considered to be provided outside India. As the service is provided in non-taxable territory, the question of paying service tax does not arise. We further inform you that although no service tax is payable in this case, there is no requirement to convert the amount of commission charged into Indian Rupees. However, if at all conversion is required to be done, it is to be done at rate prescribed by the Central Government from time to time by way of issuance of Non-Tariff Notifications in Customs. {Query replied by CA Neetu Sukhwani}
Dear Editor and team members, The query relates to service tax applicability for builders cum developer for constructing villas. The developer enters into JDA with the owner of the property and he develops the the area and divided the same to 44 sites and agrees to construct 20 houses for the owner and balance for the individual buyers. The individual buyer registers the land in his name and gets approval for construction in the individual buyer's name. Now developer builder is constructing individual villas for single occupancy (one kitchen). He fixes Rs.75 lacs for construction cost including developing charges. Now what is the service tax liability for the builder for 25 independent villas and for construction of 19 villas for the owner in consideration. Kindly clarify. rengaraj (Posted On: 30 Sep, 2015)

In order to be able to answer the question as regards service tax leviability for the construction of 25 independent villas, we need to study in detail. This is for the reason that it is not clear whether the developer develops 25 individual villas according to individual requirements or constructs it as a residential complex with symmetry in design. If the 25 villas are constructed according to individual requirements then no service tax is payable but it the 25 villas are constructed as a residential complex then service tax will be payable. According to the facts, as development cost is included in the construction cost, it appears that it is construction of residential complex. Hence, service tax leviability on 25 villas needs to be examined. Further, with respect to construction of 20 villas for the owner, there are views that service tax is leviable as it is sort of barter system wherein owner provides land to builder and builder constructs villas in consideration. Moreover, there is ambiguity as regards valuation. No doubt, service tax is payable but the value to be taken is not clear. However, the valuation may be done as per clarification given in 2.1 (B) of the Circular no. 151/2/2012-ST dated 10.02.2012. {Query replied by: CA Neetu Sukhwani}
As per Circular No 98/01/2008-ST dated 04/01/2008,Can we avail service tax credit on bill received for renting of Immovable property? Circular say that “Input credit of service tax can be taken only if the output is a ‘service’ liable to service tax or a ‘goods’ liable to excise duty. Since immovable property is neither ‘service’ or ‘goods’ as referred to above, input credit cannot be taken”.Renting of Immovable property comes under Input service or not? Yogesh Pawar Yogesh Pawar (Posted On: 26 Sep, 2015)

You are intimated that you can take the cenvat credit of service tax paid on bill received for renting of immovable property. This is for the reason that renting of immovable property is covered under input service as far as the same is used for providing taxable output service or in manufacture of dutiable goods. The circular quoted by you states that no cenvat credit can be taken of construction services availed for construction of immovable property. This circular does not states that credit of renting of immovable property service cannot be taken at all. {Query replied by: CA Neetu Sukhwani}
Is it necessary to get service tax registration as soon as land given on rent under renting of immovable property? Already service tax reg is available for GTA,Security service,Manpower etc.We have to stay till renting billing will touch 10 lakh or not? Value base exemption(10 lakh) will be allowed or not? Yogesh Pawar (Posted On: 26 Sep, 2015)

Firstly, we assume that you pay service tax under GTA, security service and Manpower under reverse charge mechanism. In such a case, you are hereby intimated that when service tax is paid under reverse charge mechanism, the value of services for which service tax is paid in the capacity of service recipient is not included while computing the threshold limit of Rs. 10 Lacs. Consequently, service tax is payable under renting of immovable property service only if the receipts are more than Rs. 10 Lacs. Furthermore, although there is no compulsion to get registration until there is service tax liability, you may amend the service tax registration by including renting of immovable property service also. {Query replied by: CA Neetu Sukhwani}
Sir,Suppose X company has given some space to Y company on rent basis(renting of immovable property) & Y company is Job worker for X.Then can Y company will avail service tax credit on bill received for renting of Immovable property?Can we treat as Input service for Y company? Yogesh Pawar (Posted On: 26 Sep, 2015)

No, company Y cannot take cenvat credit on bill received for renting of immovable property from X if company Y is doing 100% job work for X. This is for the reason that the “process amounting to manufacture of goods on which excise duty is paid” is covered by clause (f) of the negative list and is treated as exempted service. Accordingly, if company Y is doing 100% job work for company Y, it cannot avail cenvat credit of service tax paid on rent. To avail the credit, input service should be used in providing dutiable goods or taxable services. However, if company Y is also manufacturing and clearing similar goods on payment of excise duty, then credit may be availed following the provisions of Rule 6 of the Cenvat Credit Rules, 2004. {Query replied by: CA Neetu Sukhwani}
Sir, we are going to shift one company to our premises i.e giving space in our factory for production purpose then can we do it by considering excise point of view? If yes then what is the procedure? Is it necessary to allocate separate layout for both organisation by making proper boundary of wall? Also please suggest documentary procedure also if any by considering excise?Yogesh Pawar Yogesh Pawar (Posted On: 26 Sep, 2015)

Yes, a part of the registered factory premises may be given on rent to another manufacturer and for this, the premises renting out space is required to amend its Central Excise Registration. The lending premises is required give a revised map of its factory indicating the area of factory premises used for manufacturing activities by the premises renting the portion to another. The entry and exit of the space rented should be separately demarcated. Both the premises should have separate entry and exit. The procedure for amendment in excise registration is required to be followed. {Query replied by: CA Neetu Sukhwani}
Respected Sir/Madam, If Service Provider is Individual but not registered with Service Tax Dept. or Availing SSI Exemption limit then under RCM service receiver(company) has to pay his service tax part to Dept or not. Regards, Deepak Dalvi. Deepak Dalvi (Posted On: 25 Sep, 2015)

Yes, the receiver company, if liable to pay service tax under reverse charge mechanism is required to pay the service tax even if the service provider is individual falling below the threshold exemption because under reverse charge mechanism, service tax is required to be paid for each and every amount irrespective of the small scale exemption. This restriction is mentioned in the proviso (ii) to the small scale exemption notification no. 33/2012-ST dated 20.06.2012. {Query replied by: CA Neetu Sukhwani}
Respected Sir, If Party charges ST @4.9% Under Works Contract in his invoice then, a.we also make payment of ST @4.9% to govt.then take credit. or b. if we paid to party as he charges in his invoice then take credit.but how to show in the ST Return.please mention notification No. Regards, Deepak Dalvi Deepak Dalvi (Posted On: 23 Sep, 2015)

Your query is not clear but as per my understanding, the works contract is of Repair or maintenance. If the works contract service is provided by individual, HUF, partnership firm etc and the service receiver is business entity registered as body corporate, then 50% service tax is payable by service provider and 50% service tax is payable by the service receiver. The cenvat credit of 50% service tax paid by the service provider will be allowed on the basis of invoice issued by service provider and on the condition that payment is made to the service provider of the invoice value along with service tax within 3 months from the date of issue of invoice. The cenvat credit of 50% service tax paid by service receiver will be available on the basis of challan. The credit will be allowed subject to fulfillment of other terms and conditions of Cenvat credit scheme. In service tax return, service receiver is required to reflect the 50% service tax paid by him by choosing the option of notification no. 30/2012-ST dated 20.06.2012. {Query replied by: CA Neetu Sukhwani}
Respected Sir, I have Received invoice for civil work under works contract, in that service provider charge us service tax [(70% of value without including VAT)X 14% X 50%]. My query is if he collects ST from us then again we want to make payment of ST @4.9% under RCM to Govt. Regards, Deepak Dalvi Deepak Dalvi (Posted On: 23 Sep, 2015)

Yes, as communicated earlier also, in case of works contract, if service is provided by individual, HUF, partnership firm etc and the service receiver is business entity registered as body corporate, then 50% service tax is payable by service provider and 50% service tax is payable by the service receiver. As service provider has charged only 50% service tax, the balance 50% of service tax is liable to be discharged by the service recipient. {Query replied by: CA Neetu Sukhwani}
Dear sir, We are manufacture tractors parts and my query is we are using hydraulic oil/Gear oil/Coolants for Makino machines to produce final product of tractor parts. Shall we avail cenvat credit on using hydraulic oil/Gear oil/Coolants. Pls clarify. Regards Subramani.P Subramani.P (Posted On: 22 Sep, 2015)

The use of hydraulic oil/gear oil/coolants etc. is similar to welding electrodes used in maintenance of plant and machinery. There is dispute in credit availment of these items because these are primarily used in relation to machineries which are capital goods and as per defination of capital goods given under Rule 2(a) of the Cenvat Credit Rules, 2004 only items of specified tariff headings and spares, accessories, parts of capital goods are eligible for credit as capital goods. Accordingly, the credit of these items is not available as capital goods credit. Simultaneously, these cannot be treated as inputs used for manufacture of final product. However, there are certain decisions recently reported wherein the cenvat credit of welding electrodes used in case of plant and machinery have been allowed. Similarly, the credit on these items may be admissible but it is litigation prone. {Query replied by: CA Neetu Sukhwani}
Sir, As an event manager we are booking hotel rooms etc.on behalf of our clients and pay directly to the hotels inclusive of 8.4% tax on same for our clients. Now please confirm how we shall take the said money on actual from our clients as reimbursement as per new rule post budget 2015. Pratap Seth (Posted On: 22 Sep, 2015)

In the Budget, 2015, section 67 of the Finance Act was amended to add explanation wherein consideration includes any reimbursable expenditure or cost incurred by the service provider and charged in the course of providing or agreeing to provide a taxable service, except in such circumstances and subject to such conditions as may be prescribed. Till now, no exceptions have been prescribed and so the booking of hotels and reimbursement on actual basis will be included in the taxable value of service of event management provided. The amendment made by the budget nullifies the Delhi High Court decision in the case of Intercontinental Consultants and Technocrafts Pvt. Ltd. Vs Union of India reported in 2012-TIOL-966-HC-DEL-ST. {Query replied by: CA Neetu Sukhwani}
Can you provide some case laws in which the assessee delayed the submission of EXP-2 however the show cause notice on it was dropped on account of procedural lapse ? Shirish Shah (Posted On: 19 Sep, 2015)

Yes, delay in submission of EXP-2/EXP-4 cannot lead to denial of the benefit of the exemption contained in the notification. We have some order in originals in our favour on the issue of late filing of EXP-4 by the adjudicating authorities in Jodhpur Commissionerate. The issue was decided in the case of Adarsh Guar Gum Udyog vide Order in Original No. 10/ST/2012 dated 28.06.2012 wherein it was concluded that the delay in filing EXP-2 return cannot be held as substantial ground for denial of the benefit of the exemption notification and so the service tax demand was quashed. Similar decision was given in the case of Rajasthan Gum Pvt. Ltd. vide Order in Original no. 34/2014-(ST) dated 26.11.2014. You may refer these in the case studies section of our website. {Query replied by: CA Neetu Sukhwani}
Respected sir, a. how to know which services received comes under works contract. b. rate of service tax c. how to calculate service tax in different conditions. please explain in simple regards, Deepak Dalvi Deepak Dalvi (Posted On: 16 Sep, 2015)

The main feature of works contract service is provision of service along with sale of material during the course of provision of service. There are three categories of works contract services:- 1. Original works 2. Repair or reconditioning or servicing of any goods 3. Maintenance or repair or reconditioning of any immovable property and completion and finishing services such as glazing, plastering, floor and wall tiling, installation of electrical fittings of immovable property etc. The valuation of works contract is governed by Rule 2A of the Service Tax (Determination of Value)Rules, 2006 according to which if the value of material used can be bifurcated, service tax is required to be paid on the service portion at the rate of 14%. However, if it is not possible to bifurcate the value of material portion, then, service tax is to be paid on 40% of the value for original works and 70% of the value of repair and maintenance contracts (both for goods and immovable property). Earlier, before 01.10.2014, for maintenance or completion and finishing of immovable property, service tax was required to be paid on 60% of the value for such works contract. {Query replied by: CA Neetu Sukhwani}
Respected sir, we are private limited co. making payment against commission to service provider who is outside india against services rendered outside india. my query is we are liabe to pay service tax under RCM.if applicable then on what percentage we want to pay service tax. Regards, Deepak Dalvi Deepak Dalvi (Posted On: 16 Sep, 2015)

No, there is no requirement of payment of service tax for commission paid to commission agent located outside India under reverse charge mechanism because the place of provision of service as per the Place of Provision of Service Rules, 2012 arrives at ‘non taxable territory’. As per Rule 9 of the Place of Provision of Service Rules, 2012, in case of intermediary, the place of provision of service is the location of service provider. As in the present case, service provider is located outside India, the service is deemed to have been provided outside India and so no service tax is leviable on the transaction. When service tax itself is not leviable, the question of reverse charge mechanism does not arise. {Query replied by: CA Neetu Sukhwani}
Dear Sir, We are into Interiors, We had received different PO from our Client for Material Supply & Installation. Now Supply comes under VAT/CST Component & Installation comes under Service Tax Component. Now My query is are we have to pay service tax for supply of material as Vat & service tax as 50% 50%. kindly reply the query as the earliest. Thnkyou, Regard's Saaraah. Saaraah (Posted On: 15 Sep, 2015)

Firstly, you are required to ascertain whether the service provided by you falls under errection, commissioning and installation service or works contract service. The main feature of works contract service is provision of service along with sale of material during the course of provision of service. There are three categories of works contract services:- 1. Original works 2. Repair or reconditioning or servicing of any goods 3. Maintenance or repair or reconditioning of any immovable property and completion and finishing services such as glazing, plastering, floor and wall tiling, installation of electrical fittings of immovable property etc. The valuation of works contract is governed by Rule 2A of the Service Tax (Determination of Value)Rules, 2006 according to which if the value of material used can be bifurcated, service tax is required to be paid on the service portion at the rate of 14%. However, if it is not possible to bifurcate the value of material portion, then, service tax is to be paid on 40% of the value for original works and 70% of the value of repair and maintenance contracts (both for goods and immovable property). Earlier, before 01.10.2014, for maintenance or completion and finishing of immovable property, service tax was required to be paid on 60% of the value for such works contract. However, if your service is errection, commissioning and installation service, then service tax may be paid at the rate of 14% on the installation services excluding the value of materials on which vat is paid. {Query replied by: CA Neetu Sukhwani}
Dear Sir, We are into Interiors, We had received different PO from our Client for Material Supply & Installation. Now Supply comes under VAT/CST Component & Installation comes under Service Tax Component. Now My query is are we have to pay service tax for supply of material as Vat & service tax as 50% 50%. kindly reply the query as the earliest. Thnkyou, Regard's Saaraah. Saaraah (Posted On: 15 Sep, 2015)

Firstly, you are required to ascertain whether the service provided by you falls under errection, commissioning and installation service or works contract service. The main feature of works contract service is provision of service along with sale of material during the course of provision of service. There are three categories of works contract services:- 1. Original works 2. Repair or reconditioning or servicing of any goods 3. Maintenance or repair or reconditioning of any immovable property and completion and finishing services such as glazing, plastering, floor and wall tiling, installation of electrical fittings of immovable property etc. The valuation of works contract is governed by Rule 2A of the Service Tax (Determination of Value)Rules, 2006 according to which if the value of material used can be bifurcated, service tax is required to be paid on the service portion at the rate of 14%. However, if it is not possible to bifurcate the value of material portion, then, service tax is to be paid on 40% of the value for original works and 70% of the value of repair and maintenance contracts (both for goods and immovable property). Earlier, before 01.10.2014, for maintenance or completion and finishing of immovable property, service tax was required to be paid on 60% of the value for such works contract. However, if your service is errection, commissioning and installation service, then service tax may be paid at the rate of 14% on the installation services excluding the value of materials on which vat is paid. {Query replied by: CA Neetu Sukhwani}
Dear Sir, We are into Interiors, We had received different PO from our Client for Material Supply & Installation. Now Supply comes under VAT/CST Component & Installation comes under Service Tax Component. Now My query is are we have to pay service tax for supply of material as Vat & service tax as 50% 50%. kindly reply the query as the earliest. Thnkyou, Regard's Saaraah. Saaraah (Posted On: 15 Sep, 2015)

Firstly, you are required to ascertain whether the service provided by you falls under errection, commissioning and installation service or works contract service. The main feature of works contract service is provision of service along with sale of material during the course of provision of service. There are three categories of works contract services:- 1. Original works 2. Repair or reconditioning or servicing of any goods 3. Maintenance or repair or reconditioning of any immovable property and completion and finishing services such as glazing, plastering, floor and wall tiling, installation of electrical fittings of immovable property etc. The valuation of works contract is governed by Rule 2A of the Service Tax (Determination of Value)Rules, 2006 according to which if the value of material used can be bifurcated, service tax is required to be paid on the service portion at the rate of 14%. However, if it is not possible to bifurcate the value of material portion, then, service tax is to be paid on 40% of the value for original works and 70% of the value of repair and maintenance contracts (both for goods and immovable property). Earlier, before 01.10.2014, for maintenance or completion and finishing of immovable property, service tax was required to be paid on 60% of the value for such works contract. However, if your service is errection, commissioning and installation service, then service tax may be paid at the rate of 14% on the installation services excluding the value of materials on which vat is paid. {Query replied by: CA Neetu Sukhwani}
Dear Sir, We are into Interiors, We had received different PO from our Client for Material Supply & Installation. Now Supply comes under VAT/CST Component & Installation comes under Service Tax Component. Now My query is are we have to pay service tax for supply of material as Vat & service tax as 50% 50%. kindly reply the query as the earliest. Thnkyou, Regard's Saaraah. Saaraah (Posted On: 15 Sep, 2015)

Firstly, you are required to ascertain whether the service provided by you falls under errection, commissioning and installation service or works contract service. The main feature of works contract service is provision of service along with sale of material during the course of provision of service. There are three categories of works contract services:- 1. Original works 2. Repair or reconditioning or servicing of any goods 3. Maintenance or repair or reconditioning of any immovable property and completion and finishing services such as glazing, plastering, floor and wall tiling, installation of electrical fittings of immovable property etc. The valuation of works contract is governed by Rule 2A of the Service Tax (Determination of Value)Rules, 2006 according to which if the value of material used can be bifurcated, service tax is required to be paid on the service portion at the rate of 14%. However, if it is not possible to bifurcate the value of material portion, then, service tax is to be paid on 40% of the value for original works and 70% of the value of repair and maintenance contracts (both for goods and immovable property). Earlier, before 01.10.2014, for maintenance or completion and finishing of immovable property, service tax was required to be paid on 60% of the value for such works contract. However, if your service is errection, commissioning and installation service, then service tax may be paid at the rate of 14% on the installation services excluding the value of materials on which vat is paid. {Query replied by: CA Neetu Sukhwani}
Sir, We are having only Manufacturer registration under Central Excise. Due to low quality, we want to sale the imported excisable raw material from the Port premises i.e. without bringing it to our factory premises. Custom duty not yet paid. Materials in bulk are lying at the port rented area. Please assists us in following queries:- a) Can we raise excise invoice under the serial number as we are issuing from our factory premises? b) How do we pass on the Custom duty? c) What other pre-caution do we have to adhere to ensure there would no non-compliance under law? RAJIV JAIN (Posted On: 15 Sep, 2015)

First of all, we can issue the excise invoice for only goods which are meant for clearance from our factory premises. Since the goods have not entered our factory premises then we cannot issue excise invoice. To pass on custom duty is not clear to us. To our understanding is that you intend to pass on the Cenvat credit. For this purpose, the goods should come to your premises. Else, you can take the dealer registration and pass on the credit. {Query replied by: CA Pradeep Jain}
Sir, I asked one question about ten days ago but still it remains unanswered.Pl. reply. KASTURI LAL SETHI (Posted On: 12 Sep, 2015)

sir, we will reply to your query soon.The queries are taken by us in chronological order. Please bear with us.
Sir, We have received raw material like angle,Channel HR Sheets etc.as Input But using it we are going to make machine inhouse then my quation is 1) received material have to treat as Input or Capital goods which is under teriff 72? 2)Should duty be pay on machine after making machine by making self invoice?3)Can we avail Capital credit on self invoice for machine as 50% in current year & remaining in next year?Yogesh Pawar Yogesh Pawar (Posted On: 11 Sep, 2015)

The materials like angles, channels etc received for manufacturing capital goods are to be treated as inputs. It is further submitted that no duty is required to be paid on the machine manufactured out of the said inputs for captive use as far as the said manufactured machine falls under the defination of capital goods and is used in the manufacture of dutiable final products. This is supported by notification no. 67/95-CE dated 16.3.1995 which provides exemption from levy of excise duty on capital goods as defined in the Cenvat Credit Rules, 2004 manufactured in a factory and used within the factory of production. As stated, that there is no need to pay excise duty on manufacture of machine, the question of availing capital goods cenvat credit does not arise. The exemption is given due to the reason that there is no point in first paying duty and then availing cenvat credit. {Query replied by: CA Neetu Sukhwani}
Sir, We have received raw material like angle,Channel HR Sheets etc.as Input But using it we are going to make machine inhouse then my quation is 1) received material have to treat as Input or Capital goods which is under teriff 72? 2)Should duty be pay on machine after making machine by making self invoice?3)Can we avail Capital credit on self invoice for machine as 50% in current year & remaining in next year?Yogesh Pawar Yogesh Pawar (Posted On: 11 Sep, 2015)

The materials like angles, channels etc received for manufacturing capital goods are to be treated as inputs. It is further submitted that no duty is required to be paid on the machine manufactured out of the said inputs for captive use as far as the said manufactured machine falls under the defination of capital goods and is used in the manufacture of dutiable final products. This is supported by notification no. 67/95-CE dated 16.3.1995 which provides exemption from levy of excise duty on capital goods as defined in the Cenvat Credit Rules, 2004 manufactured in a factory and used within the factory of production. As stated, that there is no need to pay excise duty on manufacture of machine, the question of availing capital goods cenvat credit does not arise. The exemption is given due to the reason that there is no point in first paying duty and then availing cenvat credit. {Query replied by: CA Neetu Sukhwani}
Sir, Pure agent is eligible to take credit of service tax if end customer doesn't have output service tax to claim input service? Please guide Rinkesh Motilal Jogad (Posted On: 08 Sep, 2015)

No, pure agent cannot take the cenvat credit of service tax which is availed on behalf of the end customer because cenvat credit is available only for the input services used in providing output service. The service availed in the capacity of pure agent cannot be treated as service used in providing any output service. {Query replied by: CA Neetu Sukhwani}
SIR, ONE UNREGISTERED ENTITY HAS PAID FREIGHT OVER 12-15 LACS DURING F.Y. 2014-15. WHAT IS THE IMPLICATION OF SERVICE TAX & HOW TO COMPLY WITH SINCE THE ENTITY IS UNREGISTERED AS ON DATE. SHAMBHU KR SHARMA (Posted On: 08 Sep, 2015)

As per notification no. 31/2012-ST dt 20.06.2012, if person liable to pay service tax falls under the following categories, then service tax is liable to be paid by the person liable to pay freight. The categories are:- 1. Factory registered under the Factories Act, 2. Society registered under Society Act, 3. Co-operative Society established by law, 4. Dealer registered under Central Excise Act 5. Body Corporate established under any law, 6. Partnership firm whether registered or not including Association of Persons IF entity falls under above categories, it is required to get register with Service Tax Department, pay service tax along with interest. The service tax department may also initiate penal action. However, benefit of amended penalty provisions may be availed. {Query replied by CA Neetu Sukhwani}
SIR, ONE UNREGISTERED ENTITY HAS PAID FREIGHT OVER 12-15 LACS DURING F.Y. 2014-15. WHAT IS THE IMPLICATION OF SERVICE TAX & HOW TO COMPLY WITH SINCE THE ENTITY IS UNREGISTERED AS ON DATE. SHAMBHU KR SHARMA (Posted On: 08 Sep, 2015)

As per notification no. 31/2012-ST dt 20.06.2012, if person liable to pay service tax falls under the following categories, then service tax is liable to be paid by the person liable to pay freight. The categories are:- 1. Factory registered under the Factories Act, 2. Society registered under Society Act, 3. Co-operative Society established by law, 4. Dealer registered under Central Excise Act 5. Body Corporate established under any law, 6. Partnership firm whether registered or not including Association of Persons. IF entity falls under above categories, it is required to get register with Service Tax Department, pay service tax along with interest. The service tax department may also initiate penal action. However, benefit of amended penalty provisions may be availed. {Query replied by CA Neetu Sukhwani}
At the time of filing of return , penalty for late filing was Rs. 500/- under DVAT but at the time of passing the order it was Rs. 200/- per day. What will be the rate of penalty at the time of default or at the time of passing the order Saurabh Gupta (Posted On: 05 Sep, 2015)

We do not deal in DVAT. Please ask queries related to service tax, excise, custom and DGFT.
Dear Sir WE ARE INTO BUSINESS HOTEL & RESTRUANT IN JAIPUR WE WISH TO ENQUIRE WHETHER WE CAN CLAIM SERVICE TAX INPUT CREDIT FOR PAYMENT TO SERVICE SUCH AS SECURITY SERVICE, PEST CONTROL SERVICE, BUSINESS PROMOTION (ADVERTISING) SERVICE MANISHBANSAL (Posted On: 04 Sep, 2015)

Yes, you may avail the cenvat credit of input services such as security service, pest control service, if it is in relation to the hotel and restaurant business. However, since, there is exemption in the form of abatement in accommodation services and only 40% of the restaurant services is chargeable to service tax, the remaining portion of the said services are to be considered as exempted services and consequently, the provisions of Rule 6(2), (3) of the Cenvat Credit Rules, 2004 are required to be complied with. {Query replied by: CA Neetu Sukhwani}
As per new definition of Govt. in Service Tax w.e.f. 14.5.2015, Development Authority is excluded out of Govt. What is development Authority ? Can we treat Municipal Corporation as development Authority for the purpose of Service Tax ? KASTURI LAL SETHI (Posted On: 03 Sep, 2015)

It is submitted that the terms government, governmental authority, local authority are different and are specifically defined in the Finance Act also. Therefore, every organisation is to be examined with reference to the statutory defination and we cannot make assumptions. Municipal Corporation, in our view is covered by the defination of local authority given under section 65B (31) of the Finance Act as:- Local authority is defined in clause (31) of section 65B and means the following:- • A Panchayat as referred to in clause (d) of article 243 of the Constitution • A Municipality as referred to in clause (e) of article 243P of the Constitution • A Municipal Committee and a District Board, legally entitled to, or entrusted by the Government with, the control or management of a municipal or local fund • A Cantonment Board as defined in section 3 of the Cantonments Act, 2006 • A regional council or a district council constituted under the Sixth Schedule to the Constitution • A development board constituted under article 371 of the Constitution, or • A regional council constituted under article 371A of the Constitution. {Query replied by: CA Neetu Sukhwani}
Since chsnge in definition of Govt. w.e.f. 14.5.2015, Boards, Corporations, HUDA PUDA are out of definition of Govt. If they provide taxable service under works contract service, Reverse Charge Mechanism will apply to them and they will have to pay 50% share of service tax. Am I right ? KASTURI LAL SETHI (Posted On: 01 Sep, 2015)

No, as per our analysis, the Development authorities like HUDA, PUDA etc. are although, out of the defination of government as per the newly inserted defination under section 65B(26A) but still, they will not be liable to pay service tax under partial reverse charge mechanism. This is for the reason that the reverse charge is applicable on works contract if:- • The Services of works contract are being provided by an individual, HUF, partnership firm or AOP. • The services are provided to a business entity. • The business entity should be registered as body corporate. • Both service provider and recipient should be located in taxable territory. Although, the defination of body corporate as given under the Companies Act, 2013 is very wide and corporations like HUDA, PUDA etc. would get covered under the same. However, the condition that services are provided to business entity will not be satisfied in case services are provided to HUDA, PUDA because HUDA and PUDA cannot be treated as business entity. It is worth noting that the Section 65B (17) of the Finance Act defines the term “business entity” as follows:- (17) “business entity” means any person ordinarily carrying out any activity relating to industry, commerce or any other business or profession. In our opinion, HUDA, PUDA etc. cannot be considered as business entities. However, this issue is required to be examined in depth according to the constitution of the HUDA, PUDA, its preamble and objectives etc. Hence, if HUDA, PUDA are considered as business entities by their preamble, objectives, then only they are liable to pay service tax under partial reverse charge mechanism. {Query replied by CA Neetu Sukhwani}
our company construction of school/college building/hostel. school trust have 12AA certificate under in income tax act. service tax is applicable or not rajesh gupta (Posted On: 29 Aug, 2015)

W.e.f. 11.07.2014, as per entry no. 9 of the Mega Exemption notification no. 25/2012-ST dated 20.06.2012, services provided to educational institutions by way of transportation of students, catering, security, cleaning or housekeeping services performed in such educational institution and services relating to admission to or conduct of examination are only exempt. As there is no exemption for construction of school/hostel etc., service tax is applicable. Further, is school is a trust under section 12AA of the Income Tax Act, the services provided in the nature of charitable activities alone will be exempted from the ambit of service tax. Mere registration u/s 12AA of the Income Tax Act does not grant said entity exemption from payment of Service Tax because exemption is to trust providing charitable services only. {Query replied by:- CA Neetu Sukhwani & Monika Tak}
Dear Sir, We are providing services to International Organisation who are exempted from Service tax hence would like to know , while providing services if we can avail Cenvat Credit atul amin (Posted On: 28 Aug, 2015)

If the goods are supplied to International Organisation under notification no. 108/95 then as per provisions of Rule 6(6) of Cenvat credit rules, the credit will be allowed to you. But we are providing services, for which there is no corresponding rule for the same in Cenvat Credit Rules. However, as per Rule 6(8) of the Cenvat Credit Rules, 2004 states that if the service is considered as ‘export of service’ under Rule 6A of the Service Tax Rules, 1994, then it will not be treated as exempted service. Therefore, if service provided by you satisfies the conditions of Rule 6A of the Service Tax Rules, it will be considered as export of service. Consequently, the cenvat credit could be availed by the service provider. However, if your services does not qualify as export of service as per Rule 6A of the Service Tax Rules, 1994, credit cannot be taken. {Query replied by:- CA Neetu Sukhwani & Monika Tak}
Dear Sir,our pvt. ltd co. is paying Royalty to parent compnay.On whcich we pay royalty @14%.We also pay R&D Cess @5%.We take the credit of 14% service tax. Department is asking to reverse the credit of 5%(equivalent to R&D Cess.They said that the co .has paid the extra service tax @5%, so the credit0f 5% is deniable.Please advice. ALOK GUPTA (Posted On: 10 Aug, 2015)

As per our understanding, the private company is paying service tax @ 14% on royalty and R&D Cess @5% on royalty. The revenue department is correct in asking reversal of 5% credit pertaining to R&D Cess because the said cess is not specified as duty of which cenvat credit may be taken as per Rule 3(1) of the Cenvat Credit Rules, 2004. The 5% R&D Cess is not part of service tax and so credit cannot be taken for the same. {Query replied by: CA Neetu Sukhwani}
Sir, My client which is under excise because sale is above 400 lac want to make job work and want to send on job work in that case what documentary responsibilities should be fulfill to file in excise department and whether excise duty should be charged on job work done Pradeep Parihar (Posted On: 09 Aug, 2015)

We submit that your client can avail the benefit of notification no. 214/86-CE read with Rule 4(5)(a) of the Cenvat Credit Rules, 2004 and undertake job work without charging excise duty on the job work done even when sale is above 400 Lacs. If job work is done under notification no. 214/86-CE, the principal manufacturer will undertake the liability to pay excise duty on the goods manufactured by the job worker on job work basis. Therefore, there is no need to charge excise duty on the job work done. You may refer the notification no. 214/86-CE and provisions of Rule 4(5)(a) of the Cenvat Credit Rules, 2004 for understanding the procedure to be followed in case of job work. {Query replied by: CA Neetu Sukhwani}
Sir Ji,W.r.t. input service credit, in case one has not claimed/accounted, the credit for prior to 3-4 years back transaction, can it be taken now as input credit since the time has been restricted in 2015 budget as 12 months. Earlier one could have taken input credit against payment for input services at any time on establishing payment correlation.In the accounts, part of the expenses has been booked with full amount, 112.36 i.e. 100+12.36. Whether this can be considered as availed and claimable? Looking forward for your valuable comments. SHAMBHU KR SHARMA (Posted On: 06 Aug, 2015)

From the Budget 2015 the time limit for availment of credit is extended from 6 month to 1 year. Credit can be avail within one year from the date of invoice. You cannot avail cenvat credit after expiry of one year from the date of invoice or document. If you have claimed the same in the ST-3 return then it will be termed as taken. Mere accounting enteries do not establish that we have taken credit. {Query replied by:- Monika Tak}
Sir, What is ECC No. & how to obtain the same ? manash das (Posted On: 04 Aug, 2015)

Earlier when old registration number was in operation and the online returns were not being filed, the Excise Control Code (ECC) number was in operation. It was similar to today registration number. It consisted of 15 digit code. First ten number was PAN number of manufacturer. The next two numbers were alpha code. This may "XM" or "XD" which represented the manufacturer and dealer respectively. The last three number were numeric only. This ECC number has been changed to registration number after introduction of ACES.
Sir, Can HUDA be treated as business entity for the purpose of levy of Service Tax under Works Contract Service ? If so whether reverse charge is applicable to HUDA ? KASTURI LAL SETHI (Posted On: 02 Aug, 2015)

In work contract service receiver must be a business entity registered as body corporate and service provider must be a individual, HUF, partnership firm, AOP. Then in Reverse charge mechanism 50% liability is of service provider and 50% is of service receiver for payment of service tax. But in this case service receiver is Local authority but not a "body corporate". Development authority is not covered under the definition of body corporate. hence 100% liability is of service provider. So reverse charge is not applicable to HUDA. {Query replied by:- Monika Tak}
Sir, What is the status of Housing Board regarding leviability of Service Tax under 'Works Contract Service' BEFORE 14.5.2015 and AFTER 14.5.2015 ? KASTURI LAL SETHI (Posted On: 02 Aug, 2015)

Before 14.5.2015, notification 25/2012-ST provide exemption from Services provided to the Government, a local authority or a governmental authority by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of a civil structure or any other original works meant predominantly for use other than for commerce, industry, or any other business or profession. After 14.5.2015 vide notification 06/2015-ST entry sr. no. 12(a) has been omitted. Now this became taxable. {Query replied by:- Monika Tak}
Sir, my client of which ITR-V of Ass Year 2012-13 was not received bangelore upto 31.03.2014 and that was received 03.04.2014 due to it it shown online "received after due date"and at AST of Income Tax deparetment this return not shown in that case can i refile the return of A Y 2012-13 according to CBDT circular no 9/2015 [F.NO.312/22/2015-OT], DATED 9-6-2015 with application of delay of condonation Pradeep Parihar (Posted On: 29 Jul, 2015)

We do not deal in direct taxation. We only deal in indirect taxation. Kindly ask query related to indirect taxation. {Query replied by: - Monika Tak}
Sir, we are availing canteen facility by a contractor (a partnership firm) in our facory premises. Canteen contractor is procuring all materials, making food and serving it to employees. After introduction of Reverse charge mechanism (RCM), we consider this service as a "Works Contract Service" and paid 50% service tax by service provider and 50% service receiver as per RCM. Contractor calculated 50% partial service tax after considering abatement and we, as a service recipeint, paid balance 50% service tax. We followed this practice for one year. Then in our service tax audit, auditor adviced us that this service is not coming under RCM and recommended that canteen contractor should pay 100% service tax. In this regards, my question is whether canteen contractor is defaulter for short payment service tax ? or can we produce proof of 50% service tax paid by service receiver ? Service tax dept has got 100% tax i.e. 50% from service provider and 50% by service receiver. Please guide. Service receiver is not availing service tax credit relating to canteen services. SACHIN (Posted On: 28 Jul, 2015)

Yes, the canteen contractor is defaulter for short payment of service tax. This is for the reason that the service provided by him falls under outdoor catering services wherein the liability to pay service tax is on the service provider and there is no partial reverse charge. The service tax department will not consider the service tax deposited by service receiver by mistake under the category of works contract service. The option available with the service receiver is to get refund of service tax wrongly paid by them under section 11B of the Central Excise Act, 1944. Furthermore, the service provider is legally required to pay service tax on the services provided by them irrespective of the fact that 50% service tax has been paid by the service receiver under another category of service by mistake. {Query replied by: - CA Neetu Sukhwani & Monika Tak}
Sir We have provided services to Sardar Sarovar Narmada Nigam Ltd. (SSNL) for construction of Canal during the period 01.07.12 to 30.01.14. SSNL is not a Government in itself but a Body Established by Gujarat State Government. Can we claim exemption under Sr. No. 12(d) of Notification 25/2012-ST ? Maulik Kariya (Posted On: 25 Jul, 2015)

SSNL- as name suggests that it is a Limited company and not a Government authority. But one has to see the legal documents to reach at a conclusion. The definition of "governmental authority" is given under (s) of second part of definition of impugned notification. {Query replied by:- Monika Tak}
We provide Medical TRanscription Services to person situated outside India (i.e. Export). Are we liable to file SOFTEX forms? Sagar Sheth (Posted On: 25 Jul, 2015)

we do not deal in SOFTEX forms.
If exported goods are rejected and Retuned back to India and they are not reexported then wheather we have to pay Custom Duties as we pay on Import OF goods Nimish Karwa (Posted On: 25 Jul, 2015)

If we re-export the goods then we have claim the exemption under notification number 159/95 but if you do not want to re-export the goods then you surrender the benefits taken at the time of export as per terms and conditions of notification number 94/96-customs. But the important condition in both the notifications is that the custom officer should be satisfied that the same goods were imported which were earlier exported from India. It you are not able to satisfy the custom officer about identity of goods then you have to pay full rate of custom duty. In case of re-export, one can claim the drawback upto 98% from the custom department. {Query replied by:- Monika Tak}
If exported goods are rejected and Retuned back to India and they are not reexported then wheather we have to pay Custom Duties as we pay on Import OF goods Nimish Karwa (Posted On: 25 Jul, 2015)

If we re-export the goods then we have claim the exemption under notification number 159/95 but if you do not want to re-export the goods then you surrender the benefits taken at the time of export as per terms and conditions of notification number 94/96-customs. But the important condition in both the notifications is that the custom officer should be satisfied that the same goods were imported which were earlier exported from India. It you are not able to satisfy the custom officer about identity of goods then you have to pay full rate of custom duty. In case of re-export, one can claim the drawback upto 98% from the custom department. {Query replied by:- Monika Tak}
After notification No.34/2015 of CBEC, is yarn, taxable and garments are indirectly levied excise duties? sambhav Jain (Posted On: 22 Jul, 2015)

Earlier Textile Goods were claiming exemption from Central Excise Duty under notification 30/2004. The condition is that notification was that credit on input were not taken. But by notification 34/2015, condition of non availment of Cenvat credit was changed. It was inserted that appropriate duty should be paid on inputs and no CENVAT credit has been availed on Inputs. The interpretation of this condition of "appropriate duty has been paid" was that exemption will not be available if inputs are exempt from central excise duty or attract nil rate of duty. This is based on Apex Court decision. But later CBEC came with the amendment by notification no. 37/2015 wherein it is clarified that appropriate additional duty includes goods chargeable to nil duty or concessional duty. Hence, Textile Units producing cloth from yarn are not subject to excise duty. This was also clarified by CBEC circular. However, after this amendment, the conclusion is that manufacturer should have evidence of duty payment of all those inputs which are chargeable to duty. For this purpose, you can view the article written by us in article section. {Query replied by: - Monika Tak}
Dear Sir..We have accumulated balance in cenvat and hence exports are on payment of duty including free of cost spares under warranty. Now department view is that cenvat recredit would be allowed instead of cash refund. This does not make any sense as we already have cenvat balance. Is there any way to defend our stand of seeking cash refund. Any case law would help us immensely. Thanks in advance Peter Pinto (Posted On: 21 Jul, 2015)

As per our understanding, your query is that as you have huge cenvat credit balance, you have cleared exports on payment of duty under rebate claim and you have been granted refund of excise duty paid by way of re-credit. The rebate claim of excise duty is being filed under Rule 18 of the Central Excise Rules, 2002 in terms of notification no. 19/2004-C.E. (N.T.) dated 06.09.2004. However, there is no provision under the law that the rebate shall be admissible by way of re-credit but the revenue department has the practice of allowing cash refund of excise duty paid only of the assessable value upto the factory gate. The refund of excise duty pertaining to value from factory gate to the port of export is allowed by way of re-credit in the cenvat account as the department treats the place of removal as the factory gate. Although, in case of exports, the place of removal is port of export, but the revenue department allows cash refund of FOB price (minus) expenditure pertaining to freight, insurance from factory gate to port of export. Reliance may be placed on the decision given by the Commissioner Appeals in the case of ITC LTD, [2012 (284) E.L.T. 315 (Commr. Appl.)] in which it was held that there is No express provision in Act/Rule/Notification prescribes that sanctioned rebate should be credited to assessee’s Cenvat account. Further, C.B.E. & C. Circular No. 687/3/2003-CX., dated 3-1-2003 has clarified that sanctioning authority does not have discretion to give it through credit account, and it must be refunded in cash - Rule 18 of Central Excise Rules, 2002. {Query replied by: - CA Neetu Sukhwani & Monika Tak}
Respected Sir, Sir i seek your guidance on the below facts : Is Service Tax is applicable on the Contract for production of Silica Bricks at Factory premises. Nature is we provide space, machine, material and the contractor prepares bricks form that and hand over to us. we pay to contractor on the basis of tonnes of bricks prepared by them ANAL (Posted On: 20 Jul, 2015)

This is job work done and may fall under " Business Auxiliary service" But Silica bricks is a excisable goods under chapter head 6902 and the process undertaken amounts to manufacture. Hence, no service tax is applicable in that case. But this service may also fall under supply of manpower. It is more appropriate because the material, machine and space all are provided by the principle manufacturer. Hence the service tax will be payable by you. {Query replied by:- Monika Tak}
Pl update the position of service tax On Works contract for free supply of material by service receiver in view of Bhayana Builders case s s gaur (Posted On: 19 Jul, 2015)

In the view of Bhayana builders [2015 (37) S.T.R. 525 (Tri. - Del.)] case, value of free supplies by service recipient do not comprise the gross amount charged under notification No.15/2004 under Construction of Commercial or Industrial Complex service. As per this case the value of goods and materials supplied free of cost by a service recipient to the provider of the taxable construction service, being neither monetary or non-monetary consideration paid by or flowing from the service recipient, accruing to the benefit of service provider, would be outside the taxable value or the gross amount charged. {Query replied by: - Monika Tak}
Pl update the position of service tax On Works contract for free supply of material by service receiver in view of Bhayana Builders case s s gaur (Posted On: 19 Jul, 2015)

In the view of Bhayana builders [2015 (37) S.T.R. 525 (Tri. - Del.)] case, value of free supplies by service recipient do not comprise the gross amount charged under notification No.15/2004 under Construction of Commercial or Industrial Complex service. As per this case the value of goods and materials supplied free of cost by a service recipient to the provider of the taxable construction service, being neither monetary or non-monetary consideration paid by or flowing from the service recipient, accruing to the benefit of service provider, would be outside the taxable value or the gross amount charged. {Query replied by: - Monika Tak}
Pl update the position for paying service tax free supply of material by service receiver under Works contract on. percentage method in view Bhayana Builders case S S Gaur (Posted On: 19 Jul, 2015)

In the view of Bhayana builders [2015 (37) S.T.R. 525 (Tri. - Del.)] case, value of free supplies by service recipient do not comprise the gross amount charged under notification No.15/2004 under Construction of Commercial or Industrial Complex service. As per this case the value of goods and materials supplied free of cost by a service recipient to the provider of the taxable construction service, being neither monetary or non-monetary consideration paid by or flowing from the service recipient, accruing to the benefit of service provider, would be outside the taxable value or the gross amount charged. {Query replied by: - Monika Tak}
Sir, My client registered in excise import scrap and sold that scrap to indian dealers whether he is liable to file quarterly excise return and whether excise duty liability creates Pradeep Parihar (Posted On: 18 Jul, 2015)

Registered importer is required to file a Quarterly Return in the prescribed form. The importer can pass on the duty paid imported goods to customer who can avail credit of the same. Credit on imported goods can be passed-on based on an importer’s invoice. {Query replied by: - Monika Tak}
After omission of (a),(c) and (e) of S.No.12 of Notification no.25/12-ST dated 20.6.12, service provided to Govt. has become taxable in respect of these services. Whether reverse charge mechanism under notif.30/12-ST dated 20.6.2012 as amended is applicable for payment ST 50% by Service Provider and Service Receiver ? KASTURI LAL SETHI (Posted On: 18 Jul, 2015)

Notification 25/12-ST is related to mega exemption. After omission of a, c, and e these services became taxable. In work contract service receiver must be a body corporate and service provider must be a individual, HUF, partnership firm, AOP. Then in Reverse charge mechanism 50% liability is of service provider and 50% is of service receiver for payment of service tax. But in this case service receiver is government but not a "body corporate" hence 100% liability is of service provider. {Query replied by:- Monika Tak}
Sir, my client import scrap outside india and sell that srap in india and registered in excise . 1.whether he have to file exicse return 2.whether excise duty have to pay on that sold scrap india 3.what excise return have to file and what information will be fill up in excise return Pradeep Parihar (Posted On: 17 Jul, 2015)

Registered importer is required to file a Quarterly Return in the prescribed form. The importer can pass on the duty paid imported goods to customer who can avail credit of the same. Credit on imported goods can be passed-on based on an importer’s invoice. In the excise return Name of registered importer, importer registration number, Address, invoices issued by the first stage dealer, registered importer, documents based on which the credit is passed on detail has to be fill up. {Query replied by: - Monika Tak}
Dear Sir,we have received excess credit of excise than actual.i.e supplier had made invoice for basic rate Rs.100 insead of Rs.80.They have charge excess Rs.20 in invoice. Hence excise also increase than actual.Is it needed to issue debit to supplier for reversal of excess credit?There is no material movement only we are going to issue debit note.yogesh Yogesh Pawar (Posted On: 15 Jul, 2015)

There is need of issue a debit note in which effect of rate difference and effect on duty should be shown. Reversal entry should be shown in RG23A part II. Without any material movement only rate difference debit note will be issued. {Query replied by:- Monika Tak}
Dear Sir,We are receiving water by tanker in our premises.Is it neccessary to pay service tax on GTA against consignment note received from tanker supplier ( Under Fright Inward )?Yogesh Yogesh Pawar (Posted On: 15 Jul, 2015)

We submit that ‘water’ is covered by the defination of goods as given in the section 66B(25) of the Finance Act . It is also submitted that as the consideration charged by the water supplier consists as that pertaining to water charges and transportation charges both, the same would be considered as service under the negative list tax regime. However, GTA service means any service provided or to be provided to any person, by a goods transport agency, in relation to transport of goods by road in a goods carriage and issues consignment note. To our knowledge, Tanker supplier is not a goods transport agency. Moreover, in common parlance, the tanker supplier does not issues consignment note also. Hence, the service of transportation of water by road will be exempt under section 66D(p) and no service tax is payable on the transaction. {Query replied by: -CA Neetu Sukhwani & Monika Tak}
Dear Sir, Goods received by second stage dealer from importer or first stage dealer should show A.V on bills issued by him as AV+BCD shown in B.E proportionately (In case of goods received from importer),AV as amount transferred by manufacturer to first stage dealer on proportionate basis(in case of 1st stage dealer.)OR simply Av as invoice amount exclusive of CST or Vat issued by 1st stage dealer or importer. Some trading concern says that it is not possible to show AV as they have goods of different rate. Regards CA Nitin Agarwal NITIN (Posted On: 13 Jul, 2015)

we are unable to understand your query. But as per our understanding goods will be transferred on proportionate basis. AV will not include CST or Vat. Moreover, if the trading company has different purchase bills then it is advisable to prepare separate sale bills so that the information can be incorporated. {Query replied by:- Monika Tak}
One partnership concern is starting a manufacturing unit and for establishing the same some machines are being purchased after payment of excise duty and VAT. The unit is SSI and for this reason it doesn't charge excise and/or service tax on its final clearance. VAT is charged. Now the query is that what do be done for the excise duty paid on machinery purchased. Can it be carry forward ?? Is there any provision for refund of unutilized CENVAT Credit ?? If possible please quote relevant provisions also. Manoj Khatri (Posted On: 09 Jul, 2015)

This credit is to be carry forward. As per provisions of notification 8/2003- C.E. dated 1.3.2003 and as amended, we can utilise this credit after crossing the SSI exemption limit of Rs. 1.5 crore. There is no provision for refund of unutilised credit for home consumption. {Query replied by:- Monika Tak}
Dear Sir, We would like to export our product to Bhutan under notification no 45/2001 (CE - NT). point no - for condition no 5. Question : is it mandatory to get consideration in converible foreign currency ? (as no condition found under this category regarding payment) ? can we discharge our bond by giving BRC ( where consideration is in INR) Thanking you , Regards, Hemant Hemant (Posted On: 09 Jul, 2015)

There is condition of payment in Foreign currency in point number 1 but no such clause is applicable for clause 5.
sr we have taken excise registration inlast year and still our plantunder cunstruction when should we start filing retruns from dat of registration or from dayproduction started pls clarify tmanoj kumar (Posted On: 07 Jul, 2015)

Assessee has to file nil return also or even if there is no production. If he takes registration then he has to file return from the date of registration. {Query replied by:- Monika Tak}
Dear Sir, Whether First stage and second stage dealer registered under excise required to file ER-4,5,6 . Regards CA Nitin Kumar Agarwal NITIN (Posted On: 03 Jul, 2015)

ER-4, 5, 6 return is filed by manufacturer. For registered first stage and second stage dealers has to file a quarterly return giving details of the invoices issued by them and details of documents based on which credit is passed on. This is to be filed within fifteen days from the close of the quarter to which the return relates. {Query replied by:- Monika Tak}
Dear Sir, Whether First stage and second stage dealer registered under excise required to file ER-4,5,6 . Regards CA Nitin Kumar Agarwal CA NITIN KUMARAGARWAL (Posted On: 03 Jul, 2015)

ER-4, 5, 6 return is filed by manufacturer. For registered first stage and second stage dealers has to file a quarterly return giving details of the invoices issued by them and details of documents based on which credit is passed on. This is to be filed within fifteen days from the close of the quarter to which the return relates. {Query replied by:- Monika Tak}
Sir, We have a SFIS duty scrip and i would like to know if scrip can be utilised for domestication of containers under lease purchase. nithya (Posted On: 16 Jun, 2015)

Although the term ‘domestication of containers’ is not clear, still we would like to inform you that Duty Credit Scrip may be used for import of any capital goods including spares, office equipment and professional equipment, office furniture and consumables. Apart from it Duty Credit Scrip shall also be permitted to be utilised for payment of excise for procurement from domestic sources. The capital goods for the purpose of SCHEME shall mean to be any plant, machinery, equipment or accessories required for manufacture or production, either directly or indirectly, of goods or for rendering services, including those required for replacement, modernisation, technological upgradation or expansion. {query replied by:- Monika Tak}
Dear Sir, One of my clients has received an excise invoice in which our non-excisable trader is mentioned as a consignee & in the delivery box there is our address so the question arises that can I take the credit of the invoice of the transit sale which my client has got?.PLease reply hitesh (Posted On: 14 Jun, 2015)

The two conditions are required to be fulfilled for availment of credit. One is that goods have to be received in the factory and second is that the name and address of the person wiling to avail the cenvat credit should be mentioned as consignee. In the present case, although goods have been received by your client but as the name of trader is being mentioned as consignee, the invoice will be treated in the name of trader and credit cannot be availed by your client. Alternatively, we suggest that if the name of trader is mentioned as the buyer and the name of the client is being mentioned as consignee, then your client may avail the cenvat credit on the basis of invoice issued by the manufacturer. {Query replied by:- CA Neetu Sukhwani & Monika Tak}
A CA firm purchased office. Builder charged 3.09% service tax. Can firm take this cevat credit under any existing cenvat rules gaurav gupta (Posted On: 08 Jun, 2015)

No, the CA firm cannot take cenvat credit of service tax paid on the purchase of office because there is clear cut exclusion for cenvat credit availment for construction services. As per the defination of ‘input service’ given under Rule 2(l) of the Cenvat Credit Rules, 2004, only works contract service providers or service providers engaged in provision of construction services can avail the cenvat credit of inputs/input services used in provision of such services. No other service provider can avail the cenvat credit of service tax paid on construction related services. However, there is ambiguity in the language of the defination of input service because the inclusion clause specifies services used in relation to modernisation, renovation or repairs of premises of provider of output service. But, it is advised not to avail cenvat credit on the said services as there is clear cut exclusion for the same. {Query replied by:- CA Neetu Sukhwani & Brijendra Sankhala}
Our co. is setting up wind mill plant outside factory premises for generation of electricity. The electricity would be consumed by two different legal entities. Is there any way out to avail CENVAT on CG / Input services. Peter Pinto (Posted On: 02 Jun, 2015)

There is dispute going on the taking of credit on wind mills for the generation of electricity. However, one latest decision is in our favour which says that the credit on input services used for setting up of windmill will be allowed if the electricity is used in factory premises. However, this case is slightly different as the electricity will be consumed by two different entities. If both are paying the excise duty on their final product produced from electricity then the credit should be allowed. But the department may not agree to the same. This case is prone for litigation and has to be examined in depth. {solved by:- Prayushi Jain}
Dear Sir, What i can transfer E.cess & S. cess balance to BED as per central excise notification no. 12/2015-CE (N.T.) dated 30th April, 2015, E.cess Balance : 3 lacs S.cess Balance :1.5 lacs krunal darji (Posted On: 02 Jun, 2015)

As per the provisions of notification no. 12/2015-CE (NT) dated 30.4.2015, only the credit of Education Cess and SHE Cess that is pertaining to inputs or capital goods or input services received on or after 01.03.2015, can be utilised for payment of basic excise duty. Further, the Education cess and SHE cess of balance 50% of capital goods credit received in the financial year 2014-15 may be utilised for payment of basic excise duty. It does not allows utilisation of balance of Education cess and SHE Cess available as on 01.03.2015. Therefore, you are required to calculate the amount of education cess and SHE cess that can be utilised for payment of basic excise duty. {Query replied by CA Neetu Sukhwani}
Dear All, Effective 01.03.2015, cenvat can be availed on goods directly delivered at Jobworker premises. However, in few of our challans, we have mentioned ref of not. 214/86 for material directly deliverd to Jobworker. Would writing this not. restrict us from availing credit for transactions done after 01.03.15. request you to please give your valuable advice. Peter Pinto (Posted On: 01 Jun, 2015)

There will not be any problem in writing the above notification and credit will be allowed. There is no provision in latest rule that the credit will be allowed only if job work is done under Rule 4(5) (a) of Cenvat Credit Rules.
In our factory, where are planning to provide space to another manufacturer and will charge them along wiht service tax. pl let us know if any intimation or permission to be submitted to Department and what controls would be required from Excise point of view. Peter Pinto (Posted On: 28 May, 2015)

As a part of the registered factory premises is given on rent to another manufacturer, you are required to amend your Central Excise Registration and give a revised map of your factory indicating the area of factory premises used for manufacturing activities by you. The entry and exit of the space rented should be separately demarcated. {Query replied by:- Prayushi Jain & CA Neetu Sukhwani}
Dear Sir,We know that in Uttarakhand excise exemption granted for 10 years.Suppose one of the plant has exemption is going to end in march 2016.Can we continue exemption by doing following things - 1)expend the plant by acquiring the adjacent plant/plot. 2) by adding the new manufacturing product to the same unit.3) If plant on lease then by shifting the plant to other notified location? If Yes then please give me notification/circular reference.If other ways also available to avail exemption then please suggest? Yogesh Pawar (Posted On: 26 May, 2015)

There are two exemption notification for the Uttarakand viz. 49/2003-C.E dated 10.6.2003 and 50/2003-C.E. dated 10.6.2003. You have not told about the exemption notification being availed by you. However, our reply to your query is that as per both exemption notifications, the exemption is available to only those units existed before Januray 7,2003 and have been made substantial expansion after 7th day of January 2003 but started commercial production before 31st march 2010 are available for this exemption. The units made or expanded after the said date will not be given benefit of this exemption. {query replied by:- Prayushi Jain}
Dear Sir,We know that in Uttarakhand excise exemption granted for 10 years.Suppose one of the plant has exemption is going to end in march 2016.Can we continue exemption by doing following things - 1)expend the plant by acquiring the adjacent plant/plot. 2) by adding the new manufacturing product to the same unit.3) If plant on lease then by shifting the plant to other notified location? If Yes then please give me notification/circular reference.If other ways also available to avail exemption then please suggest? Yogesh Pawar (Posted On: 26 May, 2015)

There are two exemption notification for the Uttarakand viz. 49/2003-C.E dated 10.6.2003 and 50/2003-C.E. dated 10.6.2003. You have not told about the exemption notification being availed by you. However, our reply to your query is that as per both exemption notifications, the exemption is available to only those units existed before Januray 7,2003 and have been made substantial expansion after 7th day of January 2003 but started commercial production before 31st march 2010 are available for this exemption. The units made or expanded after the said date will not be given benefit of this exemption. {query replied by:- Prayushi Jain}
If after receiving duty drawback, after which exporter give the discount wheather duty drawback to be refund on discount amount, Example Sales $250000 Company receive dutydrawback @1% on $250*63.30 =15825 At the time of receipt of payment by exporter give $1000 discount. Wheather company has to refund the proportionately dutydrawback i.e. 1000*1%*63.30= Rs.633 Nimish Karwa (Posted On: 23 May, 2015)

Ans:- If the RBI clears the transaction and BRC is issued to the exporter after considering the discount, then there is no need to refund the proportionate drawback amount to the government. However, if the discount is substantial and the RBI does not issues BRC, then the proportionate drawback is to be refunded back to the government. {Query replied by:-Prayushi Jain & CA Neetu Sukhwani}
Dear Sir On which date SWATCH BHARAT CESS is applicable on taxable Service amount or Tax on Taxable Service, and through which form it will be deposit. gaurav (Posted On: 23 May, 2015)

Swatch Bharat Cess will be levied at the rate of 2% on the value of taxable services. Till now, no date has been notified for the levy of Swatch Bharat Cess and no provision has been introduced as regards the mode of deposition of this cess. {Query replied by Brijendra Sankhala}
Dear Sir, In our office one vendor complete cabling work related to network. My query is whether this work comes under the definition of WCT as under this fitting out covered under WCT. Please reply soon, and also gives some supporting for justifying answer. Saurabh Khandelwal (Posted On: 18 May, 2015)

We do not deal in WCT (work contract tax) under VAT. Please ask query related to Service tax, Central Excise laws, and Custom laws. {Query solved by Brijendra Sankhala}
Dear Sir/ Madam My question is whether CENVAT Credit can be availed on the service tax paid on the non compete fees? Sandeep Shah (Posted On: 16 May, 2015)

According to Section 66E(e) of Finance Act, specifying ‘declared services’, the situation of agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act is also a declared service. As such, the non-compete fees is paid in lieu of providing output service. However, the issue as regards whether the cenvat credit of service tax paid on the non-compete fees will be admissible or not is a litigation prone issue. This is for the reason that the non-compete fees is being paid by a person so that the business is carried on smoothly and so indirectly, the payment of non-compete fees is related to business. Moreover, the credit of service tax paid on input service is admissible which is used for providing taxable output service or used by manufacturer, directly or indirectly in relation to manufacture of final products. Accordingly, the cenvat credit of service tax may be admissible but you are intimated that it is highly debatable and prone to dispute. {Query replied by Brijendra Sankhala & CA Neetu Sukhwani}
whether amount recovered from employee by the employer for short notice of resignation is taxable under service tax law in India? L SAI KRISHNA KUMAR (Posted On: 15 May, 2015)

Ans:- You are informed that service tax will not be charged on the amount taken for short notice of resignation as the very definition of service as defined under section 65B(44) excludes all the transactions between an employer and employee provided in relation of service. Therefore as the transaction is out of ambit of service only, question of levy of tax does not arises only. {query replied by:- Prayushi Jain}
I would like to know whether service tax payable under reverse charge on cab expenses incurred & paid by employees during their on duty/official trip.Company reimburse the taravelling expenses incurred by them. Excise audit team asks us to pay service tax on cab payment made by employees apart from bills directly received and paid by the company. Kindly advice on this issue. Srinivasan K K (Posted On: 15 May, 2015)

As the cab related expenses are reimbursed by a company to its employees which have been incurred for official purpose, the reverse charge mechanism shall be applicable on the company and therefore the company is liable to pay the service tax on the same. The Excise audit team is correct in demanding the payment. {query replied by:- Prayushi jain}
Sir A company provides services and raises bill after confirmation from the client. Ex., For April 14, the Company informs the client that 1,24,532 hits were recorded and the client has to pay Rs.2,49,064/- (i.e., at Rs.2/-) per hit. However, the client confirms only on 20th June that 1,18,500 hits have taken place and accepts a bill for 2,37,000/- only. My query is when is the Service Tax payable - whether when client confirms on 20th June 2014 or on the basis of 30th April 2014. Thanks in advance Kamalesh Kumar Z (Posted On: 11 May, 2015)

The Service Tax law does not allow raising of invoice on confirmation of service. Tax is charged only when bill is raised or payment is received, whichever is earlier. The bill is to be raised within 30 days of provision of service.
What is Profession tax return late filling penalty? What will be the consequences if we wouldn't have filed return since long/inception? Where to file the same? Please Guide. Prashant (Posted On: 10 May, 2015)

Ans:- We do not deal in profession tax. We only deal in excise, customs and service tax. Kindly ask questions related to the same only.
I am a electrical contractor. My turnover is from executing sub contract work received from a contracting Company, of residential houses is Rs 4 lakhs. Other works ie from commercial establishments is Rs 3 lakhs. I have executed Rs 25lakhs for State Govt Dept. (which includes material value like wire motor etc)of water wells for agriculture fields under Govt Scheme. I am of the opinion that my turnover is below Rs 10 lakhs hence not taxable. Executing job for irrigation related activity to State Govt is exempted u/n 25(25). pl confirm the same. How to claim exemption in ST 3 returns. basic exemption ,Govt job or only show Rs 7lakhs or Rs 32 Lakhs. previous Year TO is Rs 6lakhs only Pl clarify venkat (Posted On: 09 May, 2015)

Yes sir your turnover is below the threshold limit of Rs 10 lacs as irrigation related activity for state government is exempt under service tax by way of notification no. 25/2012-ST. In ST-3 return, you must show complete 32 lacs, claiming exemption in exemption column of Rs 25 lacs. You must also show the notification No. 25/2012-ST in exemption column. {query replied by:- Prayushi jain}
Dear Sir, we are shipping line and have charged our customer with Delay payment charges along with servic tax as they had delayed our payment and would like to if service tax will be applicable if yes kindly explain as prior to 01.07.2012 department had issued a circular to broker that service tax will not be applicable of delayed payment charges atul amin (Posted On: 07 May, 2015)

All the circulars issued prior to July 2012 have been rescinded with the introduction of the negative list. In the current scenario, all the services are taxable except those mentioned in the negative list. As far as delayed payment charges, are considered, it is not an activity performed for a consideration. It is more of a penal nature and there is no element of service involved in it. The charges recovered don’t represent any activity specifically done by you for a consideration. Thus no service tax will be applicable on it. {Query replied by:- Monika Tak}
service tax credit of rent paid on depot godown is eligible for cenvat credit. we hv taken depot registration as manufacturer's depot and taken godown on rent basis Kiran Patil (Posted On: 06 May, 2015)

Yes you can take the credit of service tax paid on rent of depot.
service tax credit of rent paid on depot godown is eligible for cenvat credit. we hv taken depot registration as manufacturer's depot and taken godown on rent basis Kiran Patil (Posted On: 06 May, 2015)

Yes you can take the credit of service tax paid on rent of depot.
Sir I wanted to know when service tax has to be pay in case of partial reverse charge.Suppose manpower supplier bill date is 01 may 15 for the service of April15 and it is received on 07may 15 then when service receiver has to pay service tax?(on 06 june or immediate after making payment of respective bill) Yogesh Pawar (Posted On: 06 May, 2015)

As per Rule 7 of Point of Taxation Rules, 2011 the liability to pay service tax under reverse charge scheme is on the date when the amount is paid to service provider. If the amount is not paid within 3 months from the date of invoice then point of taxation shall be date immediately following the said period of three months..
Sir I wanted to know when service tax has to be pay in case of partial reverse charge.Suppose manpower supplier bill date is 01 may 15 for the service of April15 and it is received on 07may 15 then when service receiver has to pay service tax?(on 06 june or immediate after making payment of respective bill) Yogesh Pawar (Posted On: 06 May, 2015)

As per Rule 7 of Point of Taxation Rules, 2011 the liability to pay service tax under reverse charge scheme is on the date when the amount is paid to service provider. If the amount is not paid within 3 months from the date of invoice then point of taxation shall be date immediately following the said period of three months..
Dear sir, We have received service from civil contractor, but he is not paid any partial ST and also he is not registered even he crossed limit of 10 lak, in that case we have to pay partial reverse charge of ST or not? Pls clarify. Regards Subramani.P subramani.p (Posted On: 05 May, 2015)

Yes, you shall have to pay Service Tax under partial reverse charge. As in partial reverse charge both service provider and receiver have to pay their respective tax liability. You are liable to pay tax and you ought to deposit the same even if the service provider has not paid the tax. Even if the service provider is covered under the threshold limit then also service receiver is liable to pay tax.
Hello Sir, I am CA - inter student and working in a corporate. I am stuck to 1 point on Service tax on online advertising w.e.f. 1st Oct, 2014 and income from Apps: Brief Facts - We are basically promoting our apps outside India through one of our vendor who is also located outside India i.e. non-taxable territory. - These Apps are advertised on different social media and targeted to a particular Country/Audience at one point of time. - These are the sort of online adds which pop-ups while one surfs online on the social media. - these services have been utilised in promoting our apps across the world through the social media in the form of advertisement. - Both the service recepient and service provider are outside India in Non-taxable territory. - In turn, We get amount in foreign currency in the form of income from Apps also on the basis of the no. of hits. Questions: 1. Amount paid to vendor for promoting our apps (Both service receiver and service provider located outside India) is chargeable to Service tax under reverse charge? Can we apply Rule 3 general rule becuase in this case place of service receiver is not available, then the location of service provider as per POPS which is located outside India and hence no liability under reverse charge of paying service tax. 2. Amount of income received on the basis of no. of hits from Google who has PE in India but we are receiving amount in forex i.e. in foreign convertible exchange. Are we liable to pay service tax or we should treat it as export of service income. Please help sir in clarifying the above two points please. Looking forward for your response. Avinash Jain (Posted On: 04 May, 2015)

Referring to your question no. 1, to the best of our understanding, the service provider is the vendor and you yourself are the service receiver. As explained by you that vendor is the service provider and the audience is the service receiver is principally incorrect. The reason being that vendor is actually providing you the services of advertisements and charging for the same. He has no interaction with the audience. Now as the advertisement services are no where mentioned specifically in the POPS rules, thus rule 3 will prevail and the location of service receiver will be the place of provision of service. As you are the service receiver, your location will be the place of provision of service and you shall be liable to pay the service tax under reverse charge mechanism. {Query replied by: - Monika Tak}
Dear Sir , Whether LLP is body corporate under service tax for the purposes of reverse charge. Pls. guide me. Thanks and Regards Amit Gupta Suncity PRojects Pvt. LTD Amit Gupta (Posted On: 30 Apr, 2015)

the body corporate has same meaning in Service Tax as mentioned in Section 2(7) of Companies Act, 1956 which is:- "body corporate" or "corporation" includes a company incorporated outside India but does not include a corporation sole; Hence LLP is not considered as body corporate.
Dear Sir, kindly advice under ER-7 details of plant and machinery installed, weather it is installed machinery during the concerned financial year or the complete machinery since the beginning as on to date.2nd, can we change annual production capacity based on additional machinery installed regards Vinod K B vinodkb (Posted On: 27 Apr, 2015)

In ER-7 return the detail for machineries installed must be right from the beginning of the business till today. Yes we can change the annual production capacity based on additional machinery installed.
Sir, I am a electrical contractor.My turnover is from executing sub contract work received from a contracting Company, of residential houses is Rs 4 lakhs. Other works ie from commercial establishments is Rs 3 lakhs.I have executed Rs 25lakhs for State Govt Dept. erection and commissioning (which includes material value like wire motor etc)of water wells for agriculture fields under Govt Scheme.I am of the opinion that my turnover is below Rs 10 lakhs hence not taxable. Executing job for irrigation related activity to State Govt is exempted u/n 25(25). pl confirm the same. How to claim exemption in ST 3 returns.basic exemption ,Govt job or only show Rs 7lakhs or Rs 32 Lakhs. previous Year TO is Rs 6lakhs only Pl clarify Ramana venkat (Posted On: 26 Apr, 2015)

Yes sir your turnover is below the threshold limit of Rs 10 lacs as irrigation related activity for state government is exempt under service tax by way of notification no. 25/2012-ST. In ST-3 return, you must show complete 32 lacs, claiming exemption in exemption column of Rs 25 lacs. You must also show the notification No. 25/2012-ST in exemption column. {query replied by:- Prayushi jain}
Dear sir, we are manufacturers & exporter of readymade garments.which excise return should we submit ER2 or ER3 regards Vinod K B vinodkb (Posted On: 24 Apr, 2015)

You are informed that ER-2 is monthly return filed by 100% EOU and ER-3 is quarterly return for SSI exemption scheme unit. ER-1 return is monthly return filed by assessees not availing SSI exemption benefit. You are required to file return according to the category of assessee in which you fall. {Query replied by: CA Neetu Sukhwani}
Dear sir, we are a manufacture and exporter of readymade garments. sir pls advice which excise return should we apply i.e.ER2 OR ER3 THANKS & REGARDS VINOD K B vinodkb (Posted On: 24 Apr, 2015)

You are informed that ER-2 is monthly return filed by 100% EOU and ER-3 is quarterly return for SSI exemption scheme unit. ER-1 return is monthly return filed by assessees not availing SSI exemption benefit. You are required to file return according to the category of assessee in which you fall. {Query replied by: CA Neetu Sukhwani}
Dear Sir, Our one supplier charging excise duty on Transportation cost i.e. he is charging excise duty on Assy Value + Transportation cost. Is it correct as per excise law or not? I think duty to be charge on manufacturing only not service value. Your valuable opinion require? Yogesh Pawar (Posted On: 24 Apr, 2015)

If the supplier is charging excise duty on transportation cost plus assessable value, then the sales must be on ‘Free on Receipt’ basis. In such a case, the supplier is adopting the practice because he must be availing the credit of service tax paid on transportation of goods from his factory premises to your premises. Alternatively, if you wish to avail the cenvat credit of service tax on transportation, then you may pay the freight and bear the burden of service tax and in such a situation, excise duty will not be paid on the transportation cost by the supplier. {Query replied by: CA Neetu Sukhwani}
DearSir, My question is a Raw material consist of excise where as output is exempted from excise? How do we utilise our input? Please give me respective notification or circular and please give me your valuable reply. Rakesh Gupta (Posted On: 23 Apr, 2015)

your query is not clear. However, we understand that the excise duty input is used in manufacture of exempted goods. Then the credit of the same will not be allowed.
sir, My query is for F.Y.2010-11 & 2011-12 if contractor is constructing national highways exempt from service tax and gets security services from other contractor will he also be exempt from service tax as it is also a type of support service only. Thanks Rishi Prakash Rishi Prakash (Posted On: 22 Apr, 2015)

It is submitted that if exemption is given to the service of constructing national highways then it cannot be interpreted that all services used in constructing national highways will be exempt. Accordingly, the service tax will be payable on the security services availed by the contractor. {Query replied by: CA Neetu Sukhwani}
Dear Sir, Whether painting work on new construction is cover under original work or finishing work for the purpose of valuation. Pls. guide me. Thanks and Regards Amit Gupta Suncity Projects Pvt.Ltd. Amit Gupta (Posted On: 21 Apr, 2015)

The painting work on new construction will be covered by finishing work for the purpose of valuation and will not be considered as original works. {Query replied by: CA Neetu Sukhwani}
Whether painting work on new construction is cover under original work or finishing work for the purpose of valuation. Pls. guide me. Thanks and Regards Amit Gupta Suncity Projects Pvt.Ltd. AMIT GUPTA (Posted On: 21 Apr, 2015)

The painting work on new construction will be covered by finishing work for the purpose of valuation and will not be considered as original works. {Query replied by: CA Neetu Sukhwani}
MEIS SCHEME IS APPLICABLE FROM 01 APRIL 2014 BUT IN PARA 3.14(a) it is written that we have to declare in shipping bill for 01 june 2014 Nimish Karwa (Posted On: 15 Apr, 2015)

As in the dates mentioned by you in the query are not clear and it seems that you may have been confused in reading the dates. The applicability of the MEIS scheme is from 01/04/2015. To the best of our understanding, we would like to inform you that from 1st of June 2015, putting a declaration on the shipping bills stating that “We intend to claim rewards under Merchandise Exports From India Scheme (MEIS”)” has been made mandatory to claim the benefit of the scheme. In absence of such declaration, the benefit may be denied by the authorities. However, nowhere it is mentioned that it will not be available for the month of April and May. The only thing is that we have to start declaring it from June 1, 2014. {query replied by:- Monika Tak}
Dear Sir, I want to ask one question as Suppose we have received excisable material in the month of Jan 2015 but by mistake we did not inward it in that particular month. it is inwarded in the month of April 2015. Is it allow to do so in case of excise law? If yes then please give me respective notification or circular. Somebody told me it is allowed till 6 month. I am not agree with him so please give me your valuable reply. Yogesh Pawar (Posted On: 13 Apr, 2015)

Actually, the time limit for availing cenvat credit on inputs was introduced w.e.f. 11.7.2014 as “six months” from the date of issue of invoice. Consequently, you may have been informed that you should pass entry of material inward within period of 6 months from the date of invoice. However, it is worth noting that this time limit has been enhanced to “one year” w.e.f. 1.3.2015. We submit that there is no time limit of recording receipt of raw material and it is only that if the material is entered in the books within a period of one year, the credit is admissible. You cannot avail Cenvat credit after expiry of one year from the date of invoice. {Query replied by: CA Neetu Sukhwani}
Dear Sir, I want to ask one question as Suppose we have received excisable material in the month of Jan 2015 but by mistake we did not inward it in that particular month. it is inwarded in the month of April 2015. Is it allow to do so in case of excise law? If yes then please give me respective notification or circular. Somebody told me it is allowed till 6 month. I am not agree with him so please give me your valuable reply. Yogesh Pawar (Posted On: 13 Apr, 2015)

Actually, the time limit for availing cenvat credit on inputs was introduced w.e.f. 11.7.2014 as “six months” from the date of issue of invoice. Consequently, you may have been informed that you should pass entry of material inward within period of 6 months from the date of invoice. However, it is worth noting that this time limit has been enhanced to “one year” w.e.f. 1.3.2015. We submit that there is no time limit of recording receipt of raw material and it is only that if the material is entered in the books within a period of one year, the credit is admissible. You cannot avail cenvat credit after expiry of one year from the date of invoice. {Query replied by: CA Neetu Sukhwani}
Sir, My query on Exp-2 in future. Union Budget made provision to exempt services used for export. Kindly clarify as NOW GTA service exempted for upto Border, whether we need to file Exp-2 returns?? with best regards. D.S.Murthy (Posted On: 13 Apr, 2015)

Sir, firstly you are informed that the requirement of filing EXP-4 has been dispensed with and still, there is requirement to file EXP-2. EXP-4 is filed for service tax on commission paid to foreign agent and the reason for dispensing with the requirement to file EXP-4 is that due to amendment in the Place of Provision Rules, 2012, the intermediary includes commission agent for goods and services both. As such, according to Rule 9 of the Place of Provision of Service Rules, 2012, the place of provision of service is location of service provider which is outside India in case of commission agent situated abroad. Therefore, no service tax is leviable and this procedural requirement had become redundant. However, the assessees are required to file EXP-4 for the period October, 2014 to March, 2015 upto 15.4.2015 else they may face penal proceedings. We once again intimate that the assessees will continue to file EXP-2. {Query replied by: CA Neetu Sukhwani}
can a unregistered dealer send material via transit invoice without bringing goods to his premises? amit (Posted On: 12 Apr, 2015)

The amendment made by way of insertion of third proviso in Rule 11(2) is ambiguous and is amenable to different interpretations. The position is not clear but many opine that now, the cenvat credit in case of buyer-consignee model is admissible only on the strength of cenvatable invoice issued by registered dealer. It seems that this provision has been inserted to curb passing of fake cenvat credit by registered dealers by issuing own invoices and as well as passing credit on the basis of manufacturer’s invoice. This provision certainly applies to registered dealers and in my view, as there is no embargo in availing cenvat credit on the strength of invoice issued by manufacturer, the same may be availed if goods are procured via unregistered dealer. However, the issue is prone to litigation and so the decision should be taken after considering the costs of litigation. {Query replied by: CA Neetu Sukhwani}
sir,as per the amendment made by budget 2015 registered first stage dealer and ssd can now send the goods directly from manufacturer premises to thier buyer. whether this means that the practice of transit invoice where the recepient manufacturer name can be written in the consignee column and dealer need not be beregistered stands withdrawn?? vinay jain (Posted On: 11 Apr, 2015)

The amendment made by way of insertion of third proviso in Rule 11(2) is ambiguous and is amenable to different interpretations. The position is not clear but many opine that now, the cenvat credit in case of buyer-consignee model is admissible only on the strength of cenvatable invoice issued by registered dealer. It seems that this provision has been inserted to curb passing of fake cenvat credit by registered dealers by issuing own invoices and as well as passing credit on the basis of manufacturer’s invoice. This provision certainly applies to registered dealers and in my view, as there is no embargo in availing cenvat credit on the strength of invoice issued by manufacturer, the same may be availed if goods are procured via unregistered dealer. However, the issue is prone to litigation and so the decision should be taken after considering the costs of litigation. {Query replied by: CA Neetu Sukhwani}
Querry: We are selling Ice Creams in a Shop(Air conditioned) which is on Rented and charge service Tax @ 40% on sales price (Invoice raised). can we get cenvat credit on Rent, telephone exp paid of that shop and service tax paid on inputs also.... Please reply.. Thanks in advance. Regards Anil Jain Anil Jain (Posted On: 09 Apr, 2015)

You are providing restaurant services wherein as per Rule 2C of Service Tax (Determination of Value) Rules, 2006, you are required to pay service tax on 40% of the value of services thereby meaning that 60% of the value of services are being exempt. Moreover, in explanation 2 to the Rule 2C, it is clearly mentioned that the provider of restaurant service shall not take cenvat credit of any goods classifiable under chapter 1 to 22 of the Central Excise Tariff Act, 1985. This means that the service provider may avail cenvat credit of inputs (except chapter 1 to 22), input services and capital goods. Further, as 60% of value is exempted, the provisions of Rule 6 are attracted and the cenvat credit is admissible only to the extent of 40%. {Query replied by: CA Neetu Sukhwani}
Querry: We are selling Ice Creams in a Shop(Air conditioned) which is on Rented and charge service Tax @ 40% on sales price (Invoice raised). can we get cenvat credit on Rent, telephone exp paid of that shop and service tax paid on inputs also.... Please reply.. Thanks in advance. Regards Anil Jain Anil Jain (Posted On: 09 Apr, 2015)

You are providing restaurant services wherein as per Rule 2C of Service Tax (Determination of Value) Rules, 2006, you are required to pay service tax on 40% of the value of services thereby meaning that 60% of the value of services are being exempt. Moreover, in explanation 2 to the Rule 2C, it is clearly mentioned that the provider of restaurant service shall not take cenvat credit of any goods classifiable under chapter 1 to 22 of the Central Excise Tariff Act, 1985. This means that the service provider may avail cenvat credit of inputs (except chapter 1 to 22), input services and capital goods. Further, as 60% of value is exempted, the provisions of Rule 6 are attracted and the cenvat credit is admissible only to the extent of 40%. {Query replied by: CA Neetu Sukhwani}
Sir, WE: Company Details: CLP India Pvt. Ltd an Independent Power Producer having Combined Cycle Power Plant located on Bharuch-Palej road, about 10 km North of Bharuch Railway Station in District Bharuch of the State of Gujarat, India. GPEC is a 100% subsidiary of CLP PA, a Hong Kong based company. CLP India Pvt. Ltd is a 655 MW gas based dual fuel Combined Cycle Power Plant. CLPIPL Plant is capable of running either on Natural Gas or on Naptha. Currently the plant operates on Natural Gas. We have power Purchase agreement with Gujrat Government (GUVNL) Being a power generating company we are not registered with Excise department . According to recent notification 36/2013 of against 139/A we need to obtained Certificate for the usage of RLNG (End use Certificate) Can you Guide for the correct procedure for the process of application? Who will endorsed as do not have any excise registration Any guideline for processing application? We have contacted our local Excise superintendent; however he suggested that as we do not have any registration with excise he is not authorised for such endorsement . Thanks Satish Joshi 9924143161 satish Joshi (Posted On: 07 Apr, 2015)

We hereby intimate that there is not requirement for getting excise registration for claiming the benefit of the customs notification no. 12/2012 and the Central Excise Authorities cannot refuse to grant the end-use certificate to you. You may write a letter requesting to grant you end-use certificate along with the copy of the notification and the condition no. 100 specified in this regard. {Query replied by: CA Neetu Sukhwani}
Can you provide me Standard Input Output Norms(SION)notified for Optical Fibre cable For Advance Authorisation Licence On DGFT SITE IT IS AVAILABLE SION (Compressed) as on 31.05.2009 CAN you provide me latest one Nimish Karwa (Posted On: 07 Apr, 2015)

SION (Compressed) as on 31.05.2009 available on DGFT site is latest one. There is no other SION notified for optical fibre cable for Advance Authorisation License. {Query replied by: - Monika Tak}
Can you provide me Standard Input Output Norms(SION)notified for Optical Fibre cable For Advance Authorisation Licence On DGFT SITE IT IS AVAILABLE SION (Compressed) as on 31.05.2009 CAN you provide me latest one Nimish Karwa (Posted On: 07 Apr, 2015)

SION (Compressed) as on 31.05.2009 available on DGFT site is latest one. There is no other SION notified for optical fibre cable for Advance Authorisation License. {Query replied by: - Monika Tak}
Can you provide me Standard Input Output Norms(SION)notified for Optical Fibre cable For Advance Authorisation Licence On DGFT SITE IT IS AVAILABLE SION (Compressed) as on 31.05.2009 CAN you provide me latest one Nimish Karwa (Posted On: 07 Apr, 2015)

SION (Compressed) as on 31.05.2009 available on DGFT site is latest one. There is no other SION notified for optical fibre cable for Advance Authorisation License. {Query replied by: - Monika Tak}
Can you provide me Standard Input Output Norms(SION)notified for Optical Fibre cable For Advance Authorisation Licence On DGFT SITE IT IS AVAILABLE SION (Compressed) as on 31.05.2009 CAN you provide me latest one Nimish Karwa (Posted On: 07 Apr, 2015)

SION (Compressed) as on 31.05.2009 available on DGFT site is latest one. There is no other SION notified for optical fibre cable for Advance Authorisation License. {Query replied by: - Monika Tak}
Can you provide me Standard Input Output Norms(SION)notified for Optical Fibre cable For Advance Authorisation Licence On DGFT SITE IT IS AVAILABLE SION (Compressed) as on 31.05.2009 CAN you provide me latest one Nimish Karwa (Posted On: 07 Apr, 2015)

SION (Compressed) as on 31.05.2009 available on DGFT site is latest one. There is no other SION notified for optical fibre cable for Advance Authorisation License. {Query replied by: - Monika Tak}
We have Intra Plant within factory plant with same permises same excise registration. Intra plant RAW material movement Exicse duty debited now applied for refund claim. any judgement and case study for supporting document or guide for that. Jitendra (Posted On: 04 Apr, 2015)

As per our understanding, your query is that you have mistakenly paid excise duty on intra movement of raw material from one division in your factory premises to the other division of the same premises and now refund is being claimed by you. We have not come across any judgement on this issue but you are entitled to file refund claim for the same because no duty was required to be paid on intra movement of raw material within factory premises. {Query replied by: CA Neetu Sukhwani}
Budgetary changes effective from 1ST APRIL 2015 1.Services of effluent treatment by an operator of Common Effluent Treatment Plant have been exempted Q: Is this applicable for Factories or Govt Common effluent plant, pls clarify. Regards Subramani.P TAFE subramani.p (Posted On: 02 Apr, 2015)

With the Budget, exemption has been provided to services provided by operator of Common Effluent Treatment Plant by way of treatment of effluent. Nothing is specified as regards which type of Common Effluent Treatment Plant and so this means that exemption is to every common effluent treatment plant whether established for factories or government. {Query replied by CA Neetu Sukhwani}
Professional/vocational fees on instructions and lessons imparted to patients/students on Yoga, is exempt from Service Tax. K.D.GANDHI (Posted On: 31 Mar, 2015)

No. as per entry no. 8 of Mega Exemption notification no. 25/2012-ST dated 20.06.2012, “Services by way of training or coaching in recreational activities relating to arts, culture or sports” is exempt. As yoga is not covered under either of the categories, i.e. arts, culture or sports, there is no exemption from levy of service tax to fees for teaching yoga except the threshold small scale service provider exemption. {Query replied by CA Neetu Sukhwani}
Sir, A manufacturing unit registered under Partnership Act and also covered under Excise and Service Tax. Now, this unit has deployed some Contractors for cleaning and refills the oil, water and related works in the machine shop of the unit. Till date, the Contractor / Man Power Agency supplier has charged the service tax on us in their bill. As per the budget 2015-16, the man power provider has not liable to raise the Service Tax on their bill. Now, the Reverse Charge Mechanism has applicable to this unit or not? rvperumal (Posted On: 25 Mar, 2015)

Reverse charge is applicable when provider is individual, HUF or partnership firm and receiver is body corporate. But in this case, the service recipient is partnership firm, hence the reverse charge will not be applicable.
Dear Sir, We use to send both excisable and non excisable inputs (raw and partially processed)to jobworker. my question is which challan we should use for the movement of goods & what is the difference between 4(5)a & 214(86) challan. Nawal Gupta (Posted On: 23 Mar, 2015)

The Rule 4(5)(a) falls under Cenvat Credit Rules, 2004 and hence Cenvatable inputs can be sent under the same. It allows the manufacturer to clear the goods from factory for job work. The Notification 214/86 grants exemption to job worker. It can also cover non cenvatable inputs also. But normally these two procedures are used simultaneously. The challan made under these provision clearly mentioned “Job work challan issued under Rule 4(5)(a) read with Notification 214/86. {Query replied by: - Monika Tak}
As per n.n 25/2012 service tax 30. Carrying out an intermediate production process as job work in relation to - (a) agriculture, printing or textile processing; (b) cut and polished diamonds and gemstones; or plain and studded jewellery of gold and other precious metals, falling under Chapter 71 of the Central Excise Tariff Act ,1985 (5 of 1986); (c) any goods on which appropriate duty is payable by the principal manufacturer; or (d) processes of electroplating, zinc plating, anodizing, heat treatment, powder coating, painting including spray painting or auto black, during the course of manufacture of parts of cycles or sewing machines upto an aggregate value of taxable service of the specified processes of one hundred and fifty lakh rupees in a financial year subject to the condition that such aggregate value had not exceeded one hundred and fifty lakh rupees during the preceding financial year; So the job worker has not to charge service tax But if he wrongly chages service tax in the bill and if we take the credit on the basis of which Wheather depart will disallow Nimish Karwa (Posted On: 16 Mar, 2015)

According to various judicial pronouncements, it is clear that credit availment cannot be challenged at the end of service recipient if the service tax payment is not disputed at the end of service provider. However, the revenue department will surely object credit availment of the service tax paid by the job worker when there was no need to pay service tax due to exemption in force. But, in our opinion, the credit can be legitimately availed because there is no provision under the Service Tax laws as section 5A(1A) in Excise Act, 1944. In excise, there is section 5A(1A) that if there is absolute exemption, then the manufacturer is not liable to pay excise duty and if the duty is paid, it will not be treated as duty. Accordingly, it is difficult to avail cenvat credit of excise duty if there was complete exemption. But, as there is no similar provision in service tax, the contention of assessee becomes stronger. Accordingly, the issue is prone to litigation and availment of service tax credit when there is absolute exemption should be avoided. {Query replied by: CA Neetu Sukhwani}
Dear Sir, My query is that there is balance remaining in the end of feb-15 in the 2% & 1& of the cenvat A/c now can I carry forward the balance in the month of march or not as u know that the FM has removed 2% & 1&(cesses) from central excise effected from 01-03-15 so what I have to do Please.reply hitesh (Posted On: 15 Mar, 2015)

The answer to your question has not been given in the amendments made in the Budget, 2015. There remains ambiguity as regards the balance of Education Cess and SHE Cess available with the manufacturers as on 28.02.2015. There are different interpretations of different consultants and you may also refer our article titled “Exemption to E Cess and SHE Cess-Really Lucrative?” on our website in Articles section wherein we have analysed the probable consequences of the exemption given to Education cess and SHE Cess. We can only suggest you to wait until clarification is issued by CBEC in this regard. {Query replied by: CA Neetu Sukhwani}
Our Pvt Ltd buy the commercial Property on Rental Basis on Long term lease & cenvet of Service tax is available { Charge by Seller } we have to raised the commission & labor charges bill to third Party with Service Tax , Can we adjust against cenvat available with us . mahendra P Sharma (Posted On: 07 Mar, 2015)

Ans:-yes sir you can adjust it with Cenvat available with you. Input credit of Service Tax can be taken for all the services which are used in providing output services directly or indirectly. Therefore if there is any relation between the input service with your output service then you can utilize the credit. {query replied by:- Prayushi jain}
Gd afternoon Sir !I am working in a logistics company and our company has driven e invoicing facility for services which we have provided to our customer ( Import - Export ) and taken initiative for Go Green(Paper Less ) I have a query related to service tax credit .I want to know that can any manufacturer or trader avail service tax benefit on electronically generated invoice . If yes then is it mentioned on service tax notification.Please hep me Vikas Tiwari (Posted On: 07 Mar, 2015)

Yes, a manufacturer or trader can avail service tax credit on the basis of electronically generated invoice but on the condition that the invoice mentions the fact that “This is computer generated invoice and does not require signature”. There is no notification as such but there are various decisions that substantial benefit of credit should not be denied for procedural lapses. One such decision was given in the case of IN RE : CREATIVE ARCHITECTS & INTERIORS [2012 (26) S.T.R. 477 (Commr. Appl.)] wherein it was held that denial of cenvat credit on the ground that there was no signature on the invoice is not tenable because no signature is required on computer generated invoice. Moreover, with the Budget, 2015, the Rule 4C of the Service Tax Rules provides for authentication of invoice by means of digital signature. We being in the era of e-commerce, the service tax credit cannot be denied for the reason that invoice is computer generated and does not bear signature. {Query replied by: CA Neetu Sukhwani}
Suppose an assesse has business of selling electronic items such as laptops, computers etc. And providing services of reapiring these things. So can he take input of say telephone bill as he is using the same phone for providing services and selling goods??? Or is there any other alternate ?? And he can take input of what all services ? shubham kankaria (Posted On: 07 Mar, 2015)

The assessee who is engaged in trading of goods and provision of repair services cannot avail entire credit on common input services availed by him according to provision of Rule 6 of the Cenvat Credit Rules, 2004. The activity of trading of goods has been included in the defination of exempted services and consequently, the assessee is deemed to provide taxable and exempted services. Consequently, the assessee may either maintain separate accounts for input services used in exempted services, or proportionately reverse the credit attributable to exempted services as per prescribed formula or reverse 6% of the value of exempted services in accordance with the provisions enshrined in Rule 6 of the Cenvat Credit Rules, 2004. The assessee cannot take entire cenvat credit of common input services used in providing taxable and exempted services. {Query replied by: CA Neetu Sukhwani}
Respected sir Our business is manufacturing Ice cream (CETSH No.21050000). There are 4 manufacturing units (say A,B,C & D) registered as 4 partnership firms in different parts of Kerala having separate registration for Sales Tax, Central Excise, Service Tax and separate PANs. These units are manufacturing Ice cream under common brand name (units are located in rural area –but SSI exemption is not available currently as TO exceeds limits). We are paying Excise Duty after claiming exemption under Notification No.1/2011-C.E. @ 2% and hence no CENVAT credit is available. We are presently facing a service tax issue as described below. During FY 2013-14 unit “A” incurred huge amount on advertisement expenses (celebrity payment and media advertisement) for establishing the brand name in the market (on behalf of all the units). At the end of the FY (i.e. In March 2014) unit “A” issued two service tax invoices as brand promotion services-one each on unit “B & C”(unit “D” was excluded because of loss made during the year) after adding advertisement services to its Service Tax registration certificate. These invoices were raised proportionately based on some internal calculations. Unfortunately we didn’t include these two invoice in the service tax Return filed for the 6 months period ending March 2014 due to some misunderstanding and/or misguidance on the part of employees and management were unaware of this situation. During one month back an intelligence officer from Central excise office visited the office of unit “ A” and found that in the audited Financial statement this brand promotion service charges have been credited in the P & L and verified the corresponding invoice. It is clear from the invoice that service tax have been billed in the invoice and now they have issued a summons u/s 14 of Central Excise Act (made applicable to Service Tax u/s 83 of Finance Act 1994) to produce documents such as audited Financial Statements, copy of Brand promotion service charge invoices etc. My queries in this connection are as follows:- 1. Was there anything wrong ( a) in taking registration as advertisement service provider by the Ice cream manufacturing unit(partnership firm)-some officer orally told us to cancel registration earlier??!! ( b) invoicing other brand name sharing units and taking input service tax credit on advertisement in media and celebrity payment. (We consider this as separate business and hence hope that non availability CENVAT due to availing of exemption notification for ice cream will not affect this. Further we do not want to claim input tax on unit A’s portion of brand promotion expenses.) 2. If queries explained in point one are favorable to us then how to rectify the Service Tax Return (only GTA-reverse tax have been included in the STR) as 90 days of filing the return are already over? 3. What stand should we take while appearing before the intelligence officer as he has already issued a summons? 4. Any other advice in this connection. Alex (Posted On: 03 Mar, 2015)

There was nothing wrong in taking registration as an advertisement service provider and passing on the cenvat credit as far as Unit A has charged service tax from B and C and has paid the service tax to the government exchequer. The reason for the same being that unit A has passed on credit in the capacity of advertisement service provider. Further, unit A has correctly not availed the cenvat credit of service tax pertaining to its share as the said service was in relation to excisable goods cleared under notification no. 1/2011. We submit that as the time limit to revise the STR has been expired, Unit A may intimate the service tax department by way of letter that they failed to reflect the transactions in STR. {Query replied by: CA Neetu Sukhwani}
Our business is manufacturing Ice cream (CETSH No.21050000). There are 4 manufacturing units (say A,B,C & D) registered as 4 partnership firms in different parts of Kerala having separate registration for Sales Tax, Central Excise, Service Tax and separate PANs. These units are manufacturing Ice cream under common brand name (units are located in rural area –but SSI exemption is not available currently as TO exceeds limits). We are paying Excise Duty after claiming exemption under Notification No.1/2011-C.E. @ 2% and hence no CENVAT credit is available. We are presently facing a service tax issue as described below. During FY 2013-14 unit “A” incurred huge amount on advertisement expenses (celebrity payment and media advertisement) for establishing the brand name in the market (on behalf of all the units). At the end of the FY (i.e. In March 2014) unit “A” issued two service tax invoices as brand promotion services-one each on unit “B & C”(unit “D” was excluded because of loss made during the year) after adding advertisement services to its Service Tax registration certificate. These invoices were raised proportionately based on some internal calculations. Unfortunately we didn’t include these two invoice in the service tax Return filed for the 6 months period ending March 2014 due to some misunderstanding and/or misguidance on the part of employees and management were unaware of this situation. During one month back an intelligence officer from Central excise office visited the office of unit “ A” and found that in the audited Financial statement this brand promotion service charges have been credited in the P & L and verified the corresponding invoice. It is clear from the invoice that service tax have been billed in the invoice and now they have issued a summons u/s 14 of Central Excise Act (made applicable to Service Tax u/s 83 of Finance Act 1994) to produce documents such as audited Financial Statements, copy of Brand promotion service charge invoices etc. My queries in this connection are as follows:- 1. Was there anything wrong ( a) in taking registration as advertisement service provider by the Ice cream manufacturing unit(partnership firm)-some officer orally told us to cancel registration earlier??!! ( b) invoicing other brand name sharing units and taking input service tax credit on advertisement in media and celebrity payment. (We consider this as separate business and hence hope that non availability CENVAT due to availing of exemption notification for ice cream will not affect this. Further we do not want to claim input tax on unit A’s portion of brand promotion expenses.) 2. If queries explained in point one are favorable to us then how to rectify the Service Tax Return (only GTA-reverse tax have been included in the STR) as 90 days of filing the return are already over? 3. What stand should we take while appearing before the intelligence officer as he has already issued a summons? 4. Any other advice in this connection. Alex (Posted On: 03 Mar, 2015)

There was nothing wrong in taking registration as an advertisement service provider and passing on the cenvat credit as far as Unit A has charged service tax from B and C and has paid the service tax to the government exchequer. The reason for the same being that unit A has passed on credit in the capacity of advertisement service provider. Further, unit A has correctly not availed the cenvat credit of service tax pertaining to its share as the said service was in relation to excisable goods cleared under notification no. 1/2011. We submit that as the time limit to revise the STR has been expired, Unit A may intimate the service tax department by way of letter that they failed to reflect the transactions in STR. {Query replied by: CA Neetu Sukhwani}
sir we are engaged in shipbreaking activity in mumbai and during the process of shipbreaking exciseable and non exciseabke goods are sold.we are taking the credit of service tax paid on various services such as mbpt rent, labour contractor, bank charges etc. dept. has issued scn asking us to reverse service tax as per rule 6(3)of the cenvat credit rules 2004 to the extent of value of non exciseable goods as it amounts to trading as per the dept. amit jain (Posted On: 24 Feb, 2015)

The revenue department has erroneously raised credit reversal demand as per Rule 6(3) of the Cenvat Credit Rules, 2004 because the activity of ship-breaking amounts to manufacture as per Apex Court decision in the case of Ashish Steel Pvt. Ltd. v. Collector – [1999 (108) E.L.T. A180 (S.C)]. Hence, even if certain non-excisable goods emerge from the activity of manufacture, the same cannot be considered as trading to attract provisions of Rule 6(3) of the CCR, 2004. In this respect, we wish to intimate that with Budget, 2015, Explanation has been added in Rule 6(1) of CCR, 2004 that exempted goods or final products shall include non-excisable goods cleared for a consideration from the factory thereby meaning that w.e.f. 01.03.2015, the provisions of Rule 6 will apply even for non-excisable goods. Accordingly, it may be contended that this provision cannot be made applicable for period before 01.03.2015. {Query replied by CA Neetu Sukhwani}
sir we are engaged in shipbreaking activity in mumbai and during the process of shipbreaking exciseable and non exciseabke goods are sold.we are taking the credit of service tax paid on various services such as mbpt rent, labour contractor, bank charges etc. dept. has issued scn asking us to reverse service tax as per rule 6(3)of the cenvat credit rules 2004 to the extent of value of non exciseable goods as it amounts to trading as per the dept. amit jain (Posted On: 24 Feb, 2015)

The revenue department has erroneously raised credit reversal demand as per Rule 6(3) of the Cenvat Credit Rules, 2004 because the activity of ship-breaking amounts to manufacture as per Apex Court decision in the case of Ashish Steel Pvt. Ltd. v. Collector – [1999 (108) E.L.T. A180 (S.C)]. Hence, even if certain non-excisable goods emerge from the activity of manufacture, the same cannot be considered as trading to attract provisions of Rule 6(3) of the CCR, 2004. In this respect, we wish to intimate that with Budget, 2015, Explanation has been added in Rule 6(1) of CCR, 2004 that exempted goods or final products shall include non-excisable goods cleared for a consideration from the factory thereby meaning that w.e.f. 01.03.2015, the provisions of Rule 6 will apply even for non-excisable goods. Accordingly, it may be contended that this provision cannot be made applicable for period before 01.03.2015. {Query replied by CA Neetu Sukhwani}
RESPECTED SIR As per the Notification of the Government of India in the Ministry of Finance, Department of Revenue No. 21/2014-CE (NT) dated 11.07.2014, vide which, inter alia, amendment was made in Rule 4(1) and 4(7) of CENVAT Credit Rules, 2004 (CCR, 2004) to prescribe that manufacturer or output service provider shall not take CENVAT credit after six months of the date of issue of any of the documents specified in sub-rule (1) of Rule 9. This amendment is effective from 01st September 2014. Based on above, our query is as under - : “Whether the above amendment is applicable for the invoices raised before 1st September 2014.” i.e. if any invoice is dated 30th June 2014, can we take the credit in the month of February 2015?. Vasant Rane (Posted On: 23 Feb, 2015)

You are hereby intimated that with the announcement of Budget, 2015 on 28.02.2015, the time limit for availment of credit has been increased from 6 months to 1 year vide notification no. 6/2015-CE (NT) dated 01.03.2015. Accordingly, as this amendment is applicable from 01.03.2015, assessees can avail cenvat credit of invoices dated 02.03.2014 on 01.03.2015 and so on. Consequently, you may avail the cenvat credit of invoice dated 30.06.2014 latest by 29.06.2015. {Query replied by CA Neetu Sukhwani}
Dear Sir, we are purchasing bearing bush falling under excise teriff 84833000. We are using it to our front axle Assy (i.e. Tractor Parts ). Now my quation is How can avail cenvat credit on thease bearing bush means by considering Capital goods or Input?By defination of Capital goods its comes under Capital but it is used for tractor parts. Yogesh Pawar (Posted On: 21 Feb, 2015)

There is some chapter head which falls particularly in the capital goods. As per definition of capital goods, all goods falls under chapter head 82, 84, 85, 90 and heading No. 68.05 grinding wheels and the like, and parts thereof falling under heading 6804 of the First Schedule to the Excise Tariff Act is capital goods. But if goods fall under these chapter head and consumed as inputs in the manufacture of final product then these goods will be treated as inputs. Bearing bush is using in final product (front axle Assy) as input. You can avail CENVAT credit on these bearing bush considering inputs. {Query replied by: - Monika Tak}
Dear Sir, we are purchasing bearing bush falling under excise teriff 84833000. We are using it to our front axle Assy (i.e. Tractor Parts ). Now my quation is How can avail cenvat credit on thease bearing bush means by considering Capital goods or Input?By defination of Capital goods its comes under Capital but it is used for tractor parts. Yogesh Pawar (Posted On: 21 Feb, 2015)

There is some chapter head which falls particularly in the capital goods. As per definition of capital goods, all goods falls under chapter head 82, 84, 85, 90 and heading No. 68.05 grinding wheels and the like, and parts thereof falling under heading 6804 of the First Schedule to the Excise Tariff Act is capital goods. But if goods fall under these chapter head and consumed as inputs in the manufacture of final product then these goods will be treated as inputs. Bearing bush is using in final product (front axle Assy) as input. You can avail CENVAT credit on these bearing bush considering inputs. {Query replied by: - Monika Tak}
Sir, we have imported one machinery & we got bill from CHA for C&F charges along with service tax. Let me know, can we avail service tax credit against CHA (C&F service)? Can we consider this service as Input service? Yogesh Pawar (Posted On: 21 Feb, 2015)

Assuming that the imported machinery is used by you in manufacture of dutiable excisable goods on which appropriate excise duty is paid or is used in provision of taxable output service, the cenvat credit of service tax charged by CHA for clearing the said machine may be availed by you. {Query replied by CA Neetu Sukhwani}
Sir, we have imported one machinery & we got bill from CHA for C&F charges along with service tax. Let me know, can we avail service tax credit against CHA (C&F service)? Can we consider this service as Input service? Yogesh Pawar (Posted On: 21 Feb, 2015)

Assuming that the imported machinery is used by you in manufacture of dutiable excisable goods on which appropriate excise duty is paid or is used in provision of taxable output service, the cenvat credit of service tax charged by CHA for clearing the said machine may be availed by you. {Query replied by CA Neetu Sukhwani}
dear sir we have manufacturing unit falling under chapter head 29 and 29 here by we used to get A B C raw material from principal manufacturer under 4(5)A Challan for job work along with this A , B,C raw material we adding our cenvatable raw material input "D" on which we have already cenvat credit has been availed Then final product becomes Mixture OF ABCDE shall we eligible to cleared such final product with out charging excise duty against material 4(5)a challans if we could do like that than what about that cenvat we has been already availed please guide us Umesh Bora (Posted On: 19 Feb, 2015)

You can very well clear the job worked goods in terms of Rule 4(5)(a) challan read with notification no. 214/86-CE (NT) without payment of duty provided you comply with the provisions contained in the Rule 4(5)(a) of the Cenvat Credit Rules, 2004 and the notification as stated. Moreover, you may also avail the cenvat credit of the inputs used by you in the manufacture of job-worked goods in light of the decision given by the Hon’ble Bombay High Court in the case of Sterlite Industries [2009 (244) ELT A89 (BOM)], TATA MOTORS LIMITED V. UNION OF INDIA [2009 (244)ELT 337 (BOM.) and Punjab & Haryana High Court decision in the case of Commissioner of Central Excise v/s Happy Forging Ltd [2011 (265) E.L.T. 197 (P & H)]. {Query replied by CA Neetu Sukhwani}
4% additional duty of customs ' 1975 can be utilised for payment of education cess & S.&H Ed. cess. ashok (Posted On: 31 Jan, 2015)

You are intimated that we can utilise the basic excise duty for payment of education cess and SHE cess on the premise that Education Cess and SHE Cess are also duty of excise. Moreover, there is no embargo in Rule 3(7)(b) for utilising the cenvat credit of basic excise duty for payment of education cess and SHE Cess. This view is also confirmed a number of decisions such as CCE, Vapi Vs Balaji Industries [2008(232) E.L.T. 693 (Tri.-Ahmd)], CCE, Shillong Vs Godrej Consumer Products Ltd. [2007 (219) E.L.T. 585 (Tri.-Cal)]. We further submit that the cenvat credit of 4% SAD is available and is utilised for payment of Basic Excise Duty. Following the analogy of the above decisions, when 4% SAD can be utilised for payment of basic excise duty, the same may also be used for payment of Education Cess and SHE Cess. However, there is no clear cut decision on this issue and so this issue is prone to litigation. {Query replied by: CA Neetu Sukhwani}
cenvat credit of 4% additional duty(imports) can be utilised for payment of Education cess & S & H Education cess, inform any notification or supported rules. ASHOK MAKWANA (Posted On: 29 Jan, 2015)

You are intimated that we can utilise the basic excise duty for payment of education cess and SHE cess on the premise that Education Cess and SHE Cess are also duty of excise. Moreover, there is no embargo in Rule 3(7)(b) for utilising the cenvat credit of basic excise duty for payment of education cess and SHE Cess. This view is also confirmed a number of decisions such as CCE, Vapi Vs Balaji Industries [2008(232) E.L.T. 693 (Tri.-Ahmd)], CCE, Shillong Vs Godrej Consumer Products Ltd. [2007 (219) E.L.T. 585 (Tri.-Cal)]. We further submit that the cenvat credit of 4% SAD is available and is utilised for payment of Basic Excise Duty. Following the analogy of the above decisions, when 4% SAD can be utilised for payment of basic excise duty, the same may also be used for payment of Education Cess and SHE Cess. However, there is no clear cut decision on this issue and so this issue is prone to litigation. {Query replied by: CA Neetu Sukhwani}
Sir it is possible same person can run undred central excise registration pvt ltd and another non registered under central excise registration as proprietorship it means one same person can run private limited under excise and another as proprietorship Umesh Bora (Posted On: 29 Jan, 2015)

Respected sir, We are unable to understand your query. As per our understanding you mean that whether one person can take two registrations or not under Central Excise Laws. Yes, a person can take two separate registrations having any constitution as such under excise laws but there must be separate premises for both the registrations. {Query solved by:- Prayushi Jain}
Dear Sir, Suppose x is factory under a public limited company registered under factory act. The company has a canteen where he provides food to employees to their employees at concessional rate.Even employees are getting food at concession rate, they are getting lunch allowance as part of their salary. The company has enter into a contract with a outdoor cater (A Private limited Company) for supply of food by using company canteen and kitchen. The outdoor cater raise bill in the name of the company at the end of the month and charge service tax @12.36% under outdoor catering services. My Question is 1) Can the door cater get service tax exemption under NT No 13/2014 by introduction of Sr No 19A. 2) If the company (Servicer Receiver) is paying the ST then can he eligible for Service tax credit as in put service. Chandra sekhar (Posted On: 27 Jan, 2015)

Respected sir, The carterer shall get exemption under entry serial no. 19A of Notification no. 25/2012-ST inserted vide Notification No. 14/2013-ST only when he follows the following conditions:- 1. The service shall be of providing food or beverages 2. The service shall be provided in a canteen maintained in a factory covered under the Factories Act, 1948. Under Factories Act, if there are 250 employees regularly employed in the factory then it is necessary to maintain a canteen in factory premises. 3. Such canteens have the facility of air conditioning or central air heating at any time during the year. If these conditions aren’t complied with then exemption shall not be available. But he can take abatement of 40% as specified in Rule 2C of Service Tax (Determination of Value) Rules, 2006. This is dispute between department and assessee. Department says that it is clearly excluded from the definition of “input service” in exclusion clause as it is used for personal use of employees. But the assessee can plead that the same is legally required to be provided, hence the credit should be allowed. {Query solved by:- Prayushi Jain}
Dear Sir, Suppose x is factory under a public limited company registered under factory act. The company has a canteen where he provides food to employees to their employees at concessional rate.Even employees are getting food at concession rate, they are getting lunch allowance as part of their salary. The company has enter into a contract with a outdoor cater (A Private limited Company) for supply of food by using company canteen and kitchen. The outdoor cater raise bill in the name of the company at the end of the month and charge service tax @12.36% under outdoor catering services. My Question is 1) Can the door cater get service tax exemption under NT No 13/2014 by introduction of Sr No 19A. 2) If the company (Servicer Receiver) is paying the ST then can he eligible for Service tax credit as in put service. Chandra sekhar (Posted On: 27 Jan, 2015)

Respected sir, The carterer shall get exemption under entry serial no. 19A of Notification no. 25/2012-ST inserted vide Notification No. 14/2013-ST only when he follows the following conditions:- 1. The service shall be of providing food or beverages 2. The service shall be provided in a canteen maintained in a factory covered under the Factories Act, 1948. Under Factories Act, if there are 250 employees regularly employed in the factory then it is necessary to maintain a canteen in factory premises. 3. Such canteens have the facility of air conditioning or central air heating at any time during the year. If these conditions aren’t complied with then exemption shall not be available. But he can take abatement of 40% as specified in Rule 2C of Service Tax (Determination of Value) Rules, 2006. This is dispute between department and assessee. Department says that it is clearly excluded from the definition of “input service” in exclusion clause as it is used for personal use of employees. But the assessee can plead that the same is legally required to be provided, hence the credit should be allowed. {Query solved by:- Prayushi Jain}
Good evening sir, I want to know about construction firm. Is it good for a MBA graduate to start his career in a construction firm? I also want to know that it's experience work or not? Hem Chandra Bhatt (Posted On: 24 Jan, 2015)

We do not deal in carrier consular, we deal in service tax, excise, custom and DGFT law please ask us query on these related field. { Query replied by:- Bijendra Sankhla}
Our employer considers medical reimbursement above Rs.15000.00 as medical perquisites. But recently we came to know a judgment that Hon’ble Mumbai ITAT has in the case of Mr. Rajkamal R. Bajaj c/s ACIT has held that Reimbursement of a medical expense is not perquisite u/s 17(2) of the Act as it is an allowable expenses. My query is that shall we get exemption of medical expenses above Rs. 15000.00 from medical perquisites now based on this judgment? If yes/no, pl explain in detail. tapan (Posted On: 23 Jan, 2015)

We do not deal in Income Tax Laws. Please ask queries related to Excise, Customs, Service Tax or DGFT Laws only. {Query replied by CA Neetu Sukhwani}
Our employer considers medical reimbursement above Rs.15000.00 as medical perquisites. But recently we came to know a judgment that Hon’ble Mumbai ITAT has in the case of Mr. Rajkamal R. Bajaj c/s ACIT has held that Reimbursement of a medical expense is not perquisite u/s 17(2) of the Act as it is an allowable expenses. My query is that shall we get exemption of medical expenses above Rs. 15000.00 from medical perquisites now based on this judgment? If yes/no, pl explain in detail. tapan (Posted On: 23 Jan, 2015)

We do not deal in Income Tax Laws. Please ask queries related to Excise, Customs, Service Tax or DGFT Laws only. {Query replied by CA Neetu Sukhwani}
Sir, pls advice. we do export. after we directly send documents to buyer and buyer remit the payment to our bank. Once we received the payment we submit the copy of document along with fema declaration to bank against this realization .So request you to advice this practice is ok or not Thanks & regards Vinod K B vinodkb (Posted On: 22 Jan, 2015)

Respected sir, This query’s answer shall be in exchange control manual which is issued by RBI. We only deal with queries related to Central Excise, Service Tax and Customs. Hence you are requested to ask queries related to them only. {Query solved by:-Prayushi Jain}
We have got the St registration no in 2012, in FY 2012-2013 Total revenue was Rs 5.00lahh and in FY total revenue was Rs. 6.00 Lakh. The Company don't have file any service tax return for the FY 2012-13 and 2013-14 whether its mandatory to file the service tax return for the above period? Further in FY 2014-2015 Total revenue is Rs 16.00 lakh, kindly tell me whether company is liable to pay service tax on Rs. 16.00lakh or Rs. 6.00 lakh in FY 2014-2015. NAVIN JAIN (Posted On: 22 Jan, 2015)

Yes, service tax return should be filed even if there is no service tax liability as revenue department may impose penalty upto Rs. 20,000/- per return for not filing service tax return under Rule 7C of the Service Tax Rules, 1994. However, it is worth mentioning that the Central Excise Officer has power to reduce or waive the penalty under this Rule if there is sufficient reason for not filing the return. Further, in Financial Year 2014-15, the company is liable to pay service tax on Rs. 6 Lakhs as it is eligible for availing the small scale service provider’s exemption upto Rs. 10 Lakhs as the taxable value of service in the financial year 2013-14 was Rs. 6 Lakhs. {Query replied by: CA Neetu Sukhwani}
Good morning sir, I am Hem Chandra Bhatt from Almora. I want to know about what work done in a construction firm related to tax and excise duty and audit also. Please provide me necessary information. It's my humble request to you. Hem Chandra Bhatt (Posted On: 21 Jan, 2015)

We are unable to understand your query. Please elaborate so that we can help you in our best possible manner. {Query replied by: CA Neetu Sukhwani}
Sir ji, can u please clarify the CENVAT availed under PCM should be taken on turnover base or profit base visuiyer (Posted On: 16 Jan, 2015)

. We are unable to understand your query. Please elaborate the meaning of PCM. { Query replied by:- Bijendra Sankhla}
As we know that interest rate on service tax changed from 01.10.2014 i.e.Up to six months-18%,More than six months and up to one year-18%for first six months and 24%for the period of delay beyond six months.& More than one year-30%. I would like to know that same changes will be apply for excise also or not? Yogesh Pawar (Posted On: 16 Jan, 2015)

We wish to submit that the interest rates changed from 01.10.2014 are meant only for service tax as the amendment has been introduced in section 75 of the Finance Act, vide notification no. 12/2014-Service Tax dated 11.07.2014. The notified interest rates are not applicable to the Excise Act. {Query replied by: CA Neetu Sukhwani}
As we know that interest rate on service tax changed from 01.10.2014 i.e.Up to six months-18%,More than six months and up to one year-18%for first six months and 24%for the period of delay beyond six months.& More than one year-30%. I would like to know that same changes will be apply for excise also or not? Yogesh Pawar (Posted On: 16 Jan, 2015)

We wish to submit that the interest rates changed from 01.10.2014 are meant only for service tax as the amendment has been introduced in section 75 of the Finance Act, vide notification no. 12/2014-Service Tax dated 11.07.2014. The notified interest rates are not applicable to the Excise Act. {Query replied by: CA Neetu Sukhwani}
Respected Sir, We are a manufacturer and undertaking job work for our customers. Raw material and Packing material is provided by party. We processed the finished goods. We have factory at Valsad. Customer has warehouse at Bhiwandi and Additional place of business at Ahmadabad Gujarat. Now my query is that, can we raise invoice on customer at Ahmadabad without any form. Customer will send goods from Ahmadabad to Bhiwandi against F form. Whether this practice is correct.? Vasant Rane (Posted On: 15 Jan, 2015)

We do not deal in VAT Laws. Please ask queries related to Excise, Customs, Service Tax or DGFT Laws only. {Query replied by CA Neetu Sukhwani}
dear sir, 1) Need to show reimbursement in st -3, even if shown in separate column when invoice raised to party and does not collect service tax on it . 2) If A LTD is GTA and B LTD is forwarder and C LTD is final customer , and B LTD paid to A LTD transportation expenses on behalf of C and reimbursed from C LTD in this case who will pay service tax B LTD OR C LTD. uday (Posted On: 12 Jan, 2015)

As regards the first query is concerned, we submit that the fact whether the reimbursement of expenditure is required to be reflected in the return or not depends on whether the expenditure was incurred as pure agent or not. If the expenditure was incurred as pure agent and it forms part of the gross amount charged, then the same is required to be separately reflected in the ST-3 return. However, it is also worth noting that recently Delhi High Court in the case of Intercontinental Consultants and Technocrats Pvt. Ltd. has quashed Rule 5(1) of Service Tax Determination of Value Rules, 2006 thereby concluding that no service tax is payable on the reimbursement of expenses. As such, reflecting the same in ST-3 return would not be an issue. As regards the second query, C Ltd. will be required to pay service tax under reverse charge mechanism because as per Notification no. 30/2012-ST dated 20.06.2012, service tax is payable by the person who pays or is liable to pay freight by himself or through agent for transportation of goods. However, B Ltd. will be required to prove that the amount of freight was paid in the capacity of agent. {Query replied by: CA Neetu Sukhwani}
In case of fire in the factory and in the fire raw material got burn , Whether cenvat credit taken on raw material is to be reversed In case of fire in the factory and in the fire raw material got burn , Whether cenvat credit taken on raw material is to be reversed As per decision in Lord Chloro Alkali v.CCE(2013)293 ELT 68 (CESTAT) Nimish Karwa (Posted On: 12 Jan, 2015)

Yes, the cenvat credit of raw material burnt in the factory due to fire is required to be reversed on the logic that the said raw material was never used and will never be used in manufacture of final products. Accordingly, the destruction of raw material will be considered as “As such removal” and credit will be required to be reversed on the same. The above reply is for the situation when the raw material were destroyed before their issuance to the stores. However, in case it can be proved that the raw material were issued and were contained in WIP, then no credit reversal is required. Also, as per Rule 3(5C) of the Cenvat Credit Rules, 2004, if remission has been granted on finished goods destroyed in fire, cenvat credit taken on inputs used is required to be reversed. {Query replied by: CA Neetu Sukhwani}
What is the procedure of removal of finished goods without payment of excise duty in a warehouse. What is the procedure of removal of finished goods without payment of excise duty in a warehouse. Is Rule 4(4) applicble and if applicable then what is procedure Nimish Karwa (Posted On: 12 Jan, 2015)

Rule 4(1) of the Central Excise Rules. 2002 said that Every person who produces or manufactures any excisable goods, or who stores such goods in a warehouse, shall pay the duty liveable on such goods in the manner provided in rule 8 or under any other law, and no excisable goods, on which any duty is payable, shall be removed without payment of duty from any place, where they are produced or manufactured, or from a warehouse, unless otherwise provided. Rule 4(4) Notwithstanding anything contained in sub-rule(1), Commissioner may, in exceptional circumstances having regard to the nature of the goods and shortage of storage space at the premises of the manufacturer where the goods are made, permit manufacturer to store his goods in any other place outside such premises, without payment of duty subject to such conditions as he may specify.
Sirs, we are manufacturers we have excise registration for for manufacturing activity, now we want to start trading of goods in same premises not related to our inputs. in this case: 1. should we go for new Excise registration? 2. is it enough to intimate our Excise range officers about trading? Pls. provide your valuable advices. BR// Benarjee G Goods Trading (Posted On: 12 Jan, 2015)

You should take new excise registration only if you wish to pass on the cenvat credit to the buyers in the capacity of registered dealer. Further, in case you want to get dealer registration, you will require separate premise for registration because the premises already available with you is registered for manufacturing activities. Further, if trading is being done of goods manufactured by you then the fact of trading is required to be mandatorily intimated in the department. Also, if the trading activity is done by you in the same premises without taking dealer registration, the same will invoke the provisions of Rule 6 of the Cenvat Credit Rules, 2004. {Query replied by CA Neetu Sukhwani}
sir pl helpme, y query is i am work with builders/developers and in which section he take registraion in service tax and rate to be charged and main query if i taken abatement rate 3.07% than i taken cenvet credi on input/capital goods services or not yours rahul RAHUL (Posted On: 08 Jan, 2015)

Section 69 read with Rule 4 of Service tax rules 1994, states that every person liable to pay service tax must mandatorily make an application in ST-1 in two copies for registration to the designated Superintendent of Central Excise. Serial No. 12 of Notification No. 26/2012 ST dated 20.06.2012 as amended vide notification 9/2013 ST dated 08/05/2013 provide that Cenvat credit on inputs used for providing the taxable service has not been taken under the provision of the Cenvat Credit Rules 2004. In the view of above provision you are not eligible to take Cenvat credit on inputs in this case. But credit on input service and capital goods can be taken.(Query replied by BRIJENDRA SANKHLA)
Dear sir, my father was death and I was received an income tax notice for heigh value transaction in saving account of my father. income tax officer said to show record and I don't have any record. Please suggest me what can I do? Siddharth jain (Posted On: 07 Jan, 2015)

We do not deal in Income tax law. Please ask queries related to excise , custom and service tax laws. (Query replied by BRIJENDRA SANKHLA)
What is the procedure of removal of finished goods without payment of excise duty in a warehouse. Is Rule 4(4) applicble and if applicable then what is procedure Nimish Karwa (Posted On: 05 Jan, 2015)

Rule 4(1) of the Central Excise Rules. 2002 said that Every person who produces or manufactures any excisable goods, or who stores such goods in a warehouse, shall pay the duty liveable on such goods in the manner provided in rule 8 or under any other law, and no excisable goods, on which any duty is payable, shall be removed without payment of duty from any place, where they are produced or manufactured, or from a warehouse, unless otherwise provided. Rule 4(4) Notwithstanding anything contained in sub-rule(1), Commissioner may, in exceptional circumstances having regard to the nature of the goods and shortage of storage space at the premises of the manufacturer where the goods are made, permit manufacturer to store his goods in any other place outside such premises, without payment of duty subject to such conditions as he may specify.
In case of fire in the factory and in the fire raw material got burn , Whether cenvat credit taken on raw material is to be reversed As per decision in Lord Chloro Alkali v.CCE(2013)293 ELT 68 (CESTAT) Nimish Karwa (Posted On: 05 Jan, 2015)

Remission of duty is allowed on finished goods but not on inputs. If credit has been taken then this should be reversed because this raw material is not used in the manufacture of final product. As per decision in Lord Chloro Alkali v.CCE(2013)293 ELT 68 (CESTAT), credit in respect of raw material/packing materials which were not put to use or were not even issued for use are required to be reversed. {Query replied by:- Monika Tak}
What is the procedure of removal of finished goods without payment of excise duty in a warehouse. Is Rule 4(4) applicble and if applicable then what is procedure Nimish Karwa (Posted On: 05 Jan, 2015)

Rule 4(1) of the Central Excise Rules. 2002 said that Every person who produces or manufactures any excisable goods, or who stores such goods in a warehouse, shall pay the duty liveable on such goods in the manner provided in rule 8 or under any other law, and no excisable goods, on which any duty is payable, shall be removed without payment of duty from any place, where they are produced or manufactured, or from a warehouse, unless otherwise provided. Rule 4(4) Notwithstanding anything contained in sub-rule(1), Commissioner may, in exceptional circumstances having regard to the nature of the goods and shortage of storage space at the premises of the manufacturer where the goods are made, permit manufacturer to store his goods in any other place outside such premises, without payment of duty subject to such conditions as he may specify.
Whether VAT Input can be taken on the materials used for construction of service station by the Motorcycle dealer (under Karnataka VAT Act) srinath (Posted On: 30 Dec, 2014)

We do not deal in VAT Laws. We deal in Excise, Customs, and Service Tax laws. Therefore kindly ask the query related to those laws only. {Query solved by:- Prayushi Jain}
sir, if STPI unit (India) providing service by to branch/ subsidiary company outside india USA treated as export of service. futher please clarify that service tax export rule 6A rules 1994 applicable on STPI unit or not kindly clarify on urgent basis. Ramlakhan Sharma (Posted On: 27 Dec, 2014)

Respected sir, As per Rule 6A of Export of Service Rules, 2005 a service shall not be considered as export of service if it is provided to its establishment only. As here services are being provided to subsidiary/ branch only therefore this shall not be treated as export of service. {Query replied by:-Prayushi jain}
sir ji.. can u please claraify salary paid to expat is service taxable.. because the salary paid is only for local expenses. the full salary is paid by parent company located outside India. Moreover, the salary paid is not as per the norms fixed by the Passport office; but debited in the books as salary. Department demanding tax; but it is salary and defended by assessee.. We are now at confuse visuiyer (Posted On: 25 Dec, 2014)

Respected sir, Your query that salary paid to expat is taxable isn’t clear. Kindly elaborate the same in light of exact services provided and the payments made. On looking your query we can only say that as it is salary is not chargeable to tax. Therefore please elaborate the same for an appropriate reply. {Query solved by:- Prayushi Jain}
Sir It is known that EMD/Security Deposit forfeited for non performance of the contract is liable for Service Tax.What about Penalty or collection of penal interest from the contractor for non performance of the contract by him.Whether service tax to be levied and collected on such Penalty or penal interest levied on the contractor? Chandrasekar (Posted On: 24 Dec, 2014)

In respect of your query we submit that as per clause (e) of section 66 E ‘Agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act’ is a declared service. Therefore the EMD/Security deposit forfeited for non performance of the contract is liable to service tax. The interest and penalty collected from the contractor under contractor terms shall also be liable to tax as they are as good as fine paid for tolerance of act. Had the penalty and interest been levied under a particular statute or law than they would not have been chargeable to tax because they were not paid for the cancellation of contract but because of applicability of statute. { Query replied by:- Prayushi Jain}
Dear Sir, We have claimed for excise refund claim which we have exported through a merchant exporter. The merchant exported sent Copy of B/L in which they have hide the the name and address of the overseas buyer. But now the central excise officials raise objection for this. Is it is necessary to disclose the name of buyer in the B/L for Excise refund claim. sharda industries (Posted On: 24 Dec, 2014)

The law requires that the self attested copy of Bill of lading should be submitted along with the original and Duplicate ARE-1 duly certified by custom authorities as well as self attested xerox copy of shipping Bill. The self attested copy of Bill of lading means that all the things should be visible. Hence the contention of the department seems right. However, If B/L doesn’t contain the name of overseas buyer and department is also denying the refund on the ground that B/L doesn’t contain the name of overseas buyer then you may provide additional document to the officers such as Mate receipt, Bank realization certificate to show that ther is no dispute that goods have actually been exported. Hence, the procedural infraction should not come in a way to disallow the rebate claim. { Query replied by:- Manish Bhati}
Sir, i want to know the classification of pumping of ready mix concrete under which service. rajneesh kumar (Posted On: 24 Dec, 2014)

We are unable to understand your query properly. For best understanding of your query we need to know the proper nature of the activity undertaken by you. The Ready mix concrete (popularly known as RCM) is chargeable to Excise Duty. As per a latest Supreme Court decision having citation 2015-TIOL-05-SC-ST-LB the supply of ready mix concrete is not a service now. Therefore if the service provided by you is of supply of ready mix concrete than it shall not be taxable. For the proper reply to your query please elaborate the nature of activity undertaken by you {query solved by:- Prayushi Jain}
Dear Sir, I have a query regarding excise duty the parent company duty differs from dealer company .Plz give answer to my query VENKATESH (Posted On: 23 Dec, 2014)

We are not able to understand your query. We request you to be more specific and clear about the same. { Query replied by: Prayushi jain}
How one can utilize service tax collected on rent income? one can settled service tax paid against telephone bill and others. shephali shah (Posted On: 23 Dec, 2014)

Your query isn’t clear. As per our understanding your query is that can you take credit of the service tax paid on telephone bills and others for payment of service tax on rent. The credit is admissible if the telephone services and others have been used for the purpose of providing rent services. If these services have been used for any other purpose than the credit shall be admissible as per the provisions of Rule 6. { Query replied by:-Prayushi jain}
Dear Sir, We are manufacturing company. After RCM notification 01-07-2012, from 01-07-2012 to 31-03-2013, our company has not deposited service tax on 75 % labor bill as per RCM notification. Please note, our company have paid service tax @ 12.36% on 100 % labor bill to our labor contractor and he has already deposited service tax @ 12.36% on 100 % labor bill instead of 25% labor bill. Please also note that our company has not taken credit of that service tax against its central excise payment on manufactured goods . Now Excise auditor has issued memo to our company to pay service tax on 75% labor bill along with interest and penalty. Sir, please inform us, should we pay that demand? If yes, then how our company / labor contract get refund from service tax department? If no, please provide us judgment / appeal order / notification on this. Thank you. Pradip Shah Pradip (Posted On: 20 Dec, 2014)

Service provider cannot pay tax when service receiver is liable, but if paid, service receiver cannot be compelled to pay the service tax again. If service provider (security agency service) had collected tax from service receiver and has paid the same then service receiver need not pay service tax again under reverse charge mechanism because it will be amounts to double taxation. This view has been held in the case of Navyug Alloys Pvt. Ltd. VS CCE & CUS, Vadodara-II [2009 (13) S.T.R. 421 (Tri.-Ahmd.)] wherein it was concluded that once tax has been paid by the provider of service, the service tax cannot be confirmed in respect of the same services against the service recipient on the ground that the liability to pay service tax was on the service recipient. The same view was upheld in the case of Angiplast Pvt. Ltd Vs Commissioner of Service Tax, Ahmedabad [2013 (32) S.T.R. 628 (Tri.-Ahm)]. { Query replied by:- manish bhati}
Dear Sir, We are manufacturing company. After RCM notification 01-07-2012, from 01-07-2012 to 31-03-2013, our company has not deposited service tax on 75 % labor bill as per RCM notification. Please note, our company have paid service tax @ 12.36% on 100 % labor bill to our labor contractor and he has already deposited service tax @ 12.36% on 100 % labor bill instead of 25% labor bill. Please also note that our company has not taken credit of that service tax against its central excise payment on manufactured goods . Now Excise auditor has issued memo to our company to pay service tax on 75% labor bill along with interest and penalty. Sir, please inform us, should we pay that demand? If yes, then how our company / labor contract get refund from service tax department? If no, please provide us judgment / appeal order / notification on this. Thank you. Pradip Shah Pradip (Posted On: 20 Dec, 2014)

Service provider cannot pay tax when service receiver is liable, but if paid, service receiver cannot be compelled to pay the service tax again. If service provider (security agency service) had collected tax from service receiver and has paid the same then service receiver need not pay service tax again under reverse charge mechanism because it will be amounts to double taxation. This view has been held in the case of Navyug Alloys Pvt. Ltd. VS CCE & CUS, Vadodara-II [2009 (13) S.T.R. 421 (Tri.-Ahmd.)] wherein it was concluded that once tax has been paid by the provider of service, the service tax cannot be confirmed in respect of the same services against the service recipient on the ground that the liability to pay service tax was on the service recipient. The same view was upheld in the case of Angiplast Pvt. Ltd Vs Commissioner of Service Tax, Ahmedabad [2013 (32) S.T.R. 628 (Tri.-Ahm)]. { Query replied by:- manish bhati}
Dear sir, whether service receiver can insist service provider for service tax registration in case where S.P is providing service for the 1st time & his aggregate value of service provided exceeds the basic limit..... Purushottam Silwal (Posted On: 18 Dec, 2014)

There is no provision relating to service receiver can insist service provider for service tax registration. But service receiver is correctly insisting the service provider for registration. If service receiver is paying service tax then there is no issue with service provider to not to take registration. If service provider will delay for registration, interest for delayed payment and penal provisions will be attracted. As per Service Tax Rule, Every assessee whose aggregate value of service exceeds 9 lakhs is liable to take registration under service tax, but still he can avail exemption if the value of service does not exceed Rs. 10 lakhs per annum. In this case service provider is providing service and his aggregate value is 15 lakhs, hence service provider has to apply for registration under service tax and liable to pay service tax.
Dear sir, in case where service provider is providing service for the first time & his agg value is 15 lakhs but has not registered under service tax. whether service receiver can insist service provider for service tax registration? Purushottam Silwal (Posted On: 18 Dec, 2014)

There is no provision relating to service receiver can insist service provider for service tax registration. But service receiver is correctly insisting the service provider for registration. If service receiver is paying service tax then there is no issue with service provider to not to take registration. If service provider will delay for registration, interest for delayed payment and penal provisions will be attracted. As per Service Tax Rule, Every assessee whose aggregate value of service exceeds 9 lakhs is liable to take registration under service tax, but still he can avail exemption if the value of service does not exceed Rs. 10 lakhs per annum. In this case service provider is providing service and his aggregate value is 15 lakhs, hence service provider has to apply for registration under service tax and liable to pay service tax.
we are into trading as well as providing service of repair and AMC. how to get cenvat credit from service tax paid on varios bill. please advice samee C (Posted On: 18 Dec, 2014)

Trading is termed as "exempted service" under Cenvat credit Rules. If you take the credit on common inputs or input services which are used in taxable as well as exempted services then the provisions of Rule 6 will be attracted. Three options are available with you. Firstly to maintain the separate inventory of input and input services and take credit only on that part which is going into taxable services. Second option is to reverse the cenvat credit @ 6% on value of exempted services. Third option is to follow the procedure of proportionate reversal
our unit was availing ssi exemption 8/2003 as amended and registered in excise in Dec 2013 and started paying excise. Since april 2014 it is paying service tax on rent on factory premises. As its turnover crosses RS. 1.5 cr limit in dec, 2014, whether it can avail cenvat credit of service tax paid on rent from april 2014 to nov. 2014 for payment of excise for the month of dec 2014 SHYAM SUNDER (Posted On: 08 Dec, 2014)

As per the facts, we understand that the unit was within exemption limit till November, 14 and the unit crossed the SSI exemption in December, 14. We submit that the unit cannot utilize the cenvat credit of service tax paid on rent of factory premises from April, 14 to November, 14 because during the said period the final products were exempted and were cleared without payment of duty. However, the unit will be able to utilize the cenvat credit of service tax paid on rent for the month of December, 2014 onwards. {Query replied by CA Neetu Sukhwani}
dear sir, 1)we are clearing and forwarding agent , we doesn't charge service tax on ocean and air freight, so where to show this figure in st 3 return and in which column. 2) and why ocean freight is not chargable to tax which is from india to other countries uday singh negi (Posted On: 08 Dec, 2014)

Ocean freight is not leviable to service tax vide entry no. (p) (iii) of the negative list specified in section 66D of the Finance Act which provides exemption to services by way of transportation of goods by inland waterways. As there is full exemption from levy of service tax on the ocean freight, there is no requirement to reflect the same in the ST-3 return filed by you. {Query replied by CA Neetu Sukhwani}
we are manufacturer, we modify our building. contractor raise the bill only labour charges with service tax . this service is under work contract on not . we are liable to pay the service tax on reverse charge or not. please clear my query with notification. VISHAL PURI (Posted On: 06 Dec, 2014)

Works contract is a composite contract of goods sold along with the service, here as material has been provided by you and the mere labour charges are collected. Therefore, the same will not be covered by the reverse charge mechanism. Service tax @ 12.36 % on labour charges would be payable by service provider.(Query replied by AASHISH BOHRA)
Respected Sir/Madem Firstly i shell be very thankful to you for resolved my query, secondly we are manufacturer we want to export my F.goods as Sample for customer verification on duty paid. we Export the F.goods by Excise Sealing. can we export (by courier) the sample without ARE-1 & without Sealing by Excise. please verify the the notification. we have not found any notification for this procedure. VISHAL PURI (Posted On: 06 Dec, 2014)

The export procedure as laid down in Act says that the goods which are meant to be exported can be exported under the cover of the document named as ARE 1 i.e. application for the removal of goods for export. It is mandatory to issue ARE 1 whether the goods are exported as sample or otherwise. Similarly it can be sent either under department sealing or under self-sealing procedure.(Query replied by AASHISH BOHRA)
I received an information recently through DGFT consultant that the SFIS license will not be issued to hotels managed by foreign brands, DGFT has restricted these benefits to managed hotels recently and many of the hotels have received Demand Notice for the previous license and duty benefits availed in past with 18% interest. Pl confirm that this is right or wrong? NAVIN JAIN (Posted On: 27 Nov, 2014)

ACCORDING to Serve From India Scheme as defined in the Foreign Trade Policy, all Indian service provider who have free foreign exchange of atleast Rs.10 lakh in current financial year shall qualify for duty credit scrip, while for individual service provider the quantum is Rs 5 lakh. Also the service of hotels and restaurants is specifically mentioned in appendix 41 of handbook of procedures. Thus the hotels and restaurant service is covered but the exemption has been given only to Indian service provider, foreign brand and company are not eligible. (Query replied by AASHISH BOHRA)
we have got three premises located under the same Excise Range.....Inputs etc.are received in one unit and cenvat availed..The other two units are exclusively doing job-work for our own purposes out of the inputs etc. supplied from the parent unit..and are same returned to the main unit where after further work are packed and removed/cleared after paying appropriate excise duty. My query is whether we have to register the other two units also withe Excise department or a simple intimation of existence of the other two units doing Job-work exclusively for us is sufficient. mohan sehgal (Posted On: 23 Nov, 2014)

In accordance with rule 9 of the Central Excise Rules, 2002 read with section 6 of Central Excise Act, 1944 and Notifications issued there under, specified category of persons are required to register with jurisdictional Central Excise Officer in the Range office having jurisdiction over his place of business/factory like manufacturer of excisable goods, first stage and second stage dealer, Persons holding private warehouses for storing non-duty paid goods, Persons who obtain excisable goods for availing end-use based exemption notification, Exporter-manufacturers under rebate/bond procedure; and Export Oriented Units, which have interaction with the domestic economy (through DTA sales or procurement of duty free inputs). Although job worker is mentioned here but there is no duty liability on job worker. As the excise duty is payable at parent factory thus an undertaking in NOTIFICATION NO. 214/86 by principal/parent factory should be given to AC/DC of job worker. When there is no liability of job worker then there is no need of registration. (Query replied by AASHISH BOHRA)
Dear Sirs, we are manufacturers we manufacturing excisable products we have excise registration for manufacturing activities my query is: 1. can we trading our inputs without trading registration? Pls. provide your valuable information. Regards, Benarjee G G BENARJEE (Posted On: 23 Nov, 2014)

It is submitted that the decision to take separate registration for trading depends upon the quantum of trading and the fact whether credit is to be passed on to the buyer or not. If the trading of inputs is voluminous, you are advised to take separate registration for trading because the revenue department may invoke the provisions of Rule 6 of Cenvat Credit Rules, 2004 as “trading is exempted service”. However, if there are small transactions of trading of inputs, then the provisions of as such removal of inputs as contained in Rule 3(5) of the Cenvat Credit Rules, 2004 will apply. {Query replied by: CA Neetu Sukhwani}
sir,iam a Tax consultant one of my client got TDS refund ASS YEAR 2010-11 it is Manually applied and returned due to door lock.I again claimed for refund and submitted the concerned Documents to ITO Narsaraopet DIST:GUNTUR(ANDHRAPRADESH)On July-2013.Theyhave told that the concerned Refund will be issued after 45 days.But still now the refund has not issued they are not giving proper reply to me .Plz give a solution to these problem and give sugggestions to complaint to the concerned Authority VENKATESH (Posted On: 18 Nov, 2014)

We do not deal in Income Tax Laws. We only deal in Excise, Customs, Service Tax and DGFT Laws.
Respected Sir, We are manufacturer/Exporter of empty hard gelatin capsules. We export the material by Sea Shipments/Air Shipments. We send the material to Air Port or Nhava Shiva Port by Goods Transport by Road & paid the Service Tax on behalf of Transporter. can we eligible for Service Tax Refund on Transport of Goods. please clarify the above issue with Notification. I shell be very thanks full to you. Regards Vishal Puri Vishal Puri (Posted On: 18 Nov, 2014)

Yes, you may avail the benefit of exemption notification no. 31/2012-ST dated 20.06.2012 by complying with the conditions specified therein like the exporter is required to produce consignment note, by whatever name called, issued in his name and has to file half yearly return in Form EXP-2 within fifteen days of the completion of six months. The notification may be viewed on the cbec website. {Query replied by: CA Neetu Sukhwani}
Dear sir we are manufacturer of corrogated boxes and kraft papers our small vendorse are not registered with central excise then supplied raw material to us for job work with out 4 5 à challan plz let me knw what to do there we should charge central excise on such job work or is there any other way where our vendore cant bear excise burden Umesh Bora (Posted On: 18 Nov, 2014)

As you are undertaking manufacturing activities on job work basis, you are liable to pay excise duty on the manufacture of goods. However, the vendors getting the job work done from you may undertake to pay excise duty on the goods manufactured by you in terms of the provisions of notification no. 214/86-CE dated 25.03.1986 or under Rule 4(5)(a) of the Cenvat Credit Rules, 2004. {Query replied by: CA Neetu Sukhwani}
Dear sir we are manufacturer of corrogated boxes and kraft paper rolls we are confused regarding few poinst such as what would be chapter heading for this products rate of duties is there any particular conditions benefits available for our product plz help me to learn central excise rules regulations etc no our product related Umesh Bora (Posted On: 18 Nov, 2014)

Assuming that you manufacture corrugated paper and paperboard and kraft paper, the chapter heading no. 4808 is applicable to you wherein the rate of excise duty is specified as 6%. As per our knowledge, there is no exemption benefit available for this product. {Query replied by CA Neetu Sukhwani}
Respected Sir, I have filled ST-3, relating of Service Construction of residential complex, The abatement notification no. 26/2012 sr. no. 12(i) filled by me in the abatement section instead of amended notification. Please guide me , what procedure should be adopted by me to rectify the mistakes apparent on the st3 return. Sir what is the notification No. to be filled. Sir, if not corrected than what may be departmental action. Sir your guidance will appreciate to me, Please. CA Nawal Agarwal (Posted On: 15 Nov, 2014)

As per our understanding, you have mentioned serial no. 12 of the notification by mistake instead of mentioning the abatement notification no. in the ST-3 return. You are informed that you may rectify any mistake in the ST-3 return by revising the return filed by you within 90 days from the date of filing the said return. If the time for revising the return has been expired, you may intimate the department through a letter. {Query replied by: CA Neetu Sukhwani}
Wheather export value is to shown in ER1 Return at FOB VALUE OR at CIF VALUE Nimish Karwa (Posted On: 15 Nov, 2014)

The value of export clearances to be shown in the ER-1 return is the sale price of the exported goods mentioned in the Excise Invoice prepared by you. {Query replied by: CA Neetu Sukhwani}
Wheather captive consumption is necessary to show in the Er1 Return Nimish Karwa (Posted On: 15 Nov, 2014)

Yes, it is necessary to show captive consumption in the ER-1 return because there is exemption from excise duty on products captively consumed if the duty is being paid on the final products. You are required to reflect the details of the product captively consumed under home clearances and mention the exemption notification no. 67/95-C.E. dated 16.03.1995. {Query replied by: CA Neetu Sukhwani}
Wheather captive consumption is necessary to show in the Er1 Return Nimish Karwa (Posted On: 15 Nov, 2014)

Yes, it is necessary to show captive consumption in the ER-1 return because there is exemption from excise duty on products captively consumed if the duty is being paid on the final products. You are required to reflect the details of the product captively consumed under home clearances and mention the exemption notification no. 67/95-C.E. dated 16.03.1995. {Query replied by: CA Neetu Sukhwani}
sir ji.. can u please clarify the subcontract in works contract is exempted from service tax - is it correct.. one of the subcontractor referring to mega notification 25/2012 (highlighting sl. no.20) please update and clarify visuiyer (Posted On: 15 Nov, 2014)

No, every sub-contract under works contract is not exempt. The clause (h) of entry no. 29 of the Mega Exemption notification provides exemption to sub-contractor providing services by way of works contract to another contractor providing works contract services which are exempt. Hence, if the principal work contractor is providing services which are exempt, then only, the sub-contractor will be exempt from payment of service tax under the said works contract. This exemption is not applicable when the principal work contractor is providing taxable services. {Query replied by: CA Neetu Sukhwani}
Sir I had made the payment of service tax in other assesses code by mistake and mean while I had filed ST-3 by showing the same reference no. in the return.so please guide me how to solve this problem sanjay sharma (Posted On: 12 Nov, 2014)

There is no solution to the problem of paying service tax in other assessee’s code by mistake. You are required to pay service tax under the correct assessee code again. However, the unit for which service tax was paid by mistake may adjust the said service tax against its future service tax liability. Further, return is required to be revised within a period of 90 days from the date of filing of return showing the reference of correct challan no. However, if the time to revise the return has been expired, you are require to intimate the department through a letter in this regard. {Query replied by: CA Neetu Sukhwani}
ours is a private limited company and we have purchased a Punjab Team of Champions Tennis League, which will conduct tennis matches. Under which service head , we will be taxable for service tax registration , rate of tax, whether cenvat will be available, whether any service tax to be paid under RCM on prize money to be paid to winning player , also PRIZE MONEY to be paid to Winners: Rs 1 crore Runners-up: Rs 50 lakh , whether RCM to be paid on Franchise fee: $1 million per year. Kindly expalin TDS provisions under income tax act nma (Posted On: 01 Nov, 2014)

Although the facts of the case are not clear but as far as we understood the same would be covered under the sponsorship services and covered under reverse charge mechanism and entire liability to pay service tax will fall on service receiver. (Query replied by AASHISH BOHRA)
DEAR SIR, WE PROVIDE SERVICES LIKE JCB EXCAVATION OF LAND BY HELP OF A JCB MACHINE. AS WE DO NOT USE ANY RAW MATERIAL, WILL THIS SERVICE BE CLASSIFIED AS WCT BECAUSE WE USE CAPITAL GOODS I.E. JCB MACHINE ? SWAPNIL SHAHA (Posted On: 01 Nov, 2014)

works contract is a composite contract while the excavation of land does not involve transfer of goods in the execution of service thus service tax on the same would be payable on normal basis. (Query replied by AASHISH BOHRA)
Dear Sir, Our assesse is a builder and a service receiver for JCB excavation. Whether jcb excavation service received on task basis will be subject to RCM under Works Contract Services ? Aslo, if the jcb excavation services are received on per hour basis, whether they will be considered as machine hire charges and exempt from RCM liability ? SWAPNIL SHAHA (Posted On: 01 Nov, 2014)

works contract is a composite contract while the excavation of land does not involve transfer of goods in the execution of service thus service tax on the same would be payable on normal basis. (Query replied by AASHISH BOHRA)
Adjudication authority(Addl Commisioner) passed an order imposing penalty u/s. 77,78. Commissioner reviewed the order and directed the AC to file appeal. AC filed an APpeal with Commissioner(Appeal) to increase penalty u/s.77 from Rs. 20000/- to 1,21,000 (200/- per day). Assesee appeared before commisioner(Appeal) Not contested such appeal. Order passed in favou of revenue. Assessee filed an appeal before the CESTAT for such increase in penalty u/s.77. my query is whether Assessee may challange order imposing penalty u/s. 78 before CESTAT, which was not challanged in earlier appeal? IF no, can Assessee file writ challanging the order passed by Addl. Commissioner for imposition of Penalty u/s. 78 as a alternate remedy? raghu (Posted On: 01 Nov, 2014)

No, assessee cannot challenge the order imposing the penalty under section 78 before CESTAT because non-filing of appeal before the Commissioner Appeals amounts to acceptance of the order imposing penalty. Assessee cannot file writ petition in the High Court also for imposition of penalty under section 78 because once the assessee has exhausted the appellate remedy by not filing appeal to the Commissioner Appeals, the same order cannot be challenged in the High Court. {Query replied by CA Neetu Sukhwani}
Central Excise Audit have raised a demand on credit availed by us since the invoice on which credit was taken is not properly serialed as required under rule 11(2). Further their is no as such clearence marked as required under rule 3(5). Pl clarify. ALOK SINGHANIA (Posted On: 30 Oct, 2014)

It is settled principle that the cenvat credit cannot be denied for procedural lapses as far as the substantial conditions for availing the said credit is being satisfied. If the invoice on the basis of which credit is being taken contains other essential particulars like Name and address of supplier, Excise registration no., chapter tariff heading of product, excise duty amount etc. and it can be established that the said inputs were used in the manufacture of final products cleared on payment of duty, the credit cannot be denied. There are number of cases wherein it has been concluded that the substantial benefit of credit is not to be denied for technical infractions of law. {Query replied by CA Neetu Sukhwani}
a service tax assessee raised bill as production & processing of finished goods, whether he should charge service tax on the bills or not. Sova Singh (Posted On: 27 Oct, 2014)

If the finished goods on which processing is being done by the service provider is cleared on payment of appropriate excise duty by the principal manufacturer, then no service tax is payable by the service provider on such production and processing. This is supported by entry no. 30 of the Mega Exemption Notification No. 25/2012-ST dated 20.06.2012 which states that there is exemption from service tax on carrying out an intermediate production process as job work in relation to any goods on which appropriate duty is payable by the principal manufacturer. Hence, if excise duty is paid on finished goods, no service tax is to be charged. {Query replied by CA Neetu Sukhwani}
Sir ji.. please clarify on the RCM. we un'stand that RCM is applicable for corporate receiving service from non corporate @ 50%-50% on Works contract. In case of sub-contract to a main contract there is no tax as per notification no.25/2012. In such a case does RCM is applicable or not.. pl. clarify and what is the status of 25/2012 in such cases.. visuiyer (Posted On: 25 Oct, 2014)

As per the notification no. 25/2012, sub- contractor providing services by way of works contract is exempt from payment of service tax provided such services are provided to main contractor who is also providing services of works contract which is exempt from payment of service tax. It is submitted that when the main contractor is not liable to pay service tax, the sub-contractor is also not liable to pay service tax. When there is no service tax leviable, the question of paying service tax under reverse charge mechanism does not arise. {Query replied by CA Neetu Sukhwani & Monika Tak}
Sir ji.. I have a clarification in RCM-WCS. We are a corporate service provider; we have a sub contractor who is non corporate. We understand that RCM is applicable @ 50% on 40% value Now the question is.. the sub contractor is for laying piping work where materials are supplied by us. the rate of contract is per cubic meter. (he uses cement, river etc for holding the pipe) Now clarify please whether it comes under WCS as per Rule 2A (a) (i) of value determination Rules or comes under MRA @ 75% on 100% value; or Commercial or industrial Construction Service pl. clarify visuiyer (Posted On: 21 Oct, 2014)

As stated by you that the materials are being supplied by you to the sub-contractor for laying of pipes. Accordingly, the service cannot be covered under the category of “Works Contract Service” because there is transfer of materials. Consequently, in our opinion, it will be best classifiable under the category of ”Commercial or Industrial Construction Service”. It is worth observing that abatement of 25% is available if no cenvat credit of inputs used is being taken by the service provider. {Query replied by CA Neetu Sukhwani}
wheather service receiver paying service tax under reverse mechanism has to show n.n. 30/2012(reverse charge notification) as a exemption notification in st 3 return Nimish Karwa (Posted On: 17 Oct, 2014)

If we observe legally, in case of partial reverse charge there is no exemption from service tax as such and only the liability to pay service tax is specified. However, in order to depict the percentage of service tax payable, some assessees follow the practice to mention notification no. 30/2012 under the category of exemption notification in the return. It is not necessary to mention the notification but for the sake of clarity, it is specified. In case of full reverse charge, as 100% liability to pay service tax is on the service recipient, this notification is not mentioned in the exemption notification category. {Query replied by: CA Neetu Sukhwani}
Dear Sir, if the assessee not constested the case before the commissioner appeal and accepts the order passed by the commissioner appeal in service tax case. What are the remedies(steps) available to him? whether he can move to HC against such order. or he constest the icnreased penalty in CESTAT? Raghavender Upadhyay (Posted On: 16 Oct, 2014)

We are unable to understand your query. It is assumed that the assessee has accepted the order of the Commissioner Appeal but on appeal by revenue in CESTAT, penalty was increased and it is against this increased penalty that you are asking the appellate remedy. Yes, you may appeal to High Court against the order of CESTAT increasing the penalty. {Query replied by: CA Neetu Sukhwani}
Our Company has Purchased Raw material from a party. We have taken Cenvat Credit on Input. We have also taken Service tax credit on freight paid to GTA service. Now, our company has rejected the Raw material & returned the same to the vendor. Consequently, we have Reversed the Credit taken on Input. My query is : In such situation, Should we Reverse the Service tax credit taken on freight paid by us? niranjan sharma (Posted On: 16 Oct, 2014)

There is no need to reverse the credit taken on the freight paid by you for purchasing the raw material from party which was subsequently returned. The reason for the same being that you have taken credit of excise duty paid on raw material in the capacity of inputs but the credit of service tax paid is being taken in the capacity of input service availed in relation to manufacture of final products. The defination of input service is wide and so the credit can be availed of the services availed by the assessee. Cenvat Credit Rules also say about the reversal of credit on inputs only. Even the Punjab and Haryana High Court has also opined on the same lines in this matter. {Query replied by: CA Neetu Sukhwani}
In case of reverse charge mechanism wheather it is necessary to select N.N 30/2012 (REVERSE CHARGE NOTIFICATION )IN EXEMPTION COLUMN IN ST 3 return Nimish Karwa (Posted On: 16 Oct, 2014)

If we observe legally, in case of partial reverse charge there is no exemption from service tax as such and only the liability to pay service tax is specified. However, in order to depict the percentage of service tax payable, some assessees follow the practice to mention notification no. 30/2012 under the category of exemption notification in the return. It is not necessary to mention the notification but for the sake of clarity, it is specified. In case of full reverse charge, as 100% liability to pay service tax is on the service recipient, this notification is not mentioned in the exemption notification category. {Query replied by: CA Neetu Sukhwani}
Respected Sir, We have manufacturing unit and also provide & receive of services for manufacturing & non manufacturing department so, we want to utilise service tax credit for payment of excise duty.In what ratio we take the credit. please mention the formula or otherwise take full credit of service tax for payment of excise duty. Regards, Deepak Deepak Dalvi (Posted On: 15 Oct, 2014)

We submit that if certain services are received for manufacturing activities and trading activities, then the provision of Rule 6 of the Cenvat Credit Rules, 2004 are attracted. In such a case, you may follow any of the following 3 options:- 1. Maintain separate records for input/input services used in manufacturing activities and trading activities and take credit of input/input services used in manufacturing activities. 2. Proportionate reversal of credit as per prescribed formula. 3. Pay 6% of the value of exempted service. {Query replied by: CA Neetu Sukhwani}
Respected sir, I have query related to a rent a cab service: Condition 1: Service Provider: Individual and registered under service tax. Service Receiver: Company Service tax liability: for receiver & provider Condition 2: Service Provider: Individual and not registered under service tax. Service Receiver: Company Service tax liability: for receiver & provider 3. Is Service Tax charged in the bill by service provider, a. if yes then how much. b. If not , then service tax liabilty to pay as a service receiver is 40%, which is paid to govt. by challan. then what about 60%. how to show in the return. whether to take abatement or exemption.please also mention the notification for this. Regards, Deepak Deepak Dalvi (Posted On: 15 Oct, 2014)

For rent a cab service, there is abatement notification which prescribes that only 40% of the taxable value is leviable to service tax provided no cenvat credit is taken. However, the provision of reverse charge mechanism is applicable if rent a cab service is provided by individual/HUF/partnership firm to business entity registered as body corporate. Further, in case the benefit of abatement notification is availed, the liability to pay service tax to the government is on service recipient under full reverse charge. However, if the benefit of notification is not availed by the service provider, then 50% liability is to be paid by service provider and 50% by the service recipient. Before budget 2014-15, it was 60% for service provider and 40% for service recipient. Reverse charge is applicable irrespective of the fact whether the service provider is registered or not if the required conditions are satisfied. If the service tax is charged by the service provider, it means that it is partial reverse charge when no abatement is being claimed. In such a case, service tax is payable on entire value and in the return, we will mention only the notification no. 30/2012-ST dated 20.06.2012 which specifies the percentage of tax payable by service provider and service receiver in the exemption notifications. The purpose of mentioning notification no. 30/2012-ST is to clarify the percentage of service tax payable. If 100% service tax is paid by the service receiver, then abatement is also availed. Consequently, service tax is paid on 40% of the value and notification no. 30/2012-ST dated 20.06.2012 will not be mentioned because 100% service tax is paid by receiver. {Query replied by:- CA Neetu Sukhwani}
Dear sir, we are manufacturer of motor vehicle parts, and we are also doing packing amount to manufacturing under Sec-4A, my doubt is, Shall I avail cenvat credit for GTA inward and outword? Regards Subramani.P Subramani.P (Posted On: 15 Oct, 2014)

There is no issue as regards availment of credit for GTA inward under MRP based valuation. However, the cenvat credit for GTA outward is admissible only if the 3 conditions are satisfied as per Board Circular no. 97/8/2007-ST dated 23.08.2007 and also confirmed in the case of Gujarat Ambuja Cements Ltd. Vs Union of India [2009 (14) S.T.R. 3 (P & H)]. The 3 conditions are :- 1. Sales is on FOR Basis. 2. Risk and ownership is with buyer till delivery of goods at customer’s doorstep 3. Freight amount is integral part of the assessable value of goods. It is also worth observing that recently, Delhi Tribunal has held in the case of M/s Ultratech Cement Ltd. Vs CCE, Rohtak [2014-TIOL-1934-CESTAT-DEL] that credit of outward freight is admissible even if assessment is not made under section 4 (transaction value basis). Hence, outward freight credit is admissible even if assessment is made on specific rate of duty/on basis of tariff values etc. provided the 3 conditions are satisfied. There is also recent Allahabad High Court decision on this issue having citation as M/s Kohinoor Biscuits Products Vs CCE [ 2014-TIOL-1804-HC-All-CX] which allowed the credit on outward freight even though the manufacturer is paying duty under MRP based valuation. {Query replied by:- CA Neetu Sukhwani}
thank you sir. Can you provide RATE of ABATEMENT on JAM & JELLIES along with notification no. ibrahim (Posted On: 11 Oct, 2014)

As explained in our earlier reply, there is no abatement on Jam and Jellies. You have the option to pay 2% excise duty if no cenvat credit of inputs or input services is being availed under notification no. 01/2011-CE dated 01.03.2011. However, if you want to avail cenvat credit, you have to pay 6% excise duty. {Query replied by CA Neetu Sukhwani}
Respected Sir, I am little confused in rent a cab service under RCM: if a. Service provider is individual but not registered in service tax. and service receiver is company and registered under ST. so my query is what is tax liability to pay service tax to service receiver & provider, under rent a cab service. whether avail the benifit of abatement or exemption. and who avail.please specify the notification no. b. Service Provider is Individual registered under service tax and service receiver is company and register under ST. so what is the tax liability to pay service tax to service receiver & provider. whether avail the benifit of abatement or exemption. and who avail. c. invoice structure from service provider - if Service Provider charge ST in bill then at what rate, in both the above conditions note: 1. we receive a bill from service provider who is registered with service tax & charge ST @ 4.944% in the invoice.whether is this correct. other condition is 2. we receive a bill from service provider who is not registered in Service Tax & not charging ST in his bill. then as a service receiver what is my ST liability is 40% or full 100%. Regards, Deepak Deepak Dalvi (Posted On: 11 Oct, 2014)

For rent a cab service, there is abatement notification which prescribes that only 40% of the taxable value is leviable to service tax provided no cenvat credit is taken. However, the provision of reverse charge mechanism is applicable if rent a cab service is provided by individual/HUF/partnership firm to business entity registered as body corporate. Further, in case the benefit of abatement notification is availed, the liability to pay service tax to the government is on service recipient under full reverse charge. However, if the benefit of notification is not availed by the service provider, then 50% liability is to be paid by service provider and 50% by the service recipient. Before budget 2014-15, it was 60% for service provider and 40% for service recipient. Reverse charge is applicable irrespective of the fact whether the service provider is registered or not if the required conditions are satisfied. If reverse charge is not applicable, then the service provider may charge at the rate of 4.944% if he claims abatement and does not take cenvat credit otherwise he may also charge at the rate of 12.36% if cenvat credit is availed by him. {Query replied by CA Neetu Sukhwani & Monika Tak}
Respected Sir, I am little confused in rent a cab service under RCM: if a. Service provider is individual but not registered in service tax. and service receiver is company and registered under ST. so my query is what is tax liability to pay service tax to service receiver & provider, under rent a cab service. whether avail the benifit of abatement or exemption. and who avail.please specify the notification no. b. Service Provider is Individual registered under service tax and service receiver is company and register under ST. so what is the tax liability to pay service tax to service receiver & provider. whether avail the benifit of abatement or exemption. and who avail. c. invoice structure from service provider - if Service Provider charge ST in bill then at what rate, in both the above conditions note: 1. we receive a bill from service provider who is registered with service tax & charge ST @ 4.944% in the invoice.whether is this correct. other condition is 2. we receive a bill from service provider who is not registered in Service Tax & not charging ST in his bill. then as a service receiver what is my ST liability is 40% or full 100%. Regards, Deepak Deepak Dalvi (Posted On: 11 Oct, 2014)

For rent a cab service, there is abatement notification which prescribes that only 40% of the taxable value is leviable to service tax provided no cenvat credit is taken. However, the provision of reverse charge mechanism is applicable if rent a cab service is provided by individual/HUF/partnership firm to business entity registered as body corporate. Further, in case the benefit of abatement notification is availed, the liability to pay service tax to the government is on service recipient under full reverse charge. However, if the benefit of notification is not availed by the service provider, then 50% liability is to be paid by service provider and 50% by the service recipient. Before budget 2014-15, it was 60% for service provider and 40% for service recipient. Reverse charge is applicable irrespective of the fact whether the service provider is registered or not if the required conditions are satisfied. If reverse charge is not applicable, then the service provider may charge at the rate of 4.944% if he claims abatement and does not take cenvat credit otherwise he may also charge at the rate of 12.36% if cenvat credit is availed by him. {Query replied by CA Neetu Sukhwani & Monika Tak}
what is abatement on Jam & Jellies under chapter heading 20. kindly provide notification number ibrahim (Posted On: 10 Oct, 2014)

In our opinion, the product Jam & Jellies fall under chapter sub-heading 2007 in the Central Excise Tariff Act, 1985 specifying excise duty at the rate of 6% with cenvat credit facility. However, as per notification no. 01/2011-CE dated 01.03.2011, the rate of excise duty is 2% if no cenvat credit of inputs or input services is being availed. {Query replied by CA Neetu Sukhwani}
Sir, I have ST Registration no. with Single Category, but i made payment with various categories. Now I want to file return with all that category which is not registered with department, still can i able to file the ST-3 return for Apr to Sept 14 for those category which is registered. Nidhi Bhoir (Posted On: 09 Oct, 2014)

Yes, you can still file the ST-3 return under various categories even if you have not amended your registration certificate because there is facility of adding various category of services and it is not linked with the services of which registration is being taken. However, it is advised to amend the service tax registration soon. {Query replied by CA Neetu Sukhwani}
Sir, I have ST Registration no. with Single Category, but i made payment with various categories. Now I want to file return with all that category which is not registered with department, still can i able to file the ST-3 return for Apr to Sept 14 for those category which is registered. Nidhi Bhoir (Posted On: 09 Oct, 2014)

Yes, you can still file the ST-3 return under various categories even if you have not amended your registration certificate because there is facility of adding various category of services and it is not linked with the services of which registration is being taken. However, it is advised to amend the service tax registration soon. {Query replied by CA Neetu Sukhwani}
Sir ji. can u pl clarify whether cenvat input is available in service tax for import of materials. visuiyer (Posted On: 08 Oct, 2014)

What we have understood that a service provider is importing certain goods and we have been asked the admissibility of service tax credit of service tax paid on input services used in relation to such imported goods. We submit that cenvat credit would be admissible only if the said services and the import of goods are related to provision of taxable service by the service provider. {Query replied by CA Neetu Sukhwani}
if wrong accounting service tax code is entered how to rectify this service tax code Nimish Karwa (Posted On: 07 Oct, 2014)

There is no provision to rectify the mistake in mentioning the wrong accounting code. However, Board has clarified in ST Circular No. 58/7/2003 dated 20.05.2003 that if assessee has paid service tax under wrong accounting code, then the assessee may not be asked to pay the service tax again in the correct accounting code because in such cases, the assessee is any way entitled to refund of the amount of service tax paid under wrong accounting head. As such, you may write a letter and intimate in the department that service tax has been wrongly paid under another accounting code and also specify the correct accounting code. {Query replied by CA Neetu Sukhwani}
Whether Remuneration Paid to a Director also attracts Service Tax under the Reverse Charge mechanism? M. SUNDARA MOORTHI (Posted On: 05 Oct, 2014)

No. Remuneration paid to directors is not leviable to service tax because the relationship of directors with the company is that of employer and employee relation which is specifically excluded from the definition of service under section 65B (44) of the Finance Act, 1994. However, the revenue department is raising service tax demands on the remuneration paid to directors. In order to prove that there is employer employee relationship of director with the company, Form 16A and Income Tax return filed by the director may be submitted as evidence. {Query replied by CA Neetu Sukhwani}
Hello Sir/Ma'am Thanks for have a look for our query. My query is What is the manufacturer exemption limit in central excise after 2014 budget. Kalpana Singh (Posted On: 03 Oct, 2014)

We hope that you are asking for SSI exemption limit under notification number 8/2003-CE dated 1.3.2003 and as amended. It stood at same level of Rs. 1.5 crore as earlier. There is no change from this budget.
sir can builder can take the cenvat credit Mahendra P Sharma (Posted On: 01 Oct, 2014)

Yes the builder can take the cenvat credit on input service and capital goods but he cannot take the credit on inputs as per notification number 26/2012-ST dated 20.06.2012 and as amended.
dear sir, under which notification number i can avail abatement for gta return p.subramaniam (Posted On: 29 Sep, 2014)

Serial number 7 of Notification number 26/2012- ST dated 20.06.2012 and as amended.
we are manufacturer of motor vehicle parts and we are sending job work for excise registered vendor as well as non-excise vendor. We are paying boring duty for non excise vendor, and not for excise vendor since he is paying boring duty. Is it right or else pls give advise. Subramani.P (Posted On: 29 Sep, 2014)

We understand that boring duty means duty on scrap generated during boring. The liability to pay duty on scrap is on job worker as it is generated at his premises. There are number of CESTAT decisions on the same. But the department does not agree on the same.
Dear sir, Whether input service tax credit shall be available for business promotion which is raging in hotel in construction service. Thanks and regards Amit Gupta Amit Gupta (Posted On: 29 Sep, 2014)

We are not able to understand your query fully i.e whether you are running hotel or construction industry. However,the credit on sales promotion is available under definition of "input service". But the concept of sales promotion is to be viewed in light of Gujarat High Court decision in case of Cadila Healthcare.
In works contract service, one builder has made invoice such away that vat value charged on Basic+Service tax Value. Is it correct? i think it will create cascading effect i.e. tax on tax. Please suggest in works contract service it is correct or not? Yogesh Pawar (Posted On: 28 Sep, 2014)

We are not dealing in VAT and hence are not able to comment on the same.
Sir, we are the manufacturer of chemical products. we have received work contract service through contractor, our contractor wish to pay 100% service tax instead of 50% is their any provision to allow the provider to pay 100% service tax and receiver 0%. shafeeq (Posted On: 26 Sep, 2014)

If the service is works contract (material and labour) and not only labour charges then the service provider is other than body corporate and service recipient is body corporate then the reverse charge mechanism is applicable. In that case, 50% is to be paid by service provider and 50% service recipient. Otherwise 100% is payable by service provider.Since all the details are not provided to us, we are not able to comment on the same.
Sir, we are the manufacturer of chemical products. we have received work contract service through contractor, our contractor wish to pay 100% service tax instead of 50% is their any provision to allow the provider to pay 100% service tax and receiver 0%. shafeeq (Posted On: 26 Sep, 2014)
Sir, we are manufacturer having excise registration and service tax registration. we wanted to registered for service ISD. (INPUT SERVICE DITRIBUTER). for the same should we take new S.Tax Registration for ISD or amend our old S.Tax Registration. if we should take new registration pls. provide notification no. Thanks & Reg PSB P.S.Butola (Posted On: 26 Sep, 2014)

These two can be taken in the same registration. Please amend your registration online and submit to the department.
Sir, we are exporter in garments sector. We used to pay GTA and we are availing ST refund through shipping bill for export @0.18%. Pls advice based on the notification 25/2012 can we stop paying GTA vinodkb (Posted On: 26 Sep, 2014)

Yes, you can stop paying service tax on outward GTA for export and claim exemption under notification number 31/2012. You should file declaration EXP-1 and file six monthly return regularly in EXP-2 with the department.
Respected Sir, Can we take service tax cenvat credit of RCM in service tax or excise. (in all services which are covered in RCM) a. if partial ST paid to party charge in the bill after making bill payment b. or partial paid directly to govt. by way of challan amt. thanx regards Deepak Deepak Dalvi (Posted On: 26 Sep, 2014)

Yes you can take the cenvat credit of service tax paid under RCM provided it is allowed as per provisions of Cenvat Credit Rules. You can avail both the credit of service tax charged in bill as well as on the basis of challan deposited by you only after payment of service tax as well as bill amount to the service provider
sir ji. pl clarify on the payment of service tax by individual on receipt basis (for turnover less than 50 lacs) this 50 lacs turnover is before abatement or after abatement (ie. taxable turnover or total turnover) visuiyer (Posted On: 25 Sep, 2014)

The language used in the fourth proviso to Rule 6(1) of the Service Tax Rules, 1994 is “in case of individuals and partnership firms whose aggregate value of taxable services provided from one or more premises is fifty lakh rupees or less in the previous financial year…”. Although the interpretation should be that value of services after abatement should be considered because of use of word “taxable services”. However, the revenue department will not accept and will dispute the same. But, we may place reliance on the decisions given in the case of ASHOK KUMAR MISHRA VERSUS COMMISSIONER OF C. EX., ALLAHABAD [2013 (32) S.T.R. 300 (Tri. - Del.)]and SURINDER KUMAR MITTAL VERSUS COMMISSIONER OF C. EX., CHANDIGARH [2013 (31) S.T.R. 12 (Tri. - Del.)]wherein it was held that for SSI exemption, aggregate value of taxable services means value after abatement. {Query replied by CA Neetu Sukhwani}
we have file the Exp-2 for freight paid to transporters from factory to port and transpoter is not issuing consignment note each containers. transporter only raising bill monthly basis. in this regard service department asking us to provide consignment note otherwise exemption benifit will not be allowed. kindly advise your valuable opinion in the regard. Ramlakhan Sharma (Posted On: 24 Sep, 2014)

The contention of the department is right as you have to file the consignment note along with the EXP-2 return. However, in our view, exemption should not be denied on the basis of this technical issue.
we understand that Ocean fereight for export is exempted but excise auditors ask us notification in this regard. kindly provide us your valuable opinon. Ramlakhan Sharma (Posted On: 24 Sep, 2014)

Ocean freight is exempted vide clause (p) of section 66D of the Negative List wherein services by way of transportation of goods by an aircraft or a vessel from a place outside India upto the customs station of clearance in India or by Inland waterways is exempted. {Query replied by CA Neetu Sukhwani}
Sir ji.. can u please advise excess payment made to service tax can be adjusted in the next financial year visuiyer (Posted On: 22 Sep, 2014)

There are provision in Rule 6 (1A) , 6(3) and 6(4A)which allows adjustment of extra service tax. You can view these provisions and act according to applicable provision.
is cenvat available for service tax paid on rent... visuiyer (Posted On: 16 Sep, 2014)

A manufacturer or producer of final products or a provider of taxable service shall be allowed to take credit of any input service received by the manufacturer of final product or by the provider of output services. The general test to consider a service to be input service would be to see whether the service is used for rendering of any output service. Thus if the rent is paid on renting of some movable or immovable property which is used by us in providing output service or producing output, only then rent paid shall qualify as input service and its credit can be taken. {Query replied by:- Ranu Dhoot}
Form EXP 2 (half yearly return ) is online or it is manual . EXP 2 FORM FOR NOT PAYING SERVICE TAX ON REVERSE MECHANISM ON FREIGHT PAYMENT FROM FACTORY TO PORT IN CASE OF EXPORT Nimish (Posted On: 16 Sep, 2014)

Form EXP 2 has to be filed manually. {Query replied by:- Ranu Dhoot}
we are the import dealers i want to know on which value the Vat has to be calculated 1. Whether on Basic Value or 2. Basic + Duty since the CVD and Additional Duty is passed on customer 1. Whether on Basic Value or 2. Basic + Duty pradeep (Posted On: 16 Sep, 2014)

The VAT shall be levied as per VAT Laws. We do not deal in VAT matters. Hence we will not be able to reply. We deal in Central Excise, customs, DGFT and service tax. {Query replied by: Ranu Dhoot}
Sir, Would like to know whether penalty is imposable on jobwork goods not received back by the principal manufacturer within 180 days. Brij Mohan (Posted On: 15 Sep, 2014)

If the goods sent on job work are not returned to the principal manufacturer within 180 days, the principal manufacturer is required to reverse the credit which was availed by them at the buying off such good. There is no penalty leviable as such in such case, however if department issues SCN on this issue it may demand general penalty under Rule 27 of Central Excise Rules, 2002. {Query replied by:- Ranu Dhoot}
Dear Sir, one of my client in the business of mustered de oil cake. he usually sell goods against h form. the delivery place is mostly kandla from jaipur. i want to know that whether exemtion on freight on service tax for oil cake in mega exemption is also available on mustered de oil cake. and also inform or mail me other service tax releted clause in export business. CA. Ram Bajaj (Posted On: 15 Sep, 2014)

Vide Serial. No. 21 item (e) of Mega Exemption Notification No. 25/2012-ST, transportation services provided by Goods Transport Agency (GTA) for transporting chemical fertilizer, organic manure, oil cakes and cotton (ginned or baled). Thus, service tax charged on freight shall stand exempted on all kinds of oil cakes including on mustard oil cakes too. {Query replied by :- Ranu Dhoot}
Dear Sir, Service recipient and Service provider both are in taxable area , because we are providing services through Service receiver to the customers residing the J&K, hence our service is intermediately services. On the basis of this fact we are liable to pay service Tax on the services in the aforesaid mentioned services. On the other hand if we treat this service as an exempted service so, we are not liable to take the credit of the inputs proportionately used in providing the exempted services. After taking this into consideration I request you that please share your opinion as to whether there is any ST liability on us? Kamalesh Sanghani (Posted On: 11 Sep, 2014)

We are unable to understand your query. Please elaborate in detail.
Suppose, I have received an order of X value. The contract is FOR. We despatched the final product by paying excise duty at the time of despatch. Now my question is with related to service tax credit. Situation 1- I have no separate contract for transportation cost. I am paying service tax on transportation service under RCM . shall I eligible for cenvat credit ? Situation -2 If there is a separate line for transportation in contract then - shall I raise extra excise invoice for excess amount received from buyer then actual expenses ? Shall I eligible for service tax credit for service tax paid under RCM ? Please reply with appropriate provision in law and put some case law in support.... Quick reply is highly appreciable..... - Chandra sekhar (Posted On: 10 Sep, 2014)

The credit of service tax paid on outward freight is available, subject to satisfaction of following conditions as laid down in CBEC circular number C.B.E. & C. Circular No. 97/6/2007-S.T., dated 23-8-2007:- i) the ownership of goods and the property in the goods remained with the seller of the goods till the delivery of the goods in acceptable condition to the purchaser at his door step; ii) the seller bore the risk of loss or damage to the goods during transit to the destination; and iii) the freight charges were an integral part of the price of goods. Thus, if your arrangement is such that the freight is part of the assessable value and excise duty is being paid on the assessable value inclusive of freight and the other two conditions are being satisfied, then you shall be eligible for Cenvat credit of service tax paid on outward freight. This is supported by decision of Karnataka High Court in the case of CCE , Bangalore Vs ABB Limited [2011 (23) STR 97 (Kar)] as well as P & H High Court in the case of Ambuja Cements Ltd. Vs UOI [2009 (236) E.L.T. 431 (P&H)] . However, this stand has been changed by Calcutta High Court in recent case of CCE Vs Vesuvious India Ltd. [2014 (34) S.T.R. 26 (Cal)]. {Query replied by: CA Neetu Sukhwani & Ranu Dhoot}
Respected Sir, I have query related to Rent a Cab Service 1. we received a monthly bill from bus service provider for pick up & drop facility from company to station and he is charging 40% of 12.36% ST in the bill. is this correct? or we paid 40% Directly to Govt. under RCM. 2.how to show in the return as a service receiver or not to show in the return. a. if pay to service provider b. if pay to Govt. 3. what about 60% of service tax part. Thanx & regards Deepak Deepak Dalvi (Posted On: 10 Sep, 2014)

For rent a cab service, there is abatement notification which prescribes that only 40% of the taxable value is leviable to service tax provided no cenvat credit is taken. However, the provision of reverse charge mechanism is applicable if rent a cab service is provided by individual/HUF/partnership firm to business entity registered as body corporate. Further, in case the benefit of abatement notification is availed, the liability to pay service tax to the government is on service recipient under full reverse charge. However, if the benefit of notification is not availed by the service provider, then 50% liability is to be paid by service provider and 50% by the service recipient. Before budget 2014-15, it was 60% for service provider and 40% for service recipient. Now, assuming that you are a business entity registered as body corporate and you have received services of rent a cab from individual/HUF /partnership firm, the service tax liability will be 100% on you if the benefit of abatement is availed. Consequently, the practice of service provider charging 40% of 12.36% ST in the bill is wrong. The revenue department may raise service tax demand on your company as if the benefit of abatement is availed, service recipient is liable to pay 100% service tax. If the service tax is paid to the service provider, then it will not have mention in ST-3 return because the credit of service tax paid is not admissible in case of rent a cab service. Moreover, it will lead to double taxation as department will insist you to pay service tax under reverse charge. If you pay service tax under reverse charge mechanism, the same will be reflected in the ST-3 return filed by you in the capacity of service receiver. {Query replied by:- CA Neetu Sukhwani & Ranu Dhoot}
Respected Sir, We are engaged in Real Estate Business.We have commercial building where we provide car parking spaces to the public visited to our various offices. On such car parking we charged some amount on hrs basis. Whether this amount is taxable or not under Service Tax? If there is notification or Case law which cleared the same. nidhi bhoir (Posted On: 09 Sep, 2014)

The Services by way of vehicle parking to general public excluding leasing of space to an entity for providing such parking facility were initially exempted vide Serial No. 24 of Mega Exemption Notification. However, vide Notification No. 3/2013 dated 1st March 2013 {w.e.f. 1.4.2013} the serial number 24 of Mega exemption Notification stood omitted. Thus at present, service tax needs to be charged on amount collected as parking charges. {Query replied by:- Ranu Dhoot}
We are a Ltd. company, we have a depot at different location to supply the goods to nearby distributors. Company sends the goods to depot and depot supply goods to Distributor. I want to know that whether er are require service tax registration for each separate depot as the depot pay freight for delivery the goods and service tax under GTA on sch freight. BUt all payments are made form HO only. Thanks & regards Mahendra Modi MAHENDRA MODI (Posted On: 05 Sep, 2014)

Yes, separate service tax registration for each depot is required to be taken for discharging service tax liability under reverse charge mechanism under the category of “GTA service” as far as centralised registration is not taken. {Query replied by:- Ranu Dhoot}
Hi I am new in imports and want to the actual duty on pet bottles HS code is 39159042. Sanjeev Ahluwalia (Posted On: 04 Sep, 2014)

The customs duty mentioned in the Customs Tariff Act, 1975 is 10% for HS Code 39159042. However, notification no. 12/2012-Customs dated 17.03.2012 provides exemption to the products of chapter 3915 vide serial no. 236 wherein the rate of customs duty is 7.5%. The CVD rate for the product is 12%. However, the product is being exempted from the levy of SAD vide notification no. 21/2012-Cus dated 17.03.2012. Therefore, the effective rate of customs duty is 21.012% (inclusive of cess). {Query replied by CA Neetu Sukhwani}
We have applied for UT-1 in the month of July and we received the UT-1 acceptance letter in the month of August. Please confirm what will be the expiry date of UT-1 ajay mundra (Posted On: 02 Sep, 2014)

An LUT shall be valid for 12 calendar months from the date of acceptance provided the exporter complies with the conditions of the LUT, especially the procedure for acceptance of proof of export. Thus, LUT in your case shall be valid upto August of next year. {Query replied by:- Ranu Dhoot}
Dear Sir, We have input services in the nature of Car Hire i.e Car hired via Tab cab, meru cab,etc. On the bill no Service tax amount is mentioned nor Service tax number is mentioned.As Service receiver being a company, are we liable to make payment under Reverse Charge mechanism after availing abatement of 60%(Renting of motor car)? Or we are not liable for any service tax payment? Payal Chauhan (Posted On: 27 Aug, 2014)

As per section 66D (o)(vi) “Metered cabs, radio taxis or auto rickshaws” were exempt from levy of service tax. However, with the Budget 2014-15, the exemption with respect to radio taxis has been withdrawn from a date to be notified, after the Finance Bill receives the assent of the President. The Finance Bill, 2014 received the assent of President on 6th August, 2014 and no date has been notified for levy of service tax on radio cabs till date. It is worth mentioning that the abatement available to rent a cab service would also be available to radio taxi service. As your query is for the service tax liability for the prior period, the same is governed by the negative list and is exempted from payment of service tax. {Query replied by:- CA Neetu Sukhwani & Ranu Dhoot}
Respected sir, our partnership firm.one transport supply truck on hire which fright one time is 55000/- at one time .transporter having pan,service tax no.please clearify TDS position vasudeo patil (Posted On: 26 Aug, 2014)

We do not deal in TDS matters. Hence we will not be able to reply. We deal in Central Excise, customs, DGFT and service tax. (Query replied by: Ranu Dhoot}
Sir, We are under taking contracts for supply and erection & commissioning of Plant and Machinery in Maharashtra as well as Out of Maharashtra state , we do not enter into works contract and the orders are taken for supply and erection & commissioning separately in this case f form for erection & commissioning is require to be taken under cst act from oms customer ? is there any notification and case law .please guide us and send the notification & case law details my mail address at the earliest ( pravinshelke55@gmail.com) with best Regard's Pravin Shelke PRAVIN SHELKE (Posted On: 26 Aug, 2014)

We do not deal in CST matters. Hence we will not be able to reply. We deal in Central Excise, customs, DGFT and service tax. {Query replied by: Ranu Dhoot}
Sir production of RMC under job-work arrangement at site of construction with total material supplied by Builder EXCISE DUTY is exempt.What is the liability of JOB worker under Service Tax krishna goel (Posted On: 25 Aug, 2014)

As per clause (f) of section 66D pertaining to negative list, “Any process amounting to manufacture or production of goods” is exempt from the levy of service tax. It is submitted that as the job work of production of RMC amounts to manufacture in terms of Central Excise Act, 1944, the same is exempt from the levy of service tax. Therefore, there is no service tax liability of the job worker. {Query replied by:- CA Neetu Sukhwani & Ranu Dhoot}
If cancel of an order with an overseas supplier for a component. Now the buyer liable to pay some compensation for cost incurred by our supplier. When Buyer remit foreign currency to such overseas supplier, shall the buyer need to consider the applicability of Service tax under reverse charge mechanism? I request you to share your views about the applicability of service tax with appropiate case law and provision of the law.... Chandra sekhar (Posted On: 25 Aug, 2014)

ANS. The above mentioned transaction is of sale of property and does not in any way belong to provision of service, hence no service tax is applicable on this transaction. Since the transaction in question is incidental to sale of property, no service tax is leviable on the same. {Query replied by:- Ranu Dhoot}
"Sir, Our firm is in US staffing services provided to US clients and receive payment in Foriegn currency in Indian Account and at the same time receive commission from foreign universities in Foreign currency. My query is Whether we have to apply IEC code? Applicability of Service Tax on Both the receipts? Raghavender Upadhyay As regards applicability of service tax on the services of staffing provided to US clients and commission received from foreign universities in foreign currency is concerned, the said services are covered by Rule 9 of the Place of Provision of Service would apply, that says that in case of the intermediary services, the place of provision of service would be the location of the service provider. As in the present case, the location of the service provider is in India, being the taxable territory, service tax would be leviable on the commission received. However, for a service to be export, it is essential that the following conditions are satisfied, i.e., the service provider is in taxable territory, service recipient is in non-taxable territory, consideration is received in foreign convertible currency and the place of provision of service is outside India. However, as the place of provision of service is in India, the above transaction cannot be considered as export as per Rule 6A of the Service Tax Rules, 1994. It is submitted that only exporter or importer is required to take IEC code. As explained, that the transaction is not covered under export so the firm is not exporter and cannot take IEC code. {Query replied by CA Neetu Sukhwani & Hushen Ganodwala}" In reply to your answer i herewith submit that our client is providing services on behalf of US Staffing Company. US company raising the invoices to clients and receiving payments for Staffing work. Client Company is receiving their share from US staffing company in US dollars? my point is whether the services provided to US staffing company is covered under Rule 9 of place of provisions of service and intermediary services? Raghavender Upadhyay (Posted On: 23 Aug, 2014)

We have already explained in our earlier reply to your query that in case of intermediary service, the place of provision of service would be the place of service provider as per Rule 9 and so in the present case, in India and hence, the service would be leviable to service tax. Further, there is no requirement to obtain IEC code. The answer to your counter query is that the Education guide released by CBEC explains the meaning of “intermediary services” as generally, an “intermediary” is a person who arranges or facilitates a supply of goods, or a provision of service, or both, between two persons, without material alteration or further processing. Thus, an intermediary is involved with two supplies at any one time: i) the supply between the principal and the third party; and ii) the supply of his own service (agency service) to his principal, for which a fee or commission is usually charged. The above cited case is covered by situation no. (ii) wherein client is providing services on behalf of US staffing company. Therefore, the situation would be covered by meaning of intermediary service and so consequently would be governed by the provisions of Rule 9 of the POPS Rules. {Query replied by: CA Neetu Sukhwani & Hushen Ganodwala}
Dear Sir, We are manufacturer of Copper Flat & Rod. We Import Raw materials like Copper Cathode & Scrap. We release raw materials with payment of customduty or under advance licence. We want to know if we use FMS or FPS or VKYU for making of Custom duty, for VAT received are creditable or not ? Mayur Rami (Posted On: 23 Aug, 2014)

We are unable to understand your query. Please elaborate in detail. {Query replied by:- Ranu Dhoot}
An audit objection raised to our company as Non Payment of Service Tax on Director's Remuneration under reverse charge as with effect from 01.07.2012 vide notification no. 30/2012-Service Tax Dated 20-06-2012 as amended by notification No. 45/2012-Service Tax Dated 07-08.2012 has inserted Clause (A) at Serial 5 of the table to Notification. My query is our director is whole time director. is service tax applicable? Ajay Bansal (Posted On: 22 Aug, 2014)

Reply: - Service is not leviable when there is a employer-employee relationship between the director and company. Generally Whole time director is treated as employee of the company since there is contract of service hence we are not liable to pay service tax on the same under reverse charge mechanism. The department is not accepting this contention hence litigation is going on this issue. {Query replied by:-Manish Bhati}
Due to wrong advice....We applied for Central Excise Registration even though we are only job-work manufacturer..working/processing on inputs/semi-finished goods supplied by another manufacturer who is finally clearing the goods on payment of appropriate excise duty...Now we wish to surrender the registration certificate..what is the procedure to be followed for surrendering the certificate.... mohan sehgal (Posted On: 20 Aug, 2014)

ANS. Vide Notification No.35/2001-Central Excise(N. T.) dated 26th June, 2001, Every registered person, who ceases to carry on the operation for which he is registered, shall de-register himself by making a declaration in the form specified in Annexure-III and depositing his registration certificate with the Superintendent of Central Excise. {Query replied by:- Ranu Dhoot}
Sir, We are a society regd under the TN society registration act and we are 100% funded by the CG. If we provide a sponsorship service to a) Non- body corporate b)Foreign Company, are we liable to pay service tax??? Vinod Rajan (Posted On: 20 Aug, 2014)

As per notification no. 30/2012 service tax is payable by recipient of service only when sponsorship service is provided to body corporate or partnership firm, no matter who provides the service. But in the above mentioned case services are provided to non body corporate or foreign company, thus the service tax shall be paid by service provider and not the service receiver in this case. {Query replied by:- Ranu Dhoot}
Dear sir we are registered under central excise and we have received material for job work under 83/94 , 84/94 and 214/86 challans please guide us where we should charge excise duty and service tax plz cooperate Umesh Bora (Posted On: 13 Aug, 2014)

We submit that if the process undertaken by you under job work amounts to manufacture, then no excise duty is required to be paid under the job worked goods because for job-work done under notification no. 214/86, principal manufacturer is liable to pay excise duty on the final products cleared by him after using the job-worked goods. Moreover, notification no. 83/94 and 84/94 also provides exemption from the levy of excise duty on the specified goods manufactured by job worker with the difference that the principal manufacturer avails the benefit of small scale exemption notification. Therefore, no excise duty is required to be charged on the goods manufactured on job work basis under the said notifications. As regards levy of service tax is concerned, if the job work process does not amounts to manufacture but the intermediate process that is undertaken by the job worker is ultimately used in the manufacture of final products on which duty is paid, then such processes are exempted from levy of service tax by virtue of clause (f) of section 66D of the Finance Act pertaining to negative list. Hence, neither excise duty nor service tax is chargeable on the goods that are being processed on job work basis and are ultimately used in manufacture of final products cleared on payment of duty. {Query replied by: CA Neetu Sukhwani}
DEAR SIR OUR OF THE CLIENT AVAILING DUTY DRAWN BACK AS WELL AS REBATE CLAIM PLEASE LET ME KNOWN IT CORRECT HE FALLING UNDER CHAPTER HEADING 73 AND IT WOULD BE BETTER IF YOU SHOW FROM WHERE AND HOW TO FIND REBATE AND DUTY DRAWBACK AVAILABILITY TO DIFFERENT CHN Umesh Bora (Posted On: 13 Aug, 2014)

ANS. There are two type of rebate claims under Rule 18. One is input stage rebate and second is finished good stage rebate. Also there are two type of rates in drawback. One is with Cenvat credit and other is without cenvat credit. If we claim input stage rebate then only lower drawback rate with cenvat credit can be claimed. But if we claim finished goods stage rebate then complete drawback can be claimed. But this will depend on the fact whether we have availed cenvat credit on input and input service. If the same is availed then drawback with cenvat credit can be claimed. All information regarding Duty Drawback can be found in Duty Drawback Rules and rates are available on CBEC website in custom section. The information regarding rebate claim can be found in Notification No. 19/2004-Central Excise (N.T.) dated 6th September 2004 read with Rule 18 of Central Excise Rules. {Query replied by:- Ranu Dhoot}
DEAR SIR WE ARE REGISTERED UNDER CENTRAL EXCISE FROM LAST 25 YEAR FROM THAT DAY WE JUST CLEARED OUR EXPORTS UNDER LUT ONLY HENCE THE HUG CENVAT CREDIT BALANCE LYING AT RG23A PART II NOW WE MANAGEMENT HAS DECIDED TO SURRENDER CENTRAL EXCISE SO PLEASE GUIDE ME HOW WE SHOULD GET REFUND OF THIS BALANCE CREDIT IS THERE ANY PROVISION TO GET CASH FROM GOVERNMENT ( FEW GOV OFFICERS TOLD US TO APPLY RULE 10A BUT WE DONT HAVE OTHER UNIT TO TRANSFER CENVAT CREDIT SO PLEASE LET US KNOWN PROCEDURE TO GET CASH REFUND FROM CENTRAL EXCISE DEPARTMENT Umesh Bora (Posted On: 13 Aug, 2014)

The only way to claim refund of accumulated credit balance arising due to exports made under Letter of undertaking is by resorting to the provisions of Rule 5 of the Cenvat Credit Rules, 2004 read with notification no. 27/2012-CE (NT) dated 18.06.2012. However, the refund claim filed by you may be rejected as time barred because the department contends that the refund is to be filed within a period of one year from the date of let export order as per the provisions of section 11B of the Central Excise Act, 1944. But, there are decisions of High Court of Gujrat that there is no time limit to file refund under Rule 5 of the Cenvat Credit Rules, 2004. Accordingly, as the matter is controversial, you may file the refund claim under Rule 5 of the Cenvat Credit Rules, 2004 by placing reliance on the decision given by the Gujarat High Court in the case of CCE Vs Swagat Synthetics [2008 (232) E.L.T. 413 (Guj)]. {Query replied: CA Neetu Sukhwani}
Dear Sir, A Pvt Ltd Co. as an event manager receiving service for Rent-a-Cab from Proprietor firm. Under Reverse Charge Mechanism we are paying Service Tax on abated value i.e.40% on Bill amount (40% means 100%) . Now As per Union Budget 2014-15 Service Tax Notification No.08/2014 Service Tax i.e.w.e.f 1st Oct 2014 In the said Notification at 1. (iii) b-(ii) Cenvat Credit on input service of renting of motorcar has been taken under the provision of the Cenvat Credit Rule 2004 in the following manner:- Full Cenvat Credit of such input service received from a person who is paying service tax on forty percent of the value. Or Up to fourty percent Cenvat Credit of such input service received from a person who is paying service tax on full value. Can we take Cenvat Credit for Rent-a-Cab Service w.e.f 1st Oct 2014. Please confirm. Pratap Seth (Posted On: 12 Aug, 2014)

The benefit of Notification no. 08/2014 is available only to service provider who provides the service of renting of motor cab. The expression “motorcab” means any motor vehicle constructed or adapted to carry not more than six passengers excluding the driver for hire or reward. If motor cab service provider avails the benefit of abatement then only 40% cenvat credit, of input service of renting of motorcab received from a person paying service tax on 100% of value i.e. without claiming abatement, shall be allowed or 100% input service of renting of motor cab shall be allowed if input service of renting of motor cab received from a person paying service tax on 40 % of value i.e. after claiming abatement. Ultimately if rent a cab(only motorcab) service provider avails abatement then only 40% credit shall be allowed. As you are paying service tax under reverse charge mechanism, cenvat credit in respect of renting of any motor vehicle (be it motor cab or other than motor cab) will not be allowed since definition of Input service exclusively excludes the same. {Query replied by:-Manish Bhati}
Dear Sir, I had sent u a query of rate of excise duty on cetsh no.68042220 according to the budget 10-07-2014 as it was before 12.36% now after 10-07-2014 is it 12.36% or else.Please reply. hitesh (Posted On: 12 Aug, 2014)

The tariff head 68042220 pertains to “grinding wheels of other materials”. The excise duty specified in the Central Excise Tariff Act, 1985 continues to be 12.36% on the same. {Query replied by: Ranu Dhoot}
Sir, We are the manufacturer of Pig Iron from Iron Ore (Non Excisable) and Coke (Excisable) as the principal raw material. Prior to April-12, we are disclosing Iron Ore & Coke in ER-6. But then onwards we drop Iron Ore as no excise duty is there. In a query letter to Range we had clarified that ER-6 talks about "inputs" & ER-4 talks about "raw material". Therefore in ER-4 we are disclosing both Iron Ore & Coke. But still department issue SCN? Sir, Please resolve our following queries? 1. Whether our practice is as per law? 2. On what ground we should prepare our reply to the SCN? RAJIV JAIN (Posted On: 11 Aug, 2014)

Ans.: In ER-6, we have to disclose the Major Input which is used for manufacture of final product. If Iron Ore is used more than 10% for making of Pig Iron, in that case we should disclose the same in return. It is immaterial whether it is dutiable or not. Hence, your practice is not as per law if it is major input. Secondly, you should write simply in your reply that we have not disclosed the same in ER-6 return as it is not dutiable and hence our intentions are not malafide. {Query replied by:- Hushen Ganodwala}
Sir, Our firm is in US staffing services provided to US clients and receive payment in Foriegn currency in Indian Account and at the same time receive commission from foreign universities in Foreign currency. My query is Whether we have to apply IEC code? Applicability of Service Tax on Both the receipts? Raghavender Upadhyay (Posted On: 08 Aug, 2014)

As regards applicability of service tax on the services of staffing provided to US clients and commission received from foreign universities in foreign currency is concerned, the said services are covered by Rule 9 of the Place of Provision of Service would apply, that says that in case of the intermediary services, the place of provision of service would be the location of the service provider. As in the present case, the location of the service provider is in India, being the taxable territory, service tax would be leviable on the commission received. However, for a service to be export, it is essential that the following conditions are satisfied, i.e., the service provider is in taxable territory, service recipient is in non-taxable territory, consideration is received in foreign convertible currency and the place of provision of service is outside India. However, as the place of provision of service is in India, the above transaction cannot be considered as export as per Rule 6A of the Service Tax Rules, 1994. It is submitted that only exporter or importer is required to take IEC code. As explained, that the transaction is not covered under export so the firm is not exporter and cannot take IEC code. {Query replied by CA Neetu Sukhwani & Hushen Ganodwala}
We wish to change our premises for removal of finished goods,due to space problems,to a better spacious premises..both the units have been registered with the central excise deptt.Can we transfer the finished goods to the new premises on a Challan after paying full excise duty..we do not want to raise a invoice because we want to have a continuity for vat purposes...whether excise duty paid on a transfer challan to oen unit is acceptable for taking credit of the excise duty paid in the other unit.. mohan sehgal (Posted On: 05 Aug, 2014)

Ans.: In case of Intra-transfer of finished goods from one unit to other unit, there are following possibility and consequences: (a) if you plan to transfer the FG to your other unit, than you have to pay excise duty from your existence plan & no cenvat credit is available to your another unit because lack of manufacturing activity. (b) But if you transfer the semi-finished goods to your other unit for the further manufacturing activity, in such situation, you can take the cenvat credit. The point should be noted that you cannot transfer FG from one unit to another without making any invoice. Preparation of invoice is mandatory. In the above (a) situation, if you want to transfer FG to other unit then you should need to get registration of “Dealer” under Central Excise so that other unit can transfer Cenvat proportionately on the basis of invoice of one unit.
Dear sir one of my client providing services to BMC relates to solid waste management which observed from tender copy submitted initially to BMC, can we take the benefit of exemption notification no-25/2012 ILIAS PATHAN (Posted On: 04 Aug, 2014)

In absence of agreement/tender copy, we are unable to examine the eligibility of exemption to you. However, in the mega exemption notification, serial no. 38 provides exemption to services by way of public conveniences such as provision of facilities of bathroom, washrooms etc. and not to services of management of waste. As such, prima facie, you are not eligible to avail the exemption of the said entry. {Query replied by: CA Neetu Sukhwani & Ranu Dhoot}
D/Sir, One of my client is manufacturing of small paper roll(fax roll) vide ce tariff 49019900 and paying central excise duty 6% with availing facility of cenvat so please advise that duty and tariff is ok for the same. Kindly give your valuable advise ............... Thanks & Regrads, Kalpana Singh advocate kalpana Singh (Posted On: 29 Jul, 2014)

The thermal paper for fax machines falls under the tariff head 48119093 and the amount of duty levied on it is 12%. Alternatively, it can also be classified under chapter 4802 6950 that pertains to Automatic data processing machine paper that is leviable to duty at the rate of 6%. Your view of taking it under tariff head 49019900 is incorrect as this tariff head is meant for printed books, brochures, leaflets and alike items. Query replied by:- Ranu Dhoot
for a job worker whether his job work rate/assessible rate is considered to calculate exemption limit of 150Lacs krishna goel (Posted On: 29 Jul, 2014)

It is assumed that the job worker is not liable to pay excise duty in terms of notification no. 214/86. As per the SSI exemption notification no. 08/2003-CE dt. 1st March, 2003, it has been mentioned that clearances which are exempt from the whole of the excise duty leviable thereon (other than an exemption based on quantity or value of clearances) under any other notification or on which no excise duty is payable for any other reason, shall not be taken into account while determining the aggregate value of Rs. 1.5 crore. Further, the Notification no. 214/86 exempts the job worker from paying excise duty on job work done by them as the principal manufacturer undertakes to pay the duty on clearance of final products. Hence, job work rate/assessable rate shall not be considered while determining the exemption limit of Rs. 1.5 crore. However, if you are not availing benefit of notification no 214/86 and paying duty on final product then the provision of Section 10A of Valuation Rules will come into play and job worker has to pay duty on sale price of principal manufacturer. In determining the value of aggregate value of clearances of Rs. 150 Lakhs, the clause 5(c) of notification defines the term "value". It says that the value shall be determined under Section 4 or Section 4A or tariff value fixed under Section3. Hence, the value will be transaction value only and not job charges. {Query replied by Manish Bhati}
Whether Finished Goods fully manufactured and accounted in 'Daily Stock Account' can be taken back on shop floor for remade / repair purpose. How to remove such goods from RG-1 stock. Is there any provision in Rule 10 Cen Ex. Rules 2002 Sudhakar Sawant (Posted On: 28 Jul, 2014)

Yes, finished Goods fully manufactured and accounted in 'Daily STOCK Account' can be taken back on shop floor for remade / repair purpose. You’ll be required to show such finished goods in the column of “Issued for other purposes” in the Daily stock Account. {Query replied by: Ranu Dhoot}
how to transfer finished goods stock from one regd.premises to another own regd.premises under central excise mohan sehgal (Posted On: 22 Jul, 2014)

The transfer of finished goods stock from one registered premises to another own registered premises is possible only on payment of central excise duty by the transferring premises. One more precaution that is required to be taken is that if the unit to whom the finished goods are being transferred is a factory registered under the Central Excise Laws and the said unit also manufactures the same goods, then the transferee unit is required to take permission from the Central Excise Authorities for trading such finished goods. {Query replied by: CA Neetu Sukhwani & Ranu Dhoot}
Respected Sir. I am working in Pvt. Ltd. Company. Our Security Service Agency has paid Full Service Tax. Now, Excise Department raised demand of 75% Service Tax under REVERSE CHARGE MECHANISAM it has to be demanded. Pl. Provide me JUDGMENT DETAILS or CASE LAW regarding this matter. PLEASE. IT'S VERY URGENT. Pratik A Patel (Posted On: 22 Jul, 2014)

Service provider cannot pay tax when service receiver is liable, but if paid, service receiver cannot be compelled to pay the service tax again. If service provider (security agency service) had collected tax from service receiver and has paid the same then service receiver need not to pay service tax again under reverse charge mechanism because it will amount to double taxation. This view has been held in the case of Navyug Alloys Pvt. Ltd. VS CCE & CUS, Vadodara-II [2009 (13) S.T.R. 421 (Tri.-Ahmd.)] wherein it was concluded that once tax has been paid by the provider of service, the service tax cannot be confirmed in respect of the same services against the service recipient on the ground that the liability to pay service tax was on the service recipient. The same view was upheld in the case of Angiplast Pvt. Ltd Vs Commissioner of Service Tax, Ahmedabad [2013 (32) S.T.R. 628 (Tri.-Ahm)]. {Query replied by CA Neetu Sukhwani & Manish Bhati}
We have got three different premises registerd under central excise for manufacturing activities due to working place bottlenecks....however, we are removing final finished goods after paying full appropriate excise duty....whwther we have to mention the R.C.No.of all the the regd.units on the Sale-Invoice.... mohan sehgal (Posted On: 20 Jul, 2014)

You are required to mention registration number of the unit from which the final finished goods are being removed on the sales invoice. Registration number of other units need not be mentioned. Query replied by:- Ranu Dhoot
Dear Sir, We are into trading business of velcro. And we want to import velcro from China. Is there any way of exempting anti-dumping duty on import of velcro or hook and loop tape from China? NITI PATHAK (Posted On: 18 Jul, 2014)

Once anti dumping duty is imposed on a product there is no way out for getting exemption from the same. Since anti dumping duty has been levied on Velcro imported from china, there lies no way by which the same can be exempted. Query replied by:- Ranu Dhoot
I have small doubt for clarify that we have availed all the cenvat credit of dutiable inputs which will clear to stock trasfer to own co.(tariff:8701) without payment of duty , is it liable to pay or reverse the duty?. Pls clarify. Subramani.P (Posted On: 12 Jul, 2014)

Yes, you are required to reverse the credit taken on dutiable inputs which will be cleared to your other company because it is as good as clearance of duty paid inputs “as such” and the provisions of Rule 3(5) of the Cenvat Credit Rules, 2004 would be applicable. {Query replied by: CA Neetu Sukhwani & Ranu Dhoot}
Dear Sir, As u know that on 10-07-2014 at present FM has announced the budget as i saw that no change has been made in the excise rate,then as my client is manufacturing goods under the cetsh no.68042220 then from 11-07-2014 he has to charge 12.36% or else.Please reply hitesh (Posted On: 10 Jul, 2014)

The tariff head 68042220 pertains to “grinding wheels of other materials”. The excise duty specified in the Central Excise Tariff Act, 1985 continues to be 12.36% on the same. {Query replied by: Ranu Dhoot}
i would like to know complete procedure for trading activity from manufacturing activity N.S.Vinayagam (Posted On: 10 Jul, 2014)

In the absence of any prohibitory provisions in the Central Excise Rules 2002 and also the procedure laid down in the supplementary instructions, a manufacturer may bring duty paid goods in the registered manufacturing premises for trading purposes and no permission in this regard is warranted from the Central Excise Department. However, a factory cannot be allowed to receive goods from outside, which are identical to those manufactured by them without proper permission from the Commissioner. Hence, for bringing the duty paid goods for trading purposes which are identical to those manufactured in the factory the permission should be obtained by following the procedure as mentioned in the trade notice no. 553 / 63 / 2001 technical dated 29/11/2001} {Query replied by: CA Neetu Sukhwani & Ranu Dhoot}
Dear Sir, My one merchant exporter want to export ceramic tiles, cth no. 69089090. he want to take benefit of Packing box. for example, A is merchant exporter, he purched the box for packing the tiles from B (Excise registered unit) and send to tile manufacturer C. Now he want to make ARE - 1 for Packing box. It is possible.. ? Sunil Bhila (Posted On: 10 Jul, 2014)

It appears that ARE-1 for packing box is desired to be made so as to claim exemption from excise duty on the packing materials. However, the method as stated above is not possible because ARE-1 for packing box cannot be filed separately as ARE-1 is filed for finished goods only. It is however suggested that the manufacturer C, exporting tiles may follow the procedure as prescribed in notification no. 43/2001 -C.E. Dated-26/06/2001 and bring the packing material at nil rate of duty for use in the manufacture of final product, i.e., tiles which will be exported by ARE-2. It is also worth mentioning that the said ARE-2 should be signed both by the merchant exporter and the manufacturer of tiles. {Query replied by: Ranu Dhoot}
Dear Sir, we are rice exporter and make payment to CHA for rail freight incurred by him on our behalf, now on presenting his bill whether TDS will be liable on rail freight paid to him by us ? Second if payment made to CHA for ocean freight and CHA paid it to indian shipper then TDS under sec 194c will be attracted it or not? Arun (Posted On: 07 Jul, 2014)

We deal exclusively in excise, customs and service tax laws. Kindly consult a TDS consultant for the same. {Query replied by : Ranu Dhoot}
manufacturer having turn over above ssi limit 400Lacs. 100% sales is exported. but firm is not registered under excise. is it compulsory to registered for excise for 100% export firm.goods is under excise but all goods are exported there is no excise evasion still there will be any penalty or consequences for not having registration if registration compulsory. or excise is payable on exported goods as we are not registered Bharat Mange (Posted On: 01 Jul, 2014)

There is no need of taking Central Excise Registration by a 100% Exporter because the SSI limit of 4 crores does not include export sales. You have option to avail of the “Simplified Export Procedure For Exempted Units” as given in Part-III of the Chapter 6 of CBEC’s Central Excise Manual. However, declaration is required to be filed in terms of para 2 of the Notification no. 36/2001-CE (NT) dated 26.06.2001 and obtain declarant code number. Moreover, the proof of export is mandatorily required to be submitted within a period of 6 months from the date of clearance of goods from the factory of production. In case of clearances of such manufacturers where proof of export were not furnished within 6 months, exceed the exemption limit, they should take the central excise registration and follow the regular A.R.E.-1 procedure. {Query replied by: CA Neetu Sukhwani}
Dear Sir, One of my clients is a maufacturer of goods falling under cetsh no.85389000 as u know that the govt. had announced excise rate-cut on 17-02-2014 on above cetsh on account of relief as it was valid upto 30-06-2014, but few days before I read in papers that FM has extended the relief then do my client has to charge 12% or 10% from 01-07-2014.Please reply hitesh (Posted On: 01 Jul, 2014)

The excise duty cut announced vide notification no. 04/2014-CE dated 17.02.2014 has been extended upto 31.12.2014 vide notification no. 06/2014-CE dated 25.06.2014. Therefore, the reduced excise rates would be applicable till 31.12.2014. {Query replied by: CA Neetu Sukhwani}
Sir, our firm is a partnership firm and we avail security service who is a partnership firm. Are we under reverse charge mechanism and will deposit service tax under reverse charge mechanism. because as per notification if service receiver is body corporate then will be liable to pay service tax under this. please clarify Ajay Bansal (Posted On: 30 Jun, 2014)

As per notification no. 45/2012-ST dated 7.8.2012, security services provided by individual, HUF, proprietor, or partnership firm, AOP located in taxable territory provided to business entity registered as body corporate in taxable territory is leviable to service tax under reverse charge mechanism. As you being service receiver are a partnership firm and the service provider is also a partnership firm, reverse charge is not applicable and the service tax liability is to be discharged by the service provider.
Hello Sir, my query is that, We are manufacturers of turned components and we use lots of tools like Cutting tools, tools for turning and milling, carbide tip tools, which comes under Chapter 82, I believe and is considered as capital goods. These tools have a very short life and will be consumed within a week, after which they are considered as scrap, invoiced and cleared in the same financial year. Since according to rule 4 sub 2 A of cenvat credit rules, "The CENVAT credit in respect of capital goods received in a factory or in the premises of the provider of output service at any point of time in a given financial year shall be taken only for an amount not exceeding fifty per cent. of the duty paid on such capital goods in the same financial year: Provided that the CENVAT credit in respect of capital goods shall be allowed for the whole amount of the duty paid on such capital goods in the same financial year if such capital goods are cleared as such in the same financial year". Please clarify, what "cleared" means in the above rule. These tools are cleared as scrap, so can we claim the cenvat credit for whole amount (100%) for these tools or do we have to take only 50% this year and 50% in subsequent years. Please reply, Thanks, Ramachandra Aditya (Posted On: 30 Jun, 2014)

As per provision of CCR, 2004 only 50% credit can be taken in same financial year on receipt of capital goods and balance 50% in subsequent to the financial year in which capital goods received in the factory subject to possession of capital goods. 100% Cenvat credit can only be taken in same financial year if such capital goods are removed/cleared “as such”. Expression “as such clearance” means without any use but in your case you are clearing the capital goods as scrap after being used so 100% cenvat credit cannot be taken in same financial year. Therefore, you are required to take balance 50% credit in the subsequent financial year by placing reliance on the provision of Rule 4(2)(b) of the Cenvat Credit Rules, 2004 which provides exception to the condition of possession of capital goods in subsequent years for components, spares, accessories, refractories and refractory materials, moulds and dies and goods falling under heading 6805, grinding wheels and the like. It can be pleaded that the cutting tools, grinding tools etc. are accessories of the capital goods. {Query replied by CA Neetu Sukhwani & Manish Bhati}
Hello Sir, my query is, For Tools, such as cutting tools, grinding tools, tools for turning and milling and carbide tip tools falling under chapter 82 on central excise, are considered as capital goods. These tools are used for manufacturing purpose and they are consumed within a week and then cleared and invoiced as scrap and sold. However, when claiming the CENVAT credit for these goods, should we claim 50% this year and rest subsequent years or can the whole CENVAT credit be claimed in the same financial year?, since according to rule 4, quote :"Rule 4,(2) (a) The CENVAT credit in respect of capital goods received in a factory or in the premises of the provider of output service at any point of time in a given financial year shall be taken only for an amount not exceeding fifty per cent. of the duty paid on such capital goods in the same financial year: Provided that the CENVAT credit in respect of capital goods shall be allowed for the whole amount of the duty paid on such capital goods in the same financial year if such capital goods are cleared as such in the same financial year." Please clarify, as to what cleared in the above rule means and whether we should claim 100% credit or only 50%. Thanks Ramachandra E N (Posted On: 27 Jun, 2014)

As per provision of CCR, 2004 only 50% credit can be taken in same financial year on receipt of capital goods and balance 50% in subsequent to the financial year in which capital goods received in the factory subject to possession of capital goods. 100% Cenvat credit can only be taken in same financial year if such capital goods are removed/cleared “as such”. Expression “as such clearance” means without any use but in your case you are clearing the capital goods as scrap after being used so 100% cenvat credit cannot be taken in same financial year. Therefore, you are required to take balance 50% credit in the subsequent financial year by placing reliance on the provision of Rule 4(2)(b) of the Cenvat Credit Rules, 2004 which provides exception to the condition of possession of capital goods in subsequent years for components, spares, accessories, refractories and refractory materials, moulds and dies and goods falling under heading 6805, grinding wheels and the like. It can be pleaded that the cutting tools, grinding tools etc. are accessories of the capital goods. {Query replied by CA Neetu Sukhwani & Manish Bhati}
I got information from someone as parts of harvester ( machinery of farming)cab be sold without payment of excise duty. is it correct? if yes then can you give me reference notification / circular no.? Yogesh Pawar (Posted On: 27 Jun, 2014)

The harvesting & threshing machinery fall under the tariff head 8433 of the Central Excise Tariff Act, 1985 wherein Nil rate of excise duty is being specified against all the items of this tariff heading. Consequently, all items under this tariff head are to be sold without payment of excise duty. Since nil rate of duty has been mentioned in central excise tariff itself, there lies no need of any exemption notification for the same. Query replied by:- Ranu Dhoot
My company is having two branches. One is located in Gurgaon-Haryana and another is located in Bhiwadi-Rajasthan. Both the branches are registered with excise department. Gurgaon branch is manufacturing Cushion cover exempt from excise under Notification No. 30/2004-C.E dated 9th July 2004.Gurgaon branch is transferring the cushion to Bhiwadi branch as stock transfer against F-form. Bhiwadi branch is carrying out the further processes of filling and stitching and complete cushion are sold as excisable goods. My query is that whether the procedure followed by us is correct by paying the duty on complete cushion at bhiwadi location when it get covered under excisable goods category. Whether the Bhiwadi branch is required to get registered under depot sale or we can prepare the invoice with our exisiting excise registration no. CA Santosh jangra (Posted On: 24 Jun, 2014)

We submit that as your Gurgaon Branch is manufacturing Cushion cover that are exempt under notification no. 30/2004-CE, there was no need to take central excise registration for the said unit because it manufactures exempted goods. Moreover, registration for “depot sale” cannot be taken for your Bhiwadi unit because registration under depot sale is taken when the excisable goods are merely traded. Since certain manufacturing activity is being carried out at Bhiwadi unit, registration cannot be taken as depot for the said unit. The Bhiwadi unit has been correctly registered as manufacturing unit and the unit should clear the excisable goods on payment of excise duty. {Query Replied by Hushen Ganodwala and CA Neetu Sukhwani}
Dear Sir, My company is having two branches in two different states-Haryana-gurgaon and Rajasthan -Bhiwadi. Both branches are regsitered under excise Act. My gurgaon Branch is manufacturing the Cushion cover which are exempt under notification No. 30/2004-C.E Dt 09.07.2004. These cushion cover are transferred from gurgaon to Bhiwadi location. In bhiwadi process for filing the fibre and stitching is carried out and final product"cushion" is sold to the Customer with excise duty applicable as cushion is covered under chapter 9404. Kindly let me know whether my bhiwadi branch should get registerd for "depot sale" or we can transfer the cushion cover from Gurgaon as exempted goods and sold them after processing as excisable goods without any registration as manufacturing process is completed at bhiwadi location. kindly advise. CA Santosh jangra (Posted On: 24 Jun, 2014)

We submit that as your Gurgaon Branch is manufacturing Cushion cover that are exempt under notification no. 30/2004-CE, there was no need to take central excise registration for the said unit because it manufactures exempted goods. Moreover, registration for “depot sale” cannot be taken for your Bhiwadi unit because registration under depot sale is taken when the excisable goods are merely traded. Since certain manufacturing activity is being carried out at Bhiwadi unit, registration cannot be taken as depot for the said unit. The Bhiwadi unit has been correctly registered as manufacturing unit and the unit should clear the excisable goods on payment of excise duty. {Query Replied by Hushen Ganodwala and CA Neetu Sukhwani}
Dear Sir I am having some doubt on following in service atx 1)Whether Cenvat available on service tax mentioned in Air/Railway Ticket 2)Whether Cenvat available on Service Tax element onBank Charges say bank Guarantee Charges, Processing Fee,RTGS chargesw etc. available 3)whether ST liability is there on Reimbursement of Expenses 4)Whether Service Tax on reverse charge is appliable on Membership Fee paid abroad 5)Whether CENVAT on Guest house related expenses are available 6)Whether CENVAT available if the name of employee mentioned in Hotel bill instead of company Name 7)If we undertake the activity of Repair then CENVAT Avaialble or not. Thank You Sir akash gupta (Posted On: 23 Jun, 2014)

Definition of input service as given in Rule 2(l) is wide enough to incorporate numerous activities within its gamut. 1) Yes, Cenvat is available on service tax mentioned in Air/Railway Ticket if such expenditure is business expenditure. 2) Yes, Cenvat is available on Service Tax element on Bank Charges (bank Guarantee Charges, Processing Fee, RTGS charges etc.) because it is directly a business expenditure. 3) Recently, Delhi High Court has held that in the case of Intercontinental Consultants and Technocrafts Ltd. [ 2012-TIOL-966-HC-DEL-ST] that inclusion of reimbursable expenses in the taxable value of service is ultra vires and so as of now, service tax may not be paid on reimbursement of expenses by placing reliance on the above cited decision. However, if the same is paid then the credit will be available subject to condition that it is used in manufacture of final product or for providing output service. 4) Since the nature of the membership fees is not clear we are unable to advise you in this regard. Kindly provide us with more details regarding the same so that we are able to make a correct opinion on it. 5) CENVAT on Guest house related expenses are available only if expenses are directly related to business purposes. 6) If the name of employee mentioned in Hotel bill instead of company name, the department will contend that cenvat credit cannot be taken by company. However, the credit may be allowed in litigation if we are able to prove that it is expenditure related to business and only bill has been raised in the name of employee. 7) We are not able to understand the query. Please elaborate. {Query Replied by: Ranu Dhoot}
Sir, let "A" is a manufacturing company & sold their finish goods in different states.and provide "Bahati" as required on behalf of transporter for clearing the vehicle at check post and take charges from transporter against Bahat"charges & the charges will show in account books as ohther income.in this condition company"A"required to deposit service tax on received amount from transporter as a"Bahti charges? P.S.Butola (Posted On: 23 Jun, 2014)

We are unable to understand your query properly because the meaning of “Bahati” is not clear to us. However, on the assumption that the sale of finished goods by Company A has nothing to do with providing services to the transporter, the reply to your query is as follows. We submit that it appears that you are providing certain services to the transporter for which consideration is being received by you and the same is also shown in your books of accounts as income. We submit that as the services of clearing the vehicle at check post is not exempted in the negative list or the mega exemption notification, the same would be leviable to service tax. {Query replied by CA Neetu Sukhwani & Hushen Ganodwala}
Hi, Banking industry is paying service tax on different services chargeable to service tax. Can this be utilised for payment of service tax as an input credit. If yes in what Proportion? Is there any thumb rule governing the same? Prashant (Posted On: 22 Jun, 2014)

There is a special provision prescribed in Rule 6(3B) of the Cenvat Credit Rules, 2004 for banks wherein it has been stated as follows-“Notwithstanding anything contained in sub rules (1), (2), and (3) of the Rule 6 of CCR, 2004, a banking company and a financial institution including a non-banking financial company [engaged in providing services by way of extending deposits, loans or advances] shall pay for every month an amount equal to fifty per cent of the Cenvat Credit availed on inputs and input services in that month.” As the above provision is specific to banking company and overrides the general provisions of Rule 6, it appears that a banking company is eligible to avail service tax credit on all the services and in compliance of provision of Rule 6 is required to reverse fifty per cent of the amount of credit availed in a particular month. Accordingly, except the credit reversed under Rule 6(3B), all the credit availed by a banking company may be utilised by them. However, the utilisation is subject to the provisions of Cenvat Credit Rules, 2004 like for reverse charge, payment cannot be made through cenvat credit. {Query Replied by Hushen Ganodwala and CA Neetu Sukhwani}
Dear Sir, Pl tell me , Form I or H is required against sales of CT-3 in lieu of sales tax or not. Regards A singh Abhimanyu Singh (Posted On: 18 Jun, 2014)

We do not deal in Sales tax law. Please ask queries relating to Excise, service tax and custom. {Query Replied by: Hushen Ganodwala}
Sir, I am doing crushing of stone and making it in form bajri used in making road by extracting it from hills by paying royalty to government and sale in the market whether it amounts to manufacture. Please revert on these email id -shahmanish47@gmail.com SSAS (Posted On: 18 Jun, 2014)

Section 2(f) of the Central Excise Act, 1944 states that “Manufacture” includes any process,- i. Incidental or ancillary to the completion of a manufactured product. ii. Which is specified in relation to any goods in the Section or Chapter notes of [the First Schedule] to the Central Excise Tariff Act, 1985 (5 of 1986) as amounting to [manufacture; or] iii. Which in relation to the goods specified in the Third Schedule, involves packing or repacking of such goods in a unit container or labeling or re-labeling of containers including the declaration or alteration of ret5ail sale price on it or adoption of any other treatment on the goods to render the product marketable to the consumer,] Moreover, the Hon’ble Supreme Court has held in Hawkins Cookers Ltd. Vs Collector [1997 (96) E.L.T. 507 (S.C.)] that to levy central excise duty, a new article should come into existence as a manufacturing activity. Thus, crushing of stone and making gravel (bajari) from it shall amount to manufacture as crushing amounts to activity for making manufactured product ‘gravel’ falling under the chapter head 251710. However, it is to be noted that Gravel is an excisable good with NIL rate of duty. {Query replied by Ranu Dhoot}
Sir, whether cenvat credit on courier BOE is allowed? please guide. Sachin (Posted On: 17 Jun, 2014)

The Cenvat credit can be availed on the courier BOE as under Rule 9 (c) of the Cenvat Credit Rules, 2004 specifying the documents on the basis of which cenvat credit may be taken also specifies bill of entry as the eligible document for availing credit. As it is mentioned bill of entry, courier bill of entry would also be eligible provided it is original. Query replied by CA Neetu Sukhwani
A private limited company is running a pre-university college. I would like to know whether it is exempt from service tax Ravindra (Posted On: 16 Jun, 2014)

As per clause (l) of section 66D specifying the negative list of services, pre-school education and education upto higher secondary school or equivalent and education as a part of a curriculum for obtaining qualification recognised by any law for the time being in force is exempted from service tax levy. Therefore, services provided by a pre-university college are exempt from service tax. Query replied by Pooja Mehta
I would like to know whether education institution (Pre-university college) run by a private limited company is exempt from service tax. Ravindra (Posted On: 16 Jun, 2014)

As per clause (l) of section 66D specifying the negative list of services, pre-school education and education upto higher secondary school or equivalent and education as a part of a curriculum for obtaining qualification recognised by any law for the time being in force is exempted from service tax levy. Therefore, services provided by a pre-university college are exempt from service tax. Query replied by Pooja Mehta
Dear Sir, we have registers as dealer under central excise deprt earlier we doing ( buying material in india as well as import from out side india ) but now department asking to take separate ECC no as importer please let me known as per department we have to maintain two invoice book as dealer and importer in one premises and different ecc no is it possible is there any new law introduced by gov please we waiting for your advice on above matter Umesh Bora (Posted On: 14 Jun, 2014)

Vide Circular No. F.No. IV/16-24/CCO-II/MCX/2014 clarification had been issued to the President of ‘The Chemical& Alkali Merchants Association', Mumbai, the Chief Commissioner, Mumbai-II Zone in which it had been clarified that “Since importer and dealer have different registration number, separate accounts and sets of invoice book are required to be maintained for each category of business.“ {Query replied by:-Ranu Dhoot}
dear sir, we take service of GTA for sending goods to port. this service is taken against export sales of goods. then is service tax is applicable on GTA service or not. JITENDRA CHOPRA (Posted On: 14 Jun, 2014)

Service tax is applicable on GTA service under reverse charge if the conditions as stated are satisfied. However, in case of GTA service being availed for sending goods from the factory to the place of export, there are three options available with the exporter. The first option may be to avail the credit of the service tax paid on GTA service. The second option may be to pay service tax and then claim refund of the same under notification no. 41/2012-ST dated 29.06.2012. The third option may be to claim exemption from payment of service tax on GTA service availed in relation to export of goods under notification no. 31/2012-ST dated 20.06.2012 but in such a case the exporter shall have to produce consignment note issued in his name and file return in EXP-2 every six months. Query replied by CA Neetu Sukhwani
dear sir, we take service of GTA for sending goods to port. this service is taken against export sales of goods. then is service tax is applicable on GTA service or not. JITENDRA CHOPRA (Posted On: 14 Jun, 2014)

Service tax is applicable on GTA service under reverse charge if the conditions as stated are satisfied. However, in case of GTA service being availed for sending goods from the factory to the place of export, there are three options available with the exporter. The first option may be to avail the credit of the service tax paid on GTA service. The second option may be to pay service tax and then claim refund of the same under notification no. 41/2012-ST dated 29.06.2012. The third option may be to claim exemption from payment of service tax on GTA service availed in relation to export of goods under notification no. 31/2012-ST dated 20.06.2012 but in such a case the exporter shall have to produce consignment note issued in his name and file return in EXP-2 every six months. Query replied by CA Neetu Sukhwani
Dear Sir, My query is that one of my clients wants the extension in the jobwork challan of which the limit of 180 days is about to be come to an end then what is the procedure I have to follow with the department. hitesh (Posted On: 14 Jun, 2014)

There is no procedure to extend the time limit of 180 days for the job work challan. As per Rule 4 (5)(a), the manufacturer getting the job work done should reverse the credit attributable to the inputs sent on the job work and should avail the credit again on the receipt of the goods after job work in his premises. This is the only procedure prescribed in the Cenvat Credit Rules that is required to be followed by the manufacturer getting the job work done by job worker. {Replied by CA Neetu Sukhwani}
Good Morning Sir, We are coversion agent of tata steel.We convert GP coil into corrogated sheet. Issue- We dispatch sheet to third party as per tata shedule and charge excise duty on the invoive. This excise duty we get reimbuse from tata. We raise service tax bill to tata for conversion charge. My question is whether we can get credit of input excise duty on input against output service tax. ANKUR AGARWAL (Posted On: 13 Jun, 2014)

Respected sir, Your query holds a bit of ambiguity. You are doing job work for Tata steel but liable to pay Excise Duty as you are manufacturer. Secondly, you are also charging service tax on the conversion charges. Firstly, when you are paying Excise Duty on your final product which implies that the process undertaken by you amounts to manufacture. If this is the case, then you need not to pay service tax on conversion charges. Secondly, it is not clear that you intend to take credit on which goods/ service? The inputs which are used in manufacture of dutiable final product, the credit will be available to you. If these inputs are those which have been used by you for converting the GP coil in corrugated sheet than the credit of the same is admissible. But if you are talking about the credit on the excise duty charged on the invoice than such credit is not admissible as it is being reimbursed by Tata. Hence the same is not borne by you and credit for same is not admissible. {Query replied by:-Prayushi Jain}
Dear Sir, we are providing hiring of Boom Lifts, JCB,Plant & Machinery services,we are registered with service tax we have imported the Boom Lift which is used in our business for 3 years and we have availed CENVAT Credit at the time of Import ,we have exported the same machine What will be the service tax & Mvat liability Raman Kankaria (Posted On: 10 Jun, 2014)

We clarify that the activity of exporting machine would not attract service tax. However, as you have availed Cenvat Credit at the time of Import, thus Rule 3(5A) of Cenvat Credit Rules 2004 shall become applicable. As per Rule 3(5A) of Cenvat Credit Rules 2004,” If the capital goods on which Cenvat Credit has been taken, are removed after being used, whether as capital goods or as scrap or waste, the manufacturer or provider of output services shall pay an amount equal to CENVAT Credit taken on the said capital goods reduced by the percentage points calculated by straight line method as specified below for each quarter of a year or part thereof from the date of taking the CENVAT Credit, namely:- (a) For computers and computer peripherals: • For each quarter in the first year @ 10% • For each quarter in the second year @ 8% • For each quarter in third year @ 5% • For each quarter in the fourth and fifth year @ 1% (b) For capital goods, other than computers and computer peripherals @ 2.5% for each quarter: Provided that if the amount so calculated is less than the amount equal to the duty leviable on transaction value, the amount to be paid shall be equal to the duty leviable on transaction value. Therefore, there will be liability of credit reversal as stated above. {Query replied by Ranu Dhoot}
IS REALTY SHOW TAXABLE UNDER SERVICE TAX, IF YES THAN IN WHICH SERVICE PLEASE REPLY Yogesh Verma (Posted On: 09 Jun, 2014)

After the applicability of Negative List under Section 66D of Finance Act, all services have become taxable except the services as mentioned in the list. Since, reality show is not covered under negative list, hence it is taxable. The reality show will be classifiable under the category of “EVENT MANAGEMENT SERVICE”. {Query replied by Ranu Dhoot}
A PurchaseTicket from B and earns certain commission from B.A then sell ticket to Customer C.Both A and B are Air Travel Agents.A pays st on basic fare of ticket by collecting from C.B pays st calculated on commission received from airlines.Now,A is charging i.e collecting st from B i.e100*12.36/100 .Can A can follow both basic fare and comm model for same service?Can A can charge st to B if he is already collecting st from C on basic fare for same service?Can B take cenvat Of st paid to A? Chandani (Posted On: 08 Jun, 2014)

Chandani (chandani.gadhia@rediffmail.com) Respected maam, In respect to your query submit that an air travel agent once chooses between commission model and basic fare he has to apply same model uniformly till the completion of one financial year. Further yes a same service can be chargeable to tax twice as in indirect tax laws there is mechanism of credit which sets off the tax paid. Therefore if the same service is being charged twice to service tax than he can avail credit as it is input service for his output service. Yes as already stated above, Cenvat credit can be availed. {Query replied by:-Prayushi Jain}
Respected Sir, If under Reverse Charge Mechanism a company paid for the transport ageny and for advocate as a service receipent, can this payment be taken as input for other service tax payment Surbhi (Posted On: 07 Jun, 2014)

It is understood that you are asking whether credit of service tax paid under reverse charge mechanism can be availed and utilised for discharging other service tax liabilities. In this respect, we submit that there is only restriction as regards payment of service tax in cash for services covered under the reverse charge mechanism. However, the service tax paid under reverse charge mechanism would be available as credit on the basis of challan through which payment was made and the credit can be utilised for discharging all service tax liabilities except those under reverse charge. {Query replied by Ranu Dhoot}
Is a firm liable for service tax on visa consultancy provided to students. source of revenue: 1) fee from students 2) commission from foreign universities. Manish Singhal (Posted On: 06 Jun, 2014)

The service tax would be leviable on the commission received from the foreign universities because the education services provided by foreign universities are taxable to service tax and are not covered by the entry no. 9 of the mega exemption notification no. 25/2012-ST dated 20.06.2012 read with clause (l) of section 66D pertaining to the negative list. It is submitted that the mega exemption notification provides exemption to auxiliary education services provided to educational institution that provides exempted education services. Further, negative list states that education services that are provided as a part of curriculum for obtaining qualification recognised by law in India is exempted from service tax. As the education services provided by foreign universities are recognised by foreign laws, they are not covered by the negative list and consequently also not covered by the mega exemption notification. Further, as per Place of Provision of Service Rule 9, in case of intermediary services, the place of provision of service shall be the location of service provider. In the present case, as the firm providing visa consultancy services is located in India, the place of provision of service is in taxable territory. Therefore, when the service is taxable and is also provided in taxable territory, i.e., in India, service tax will be leviable on the same. Query replied by CA Neetu Sukhwani
Respected Sir, I have query related to rent a cab service under RCM. I have received a bill against bus hire charges for carrying employee from station to company and he is charging service tax @4.944% in his bill,so my query is service tax charge in the bill is correct or not? 1.Service provider is individual , as per his PAN number provided in the bill. 2. service receiver is company. (Posted On: 06 Jun, 2014)

As per notification no. 30/2012-ST dated 20.6.2012, reverse charge mechanism applies under rent a cab service if service provider is individual, HUF, or partnership firm and the service recipient is business entity registered as body corporate. Hence, the reverse charge mechanism is applicable in the present case. As far as the rate of service tax is concerned, serial no. 9 of the Abatement Notification No. 26/2012-ST dated 20.6.2012 provides that 40% is taxable value for the service of rent a cab. Thus, effective service tax rate is 40% of 12.36% that comes out to 4.944%. Thus the service provider has correctly charged service tax @ 4.944% in the bill. {Query replied by Ranu Dhoot}
sir one of my client is a retired employee of AP Genco. post retirement he tookup an engagement with a power plant to maintain its green belt operations i.e plantation and plants maintenance and plantation development across more than 100 acres of green belt sourounding the power plant. now the query is wether these services are taxable in service tax. i want to claim exemption u/s 66D is it valid. please advise. anil kumar (Posted On: 05 Jun, 2014)

ANS. Entry (d) of Section 66D of Finance Act, 1994 states “services relating to agriculture or agricultural produce by way of- i. Agricultural operations directly related to production of any agricultural produce including cultivation, harvesting, threshing, plant protection and seed testing. ii. Supply of farm labour iii. Processes carried out at an agricultural farm including tending, pruning, cutting, harvesting, drying, cleaning, trimming, sun drying, fumigating, curing, sorting, grading, cooling or bulk packaging and such like operations which do not alter the essential characteristics of agricultural produce but make it marketable for the primamry market. iv. Renting or leasing of agro machinery or vacant land with or without a structure incidental to its use v. Loading, unloading , packing, storage and warehousing of agricultural produce vi. Agricultural extension services. vii. Services by any Agricultural Produce Marketing Committee or Board or service provided by a commission agent for sale or purchase of agricultural produce” Maintaining green belt operations neither relate to any of the sub points mentioned above, nor it is covered under any other point of Negative List. Hence the services of your client shall be entirely taxable. {Query replied by:-Ranu Dhoot}
I want to know about calculation of SSI limit 10lacs in case of service provider provide service to bodycorporates and comes under reverse charges. say billed 12 lac and 50:50 is applicable. So can i say that i am not liable to pay as i m responsible for 50% i.e. 6lacs ans basic exemption can i claim Bharat Mange (Posted On: 01 Jun, 2014)

For the purpose of determining eligibility of small scale exemption in the current year, what is relevant is that “aggregate value of taxable services rendered” in the previous financial year should not exceed Rs 10 lakhs. “Aggregate value” means the sum total of value of the taxable services charged in the first consecutive invoices issued or required to be issued, as the case may be, during a financial year but does not include value charged in invoices issued towards such services which are exempt from whole of service tax leviable thereon under section 66 of the Finance Act under any other notification”. Moreover, small scale exemption is not available to the service recipient for the services on which service tax is payable under reverse charge mechanism. We submit that in case of a service provider providing the works contract services on which service tax is payable only to the extent of 50%, the service provider cannot claim 50% of the value of service as the “taxable value” for the purpose of computing small scale service provider exemption. The reason for the same is that 50% liability is casted on the service recipient and it does not mean that there is 50% exemption to the service provider. Accordingly, the value of taxable services for the purpose of SSI exemption would be Rs. 12 Lakhs in the present case and not Rs. 6 Lakhs. {Query replied by Ranu Dhoot}
I regularly read your articles , opinions and views on taxmanagementindia.com and really appreciate your contribution . Sir I need a valuable opinion on service tax issue I would very much grateful for the same. A Real Estate service Provider firm “A” having taxable services less than 10 lacs hence exempted in F.Y 11-12. In following year F.Y 12-13 raised four bills each of 30 lacs approx ( aggregating 120 Lacs) in August-2012 on company “B” , but the bills were disputed by the service receiver “B” and negotiation were done but remain un-settled till 31/03/2013. But the service receiver provided an amount of 110 lacs in his books on which he has done TDS of Rs. 16 lcas approx. Now in order to reconcile for Income purpose and to get credit of Tax the firm “A” also offered the amount for tax during the year 12-13 . Eventually bills were settled in June-13 ( F.Y 13-14) and service tax liability was duly settled on actual gross receipt and tax being paid on receipt basis was shown in St-3 for Period Apr-Sep-2013. But now the issue was raised by the department that liability arises on due basis beyond 50 lacs as per proviso to Rule 6 of service tax as the aggregate amount of taxable services exceeded 50 lacs . The department intend to levy interest and penalty for delayed payment of taxes. Can “A” take stand that we have offered Income for Income tax purpose in order to get benefit of Prepaid tax ( TDS) and bills were settled in June-13 and accordingly taxes were paid hence no question of interest and penalty thereof. Is contention of “A” tenable in law . Pls Guide. CA.Mohammed Lakkadsha (Posted On: 30 May, 2014)

The fourth proviso to rule 6(1) of the services tax Rules, inserted with effect from 1/4/2012, provides that in case of individuals and partnership firm whose aggregate value of taxable services provided from one or more premises is 50 lakhs rupees or less in the previous financial year, the service provider shall have the option to pay tax on taxable services provided or to be provided by him up to a total of rupees 50 lakhs in the current financial year, by the dates specified in rule 6(1) with respect to the month or quarter, as the case may be, in which payment is received. As per this case, “A” has provided 10 lakhs rupees in F.Y. 11-12 , this is below the limit i.e. 50 lakhs rupees, so benefit will be available.
Dear Sir, We are manufacturer and registered with Central Excise. Recently we had supplied one machine to our client who is in SEZ. Our client had sent us Eligibility Certificate of SEZ. Now we supplied the machine with ARE-1 without and bond or LUT. Now Excise department is asking us to pay the excise duty as we have not furnished the LUT or Bond. Kindly help me on the issue. What can we do now. Do we pay excise duty + interest and penelty. Is there any way of getting this duty back. We are newly registered to excise department. Kindly help... Thanks you in anticipation. SUNDEEP RAJPUT (Posted On: 29 May, 2014)

As per law in case of Export/SEZ either we have to give bond/LUT. But you can plead that it is procedural requirement. The goods have been delivered to SEZ unit and proof of the same should be submitted to the department. Thus, the procedural infraction cannot take away the substantive right of exemption. Hence the export has taken place, no need to pay the duty.
Dear Sir, The GOI has reduced Excise Duty on Certain Capital Goods up to 30/06/2014. Now a case has arisen: Principal Supplier sends goods attracting Central Excise duty 12% to Job Worker for fabrication of Intermediate Goods used in the production of Final Product . Job Worker avails Cenvat Credit and sends Intermediate Goods attracting Excise Duty @10% to Principal Manufacturer. The CENVAT Credit does not get set off against Job Worker's Assessable. Cenvat Credit remains in Excsie Records. Please advise how and under which document job worker can return excise duty to the Principal manufacturer. Regards, Vinod Vinod (Posted On: 22 May, 2014)

Cenvat credit can be passed by paying the Central excise duty under invoice issued under Rule 11 of Central Excise Rules, 2004. The duty is payable as applicable at the time of clearance of goods from factory. Hence, you cannot pay duty more than that. If you have followed the procedure of Rule 4(5)(a) of Cenvat Credit Rules or under Notification 214/86 then the job worker would not have availed the credit as well as paid the duty while clearing the goods.
Dear Sir Please explain whether downloading of software in India from outside india liable to service tax on reverse charge akash gupta (Posted On: 20 May, 2014)

Downloading of software from out of India (whether tailor made or branded) would attract service tax. Because if this software is in nature of packed software than also it will fall under the purview of “Packed Software”. The person who download the software will be treated as Importer and liable to Service Tax under Reverse Charge Mechanism. This view is also published in para 6.4.4 of CBEC’s TAXATION OF SERVICES: AN EDUCTIONAL GUIDE”. This issue is still confusing and department may raise issue in this regards, so it is better to inform to department to avoid charge of suppression.
Dear sir, One of my client want to export sale to usa i.e export of software. Whether Service tax and vat is applicable on it. He will sale by sending link for download. Please Reply thankig you jharna saxena (Posted On: 14 May, 2014)

As the export is being done by sale of software through a link therefore it shall fall under Online information and database access or retrieval services under Rule 9 of Place of provision rules,2012. By applying these provision the place of provision of service shall be location of service provider i.e. in India and not of receiver i.e. USA.
Whether Service Tax credit can be availed in the input service wlie providing Construction service as an output service. If yes please state the Notification or any circular number, if any? Sandeep Shah (Posted On: 12 May, 2014)

ANS. The definition of input service specifically excludes services: “Specified in sub clauses (p), (zn), (zzl), (zzm), (zzq), (zzzh), (zzzza) of clause (105) of section section 65 of the Finance Act (hereinafter referred as specified services) in so far as they are used for - (a) construction or execution of works contract of a building or a civil structure or a part thereof; or (b) laying of foundation or making of structures for support of capital goods, except for the provision of one or more of the specified services” Thus, we can conclude that except from the above mentioned (a) & (b) credit can be availed in the input service while providing Construction service as an output service. Also, notification no. 26/2012-ST, dated 20-6-2012 Sl. No. 12 states the conditions for availing Cenvat credit on “construction of a complex, building, civil structure or a part thereof, intended for a sale to a buyer, wholly or partly except where entire consideration is received after issuance of completion certificate by the competent authority state as follows (i) CENVAT credit on INPUTS used for providing the taxable service has not been taken under the provisions of the CENVAT Credit Rules, 2004; (ii) The value of land is included in the amount charged from the service receiver.” This notification also in no way disallows availing credit of input services for providing Construction service as an output service. Hence, Service Tax credit can be availed in the input service while providing Construction service as an output service. {Query replied by:-Ranu Dhoot}
on which amount service tax to be deducted in case of import of service. e.g. Service provider has charge rs. 100 TDS to be borne by service recipient rs. 20, hence cost for the service recipient is 120 and service provider has charged rs. 100 Now on which amount ST to be charged...? Whether on rs. 100 or rs. 120...! Bhavik Soni (Posted On: 12 May, 2014)

First of all when the Service provider charges Rs. 100 & TDS of Rs. 20 is deducted, then the cost of the service to the service recipient shall be Rs. 80 instead of Rs. 120. Service tax shall be charged on Complete Rs 100 i.e. the amount charged from the service recipient inclusive of TDS.
Dear Sirji, Wishes to you for the excellent services rendered to the readers and netizens. Kindly clarify the following query. A Public limited company is registered with excise dept and paying excise duty and availing only cenvat on goods (inputs. The company is registered with service tax dept with centralised RC mainly for C&F and warehousing operations and avails input services of all the branches including excise unit in discharging output service tax. As limited company, they are paying reverse charge for almost all the services listed in the notification. Now the question is, what are the input services they are eligible to claim from the following reverse charge services paid by them by cash under separate challan. 1) advocate fees 2) manpower supply for production of excisabale and non-excisable 3) rent a cab service 4) works contract service 5) Directors sitting fees etc., 6) GTA inward and outward 7) import services -paid in foreign exchange. Regards, rengaraj (Posted On: 11 May, 2014)

A manufacturer or service provider is eligible for availing Cenvat credit of service tax paid on his input services, excise duty paid on his inputs and excise duty paid on the capital goods. Thus whether the credit of any service can be availed needs to evaluated by judging whether a service falls under the definition of input services or not. The credit of services covered under Reverse charge mechanism can be claimed in the following manner: 1) Advocate fees: Credit can be claimed provided it is wholly used for providing output service or used in manufacture of final product. 2) Manpower supply: Credit can be claimed only on the manpower supply used for production of EXCISABLE goods or providing taxable output service. 3) Rent a cab: Credit cannot be claimed as it is specifically excluded from the definition input services 4) Works contract service: Credit can be claimed on all works contract except in the following situation: • construction or execution of works contract of a building or a civil structure or a part • repair and maintenance related to a motor vehicle which is not a capital goods 5) Director’s sitting fees: Credit can be claimed as it is wholly related to business purposes and this service is not excluded from the definition of input services. 6) GTA inward and outward: Credit can be claimed on GTA inward if it is wholly related to business purposes. But there is dispute on GTA outward. The definition says that freight paid upto place or removal is allowed. The CBEC has issued circular that the credit will be allowed if three conditions are satisfied viz. the agreement is FOR delivery, the burden of intransit loss is on consignor and lastly, the excise duty is paid on price which includes freight also. This view was also affirmed by Punjab and Haryana High Court but the latest Kolkatta High Court has given the contrary view. Hence the issue is not settled for credit on outward freight. 7) Import services -paid in foreign exchange: Credit can be claimed as it falls in the definition of "input service" and input service is used for providing output service.
assessee has let out premises on rent to Central Excise Dept. Since such letting out was not for use in business or commerce, the same was not liable to service tax till 30/06/2012. The same has become taxable from 01/07/2012. Is this correct? SANJAY BOBRA (Posted On: 08 May, 2014)

Before introduction of the negative list tax regime, Renting of Immovable property was taxed under Section 65 (105) (zzzz). Renting of immovable property was brought into tax net vide Notification No. 23/2007-ST dated 01.06.2007 but since then the government offices in rented buildings were claiming that service tax is not payable as their activities were not in furtherance of business or commerce but performing statutory functions of public authority . Hence, it was not liable to pay service tax. In the new service tax scheme based on negative list of services, Section 65B (41) of Finance Act, 1994 (introduced w.e.f. 1-7-2012) defines renting “as allowing, permitting or granting access, entry, occupation, usage or any such facility, wholly or partly, in an immovable property, with or without the transfer of possession or control of the said immovable property and includes letting, licensing or other similar arrangements in respect of immovable property”. The words “for use or furtherance of business or commerce” are not available in the current definition under the negative list scheme, and hence the government offices will also have to pay the service tax on rent of the building which is used to perform their regulatory functions. {Query replied by: CA Neetu Sukhwani & Ranu Dhoot}
Sir, some transporters viz., SRMT, DATTI, SAFE EXPRESS etc., issue bills duly charging service tax but never issue Consignment Note (LR). In such case, is service receiver is liable to pay tax on the freight amount? Actually, these transport companies are liable to pay tax at all? Does GTA mean who arranges a truck and issues LR/CN and charges no service tax and collects commission from truck owner? In this case, is service recipient liable to pay tax, if otherwise liable by virtue of status? Thank you sir. CA. C V SURYAM (Posted On: 06 May, 2014)

GTA is defined in Section 65B(26) as “goods transport agency” means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called. The definition is clear enough to exclude such transporters as they do not issue consignment note. Since these are not GTA, service receiver is not liable to pay tax on the freight amount. These all are falling under courier services and hence they charge 12% service tax.
Dear sir , A manufacturer is required to carry out basic sales and marketing activities for selling its product along with sales promotion like dealers meet , field trial etc . the basic sales and marketing activities are meant for selling its products . Therefore it is possible to argue that entire selling and marketing activities are for clearing its goods from the place of removal i e factory or godowns or subsequent sales promotion activities and are fully covered under the definition of input services and eligible for full cenvat credit .Kindly clarify whether this argument hold good in view of the fact sales commission agent services have not been treated part of input service in some of the recent judgement . thanks . ssgaur S S Gaur (Posted On: 06 May, 2014)

In this regard, we submit that although the definition of input service given in Rule 2(l) specifically includes services in relation to advertisement or sales promotion, still, recently, the Gujarat High Court has held in the case of COMMISSIONER OF CENTRAL EXCISE, AHMEDABAD – II Vs M/s CADILA HEALTHCARE LTD (2013-TIOL-12-HC-AHM-ST) that as regards commission paid to foreign agent, the said service is more directly related to sales rather than sales promotion and so does not comes within the ambit of the definition of ‘input service’. Accordingly, in order to claim credit on activities related to advertisement and marketing, it is necessary to prove that it is covered by the term sales promotion. It is also worth noting that Punjab & Haryana High Court, on the same issue, has opined in the case of COMMISSIONER OF CENTRAL EXCISE, LUDHIANA Vs AMBIKA OVERSEAS 2012 (25) S.T.R. 348 (P & H) that services provided by commission agents are covered under “sales promotion” and are pre-removal activities. Thus there lies an ambiguity in the fact that whether sales commission agent services fall under input services and whether the credit of the same be taken or not because there are two contrary judgments of high courts. This ambiguity shall continue until Supreme Court gives any decision or CBEC provides any clarification on this matter. {Query Replied by Ranu Dhoot}
Dear sir , A manufacturer is required to carry out basic sales and marketing activities for selling its product along with sales promotion like dealers meet , field trial etc . the basic sales and marketing activities are meant for selling its products . Therefore it is possible to argue that entire selling and marketing activities are for clearing its goods from the place of removal i e factory or godowns or subsequent sales promotion activities and are fully covered under the definition of input services and eligible for full cenvat credit .Kindly clarify whether this argument hold good in view of the fact sales commission agent services have not been treated part of input service in some of the recent judgement . thanks . ssgaur S S Gaur (Posted On: 06 May, 2014)

In this regard, we submit that although the definition of input service given in Rule 2(l) specifically includes services in relation to advertisement or sales promotion, still, recently, the Gujarat High Court has held in the case of COMMISSIONER OF CENTRAL EXCISE, AHMEDABAD – II Vs M/s CADILA HEALTHCARE LTD (2013-TIOL-12-HC-AHM-ST) that as regards commission paid to foreign agent, the said service is more directly related to sales rather than sales promotion and so does not comes within the ambit of the definition of ‘input service’. Accordingly, in order to claim credit on activities related to advertisement and marketing, it is necessary to prove that it is covered by the term sales promotion. It is also worth noting that Punjab & Haryana High Court, on the same issue, has opined in the case of COMMISSIONER OF CENTRAL EXCISE, LUDHIANA Vs AMBIKA OVERSEAS 2012 (25) S.T.R. 348 (P & H) that services provided by commission agents are covered under “sales promotion” and are pre-removal activities. Thus there lies an ambiguity in the fact that whether sales commission agent services fall under input services and whether the credit of the same be taken or not because there are two contrary judgments of high courts. This ambiguity shall continue until Supreme Court gives any decision or CBEC provides any clarification on this matter. {Query Replied by Ranu Dhoot}
Sir, While filing ER-6, we are disclosing only those raw materials which are excisable as well as contribute more than 10% cost. But previously we disclose all of such raw material which accounts for more than 10% cost. My query is whether dept. can issue notice for such change in practice? Also which concept is correct? RAJIV JAIN (Posted On: 05 May, 2014)

As per Rule 9A(3) of the Cenvat Credit Rules, 2004, every manufacturer is required to file monthly return giving information of the receipt and consumption of each principal inputs with reference to the quantity of final products manufactured by him. Further, principal input means any input which is used in the manufacture of final products where the cost of such input constitutes not less than 10% of the total cost of raw materials used in the manufacture of unit quantity of a given final product. It is submitted that it is nowhere specified that the raw materials to be disclosed should be excisable. Therefore, to be on safer side, it is better to show the consumption of all the principal inputs irrespective of the fact whether they are excisable or not. The revenue department may issue notice for change in the practise followed by you. Although, the notice will not have any financial implication except for penalty under Rule 27 of the Central Excise Rules, 2002 for contravention of the Rules. {Query replied by: CA Neetu Sukhwani & Ranu Dhoot}
change e.mail- how? SAILAPATI BHATTACHARYYA (Posted On: 04 May, 2014)

It is intimated that as registration on our website is free, therefore, you are simply required to register and create a new login on our website with your new email id. As soon as the new login is created, all the amendments, news, case laws etc. shall be sent to you on your new email id via our weekly newsletter. Further, if you wish not to receive the updates on your previous email id then you can unsubscribe the newsletter by clicking on the option ‘unsubscribe’ present at the end of the weekly newsletter. {Query replied by Prayushi Jain}
change e.mail- how? SAILAPATI BHATTACHARYYA (Posted On: 04 May, 2014)

It is intimated that as registration on our website is free, therefore, you are simply required to register and create a new login on our website with your new email id. As soon as the new login is created, all the amendments, news, case laws etc. shall be sent to you on your new email id via our weekly newsletter. Further, if you wish not to receive the updates on your previous email id then you can unsubscribe the newsletter by clicking on the option ‘unsubscribe’ present at the end of the weekly newsletter. {Query replied by Prayushi Jain}
Respected Sir, Hiring of bus for carrying employees from station to company is taxable under rent-a-cab service and if Service provider charges 12.36% service tax in the bill,so my query is 1.can we paid full amount of bill to service provider. 2. or paid only bill without service tax to service provider and take 60% abatement and 40% paid to department. (Posted On: 04 May, 2014)

ANS. Vide notification no. 30/2014-ST dated 20th june 2012, in Serial No. 7 of the Table given in the notification, it has been specified that, if: (a) In respect of services provided or agreed to be provided by way of renting of a motor vehicle designed to carry passengers on abated value to any person who is not engaged in the similar line of business, then 100% of the service tax liability shall be of service recipient. (b) In respect of services provided or agreed to be provided by way of renting of a motor vehicle designed to carry passengers on non abated value to any person who is not engaged in the similar line of business, service tax liability to the extent of 60% shall be of service provider and remaining 40% of the service recipient. However after the Budget of 2014 service tax liability of the service provider has been reduced to 50% and that of the service recipient has been raised to balance 50% (Vide Notification No. 10/2014-ST dated 11.07.2014). {Query replied by:-Ranu Dhoot}
Sir, We require an assembly which we get done from our small job worker. We are buying three types of inputs to make assembly from it and availing cenvat credit on the same. For assembly purpose we are sending these inputs to our job worker on 4(5)(a) chalan. While making assembly job worker utilizes his material i.e. some steel, fabrication material, etc and make the assembly. For this job he is raising two invoices one for service job done and another for material used by them and put in to together to make assembly duly charging excise duty. At the time of excise audit at job worker’s end, auditor has raised query that, excise should be charge on total material value involve plus profit element if any. While our job worker is charging duty on cost of material used by them plus his margin. Whether our jobworker need to pay duty on the value as suggested by excise auditor? Please guide. SACHIN (Posted On: 03 May, 2014)

It is submitted that under the provisions of Rule 4(5)(a), the job worker need not to pay the duty at all and principal manufacturer will pay the duty on the finished goods. Even if the some material has been used by job worker then also duty is not payable. Even the Mumbai High Court has held in case of Sterlite Industries [2009 (244) ELT A89 (BOM)] that the credit inputs used by job worker will be allowed as the principal is paying duty ultimately on the finished goods. Moreover, if the principal takes permission to clear the goods from premises of job worker on payment of duty under Rule 4(6) then also the liability to pay duty will be of principal only. Even in case of such permission, the normal procedure prescribed by the department is that the principal will prepare the invoice and leave the date and time of removal blank. He will send "original for buyer" and Duplicate for transporter" copy of this invoices to job worker. He will fill the date and time of removal will clearing the goods and tell the same to principal manufacturer. He will also fill the same in "triplicate for assessee" copy of invoice. {Query replied by:- CA Neetu Sukhwani & Prayushi Jain}
Dear Sir, I have doubt about camera hiring comes under which service tax head Nisa (Posted On: 30 Apr, 2014)

Prima facie, the act of camera hiring would come under the category of “supply of tangible goods service” wherein the taxable service has been defined as any service provided or to be provided to any person in relation to supply of tangible goods including machinery, equipment and appliances for use, without transferring right of possession and effective control of such machinery, equipment and appliances. {Query replied by Prayushi Jain}
Respected sir, I have received a bill for car hire charges without charging service tax on it, under rent a cab scheme. so my query is 1. at what rate we have paid the service tax to department. or 2. can we take credit of service tax what we paid to the department. Deepak Dalvi Deepak Dalvi (Posted On: 30 Apr, 2014)

The reverse charge mechanism is applicable to rent-a-cab service if the service provider is individual, HUF, partnership firm (registered or not) including AOP and service recipient is a body corporate. Further, the extent of liability of service tax for service provider and service recipient has been specified in the notification no. 30/2012-ST dated 20.06.2012. The present rate of service tax is 12.36% while an abatement of 60% is available for renting of any motor vehicle designed to carry passengers vide notification no. 26/2012-ST dated 20.06.2012 subject to the condition that cenvat credit of inputs, capital goods and input services used for providing the taxable service has not been taken under the Cenvat Credit Rules, 2004. The credit of service tax paid on “rent a cab” is not available in view of specific exclusion clause in the definition of "input service" in Rule 2(l) of Cenvat credit Rules, 2004 which is produced as follows:- “excludes services provided by way of renting of a motor vehicle in so far as they relate to a motor vehicle which is not a capital goods”.
Respected Sir, Company is hiring bus for carrying employee from station to company, so is this service covered under rent a cab service. and if yes then what will be the percentage of paying service tax to department or can we take credit of ST after making payment. Deepak Dalvi (Posted On: 29 Apr, 2014)

Hiring of buses for employees is taxable under rent-a-cab service. The prevailing rate of service tax is 12.36% but abatement of 60% may be availed in that case, the service tax will be payable @4.944%. The credit of service tax paid on “rent a cab” is not available in view of specific exclusion clause in the definition of "input service" in Rule 2(l) of Cenvat credit Rules, 2004 which is produced as follows:- “excludes services provided by way of renting of a motor vehicle in so far as they relate to a motor vehicle which is not a capital goods”.
Respected Sir Our client is taking services of electrical work in relation of installation of New Rice Plant. Kindly guide that will it be covered under the definition of clause of (e) of item no: 14 of notification no: 25-2012. Thanks with due regard CA Praveen Bansal Mathura (Posted On: 27 Apr, 2014)

We submit that the service of electrical work in relation of installation of new rice plant shall not be exempted. In the mega exemption notification 25/2012 clause of (e) of item no: 14 provides exemption to mechanised food grain handling system, machinery or equipment for units processing agricultural produce as food stuff excluding alcoholic beverages. But as said by our finance minister, rice is not considered as agricultural product therefore the exemption to rice plant is not available. Further with the interim budget the finance minster has granted the exemption to loading, unloading, packing, storage or warehousing of rice. Moreover after it a clarification was issued as regards to non leviability of service tax on its transportation also. But as the service in this question is of installation of rice plant, therefore it shall be taxable. We also submit that the definition of the “agricultural produce” is given as any produce of agriculture on which either no further processing is done or such processing is done as is usually done by a cultivator or producer which does not alter its essential characteristics but makes it marketable for primary market. Accordingly, it has been held that rice is not an agricultural produce because it is being processed in mills. {Query replied by Prayushi Jain}
Dear Sir, I have a query specifically on leviable of Service tax on "Fabrication" work at customer's premises which is an excisable area. 1. A job is awarded to a contractor, where both the customer and the contractor are public limited companies. 2. As per the contract awarded, there are two distinctive service components clearly spelt out in the order awarded to the contractor. 3. The first item being an erection & commissioning work to be done at the customer's site. The second item being a 'FABRICATION" work to be done by the contractor at the customer's plant(which is exciseable). The fabrication work will be done by the contractor on free issue materials to be provided by the customer which are structural items and hence partake that of 'capital' goods. 4. The opinion given as to the "Fabrication" work is that the same is not exigible to Service Tax since the same is deemed "manufacture" under Excise Duty and is to be charged Excise Duty under Section 3 of the Central Excise Act 1944 instead and here as the customer is the licensed unit under Excise Duty will be responsible for payment of Excise Duty after the fabrication work is done and the structurals are handed over to the customer. The matter presumably falls under the mischief of section 66D(f) (negative list) of the Finance Act 1994 and hence NO Service tax is to be charged on "Fabrication" work. This is true even if the excisable good is exempted under the Central Excise Act 1944. 5. However Service Tax will be charged by the contractor on the Erection and Commissioning part. 6. The first query is whether the contractor be allowed NOT to charge Service Tax as per point 4 above ? Please note the contractor is not registered as an excisable unit but is registered under Service Tax. 7. The second query is whether the contractor can avail any Input Credit on Service rendered to it by the contractor's sub-contractor on the same Fabrication job? I shall be grateful if you kindly forward your valued opinion. Regards Pravin PRAVIN SHELKE (Posted On: 27 Apr, 2014)

As the fabrication work done at customer’s plant is excisable therefore it shall not be charged to service tax by the contractor. The opinion received by you is accurate that the goods as are deemed manufacture than same shall be charged with excise and not with service tax. The process amounting to manufactured are exempted from payment of service tax by virtue of exemption contained in point (f) of Section 66D (negative list) of Finance Act, 1994. Hence the same shall not be taxable to service tax. As the contractor is not registered in excise law, he shall get registered as he is producing an excisable product. As the contractor is not registered in Excise law and not paying Excise duty then he cannot be eligible to take credit for the same. However, if he takes registration for fabrication work and pays duty then he is eligible for taking credit on input services relating to such fabrication work.
We are a logistics company providing services of moving materials from one place to another place. For this we need to keep one fork lift permanently at manufacturer place for loading purposes for which we collect service charges based on no. of hours used. The manufacturer says he will provide required diesel for the forklift. Contract is entered with us saying that diesel shall be provided by him. The contract value is exclusive of diesel cost. We would like to know whether ST is chargeable on cost of diesel also although the same was supplied by the recipient of service. Pl clarify R. Sadasivan (Posted On: 26 Apr, 2014)

No the service tax is not chargeable on the free supply of material provided by the service recipient as reading section 67 it is ample clear that the tax should be chargeable on the gross amount charged for service provided only. The landmark decision of Bhayana Builders PVT LTD {2013 (32) S.T.R. 49 (Tri. - LB)} clearly states that if the value of material is not included in the gross amount charged than it shall not form part of service provided and shall not be taxable. But the department is not accepting this decision and litigation is going on.
Dear sir, I sent u the query but I didn't get the reply that the client crossed the one crore duty in the year 2012-13 as he became liable to file ER-4,5,6 but in the year 2013-14 his total duty is Rs.75 lakhs then he becomes liable to file ER-4,5,6 Please reply. hitesh (Posted On: 26 Apr, 2014)

In respect of your query the client is not required to fill the ER-4, 5, 6 as in preceding year the duty was less than one crore rupees so there is no requirement of filling the returns. Notification N0.17/2006-CE(NT) dated 01.08.2006,exempts assessees who paid duty of excise less than Rs.1crore in the preceding financial year, from filing the ER-4 return. Similarly, Notification No.39/2004-CE (NT) dated 25.11.2004, exempts the specified class of manufactures who paid duty of excise less than Rs.1 crore in the preceding financial year, from filing ER-5 declaration and ER-6 return. Hence by readiing the notifications its ample clear that only return is to be submitted when the duty is more than one crore rupees in preceding financial year. Following the same, you have to file returns in 2013-14 but need not to file the same in next year if the duty payable in preceding financial year is Rs. 75 Lakhs.
Sir, Whether service tax is applicable on export of service to Nepal The payment will be received in Indain Rupees. Sudhakar Sawant (Posted On: 25 Apr, 2014)

Rule 6A of Service Tax Rules clearly says in clause (e) that the payment should be received in convertible foreign currency. Since this condition is not satisfied then it cannot be said as export of service. Hence the service tax will be applicable.
One of the NGO providing its premises for functions , marriage or for holding any events etc on rent basis . Its liability of service tax arises on rent since this is falling taxable service in the nature of renting premises other than leasing . Apart from rent for the premises it also charges for uses of electricity on actual consumption basis . Units are charged on actual usage as per the meter and rates as charged by electricity board rounded of to the nearest rupee . Service tax department is insisting that electricity recovery should also be subject to the service tax .Kindly advise whether electricity recovery on actual usage basis will also be subject to the service tax .In my view Electricity being goods and billed on actual usage basis should not be subject to service tax .thanks s S Gaur S S Gaur (Posted On: 25 Apr, 2014)

Looking on the facts Main service provided by us is provision of premises on rent and not provision of electricity therefore provision of electricity is reimbursement of expensese and not provision of service or cost incurred for provision of such services. In support of this the benefits of latest decision of INTERCONTINENTAL CONSULTANTS & TECHNOCRATS PVT. LTD. Versus UNION OF INDIA(2013 (29) S.T.R. 9 (Del.)) in which rule 5 of Service Tax (Determination of Value) Rules, 2006 has been quashed can be requested. This decision clearly states that for charging service tax provision of service has to be seen and not the costs taken by service provider from service receiver. However, the CBEC has clarified in its education guide on service tax that the distribution of electricity is exempt for electricity companies only. Even builders distributing electricity will be liable for service tax. But many of learned authors are of the view that the electricity is "goods" and not liable to service tax. One more point in your defence can be that we are not "distributing" electricity.
Sir we are telecom PSU we have to cancel or revise some port charges bills issued to pvt operators by reason of court orders.such cancellation/revision results in 1 crore of st excess paid. Can we adjust this amount under rule 6(3).Is there any time limit or monetary limit exists for such adjustment. NITIN SHARMA (Posted On: 25 Apr, 2014)

W.e.f. 1st April, 2011 Service tax Rule 6(3) is substituted, which reads as under: “Where an assessee has issued an invoice or received any payment, against a service to be provided which is not so provided by him either wholly or partially for any reason, or where the amount of invoice is renegotiated due to deficient provision of service, or any terms contained in a contract, the assessee may take the credit of such excess service tax paid by him, if the assessee:- (a) Has refunded the payment or part thereof, so received for the service provided to the person from whom it was received; or (b) Has issued a credit note for the value of the service not so provided to the person to whom such an invoice has been issued.” In your case cancellation or revision shall amount to renegotiation of invoice, thus you can adjust the excess service tax paid on the basis of Rule 6(3). Also, the rule nowhere mentions any time limit or monetary limit. Thus it is at your discretion when you take credit of the same provided you fulfill the conditions of rule.
Sir Wheather we can take credit of service tax charged by the laliit hotel, the amount shown as service tax on car rental @4.94% Ankit mittal (Posted On: 21 Apr, 2014)

The credit of service tax paid on “rent a cab” is not available in view of specific exclusion clause in the definition of "input service" in Rule 2(l) of Cenvat credit Rules, 2004 which is produced as follows:- “excludes services provided by way of renting of a motor vehicle in so far as they relate to a motor vehicle which is not a capital goods”.
Under which rule the valuation of goods (Central Excise Rules,2000) will be made if assessee sold goods but are used for consumption not by him or on his behalf in the production of other articles? Sandeep Shah (Posted On: 19 Apr, 2014)

The valuation is to be done as per section 4 of the Central Excise Act, 1944 and if it is not possible to value the excisable goods as per the transaction value as prescribed under the section 4 of the Central Excise Act, 1944, then only the valuation rules are to be resorted to. Rule 8 of the Valuation Rules is applicable where the excisable goods are not sold by the assessee but are used for consumption by him or on his behalf in the production or manufacture of other articles, the value shall be 110% of the cost of production or manufacture of such goods. As you say that the goods are being sold by you, first value should be determined as transaction value. If the transaction value cannot be determined then, the valuation Rules are to be resorted to.
i have a photocopier machine rented to DSP . I collect hire charges including 12.36% Service tax . I also appoint a person who handle the machine..can i pay 12.36% service tax to the deparment INDRANIL BISWAS (Posted On: 16 Apr, 2014)

According to section 73A of the Finance Act, once you collect any amount in the name of service tax, you are mandatorily required to pay it to the government.
Can You Please Provide the details Procedure & Eligibilty for the Refund of the Excise duty Paid on Vehicle registered as Taxi. Arpit (Posted On: 15 Apr, 2014)

Your query is not clear, please give in detailed manner so can we understand your query.
Sir, WE are reversing duty under rule 6 for exempted goods and service. But for this FY we fails to submit the intimation letter on 01.04.14. Can we submit the intimation letter now? Will department accept the intimation? RAJIV JAIN (Posted On: 15 Apr, 2014)

There is no time limit for intimating to department as per Rule 6(3A). However, normally, intimation should be given in the beginning of the year. You may now intimate the department.
Sir we are dealing in news paper as a dealer and take commission from our vendor for sale material on behalf of them.We just doing paper change activity.Sir as per our practice we have made the payment to vendor immediately against purchase but same payment has received from customer after some day.Due to the late payment we charged interest on them.but not charged service tax on that interest amount.As per department view its related to banking and financial service and its liable for serviceo tax.Please let me know whether stand taken by department is right. Rinkesh Motilal Jogad (Posted On: 14 Apr, 2014)

The stand of the department is wrong. As per negative list given under section 66D, clause (n) states that services by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount is not leviable to service tax. Moreover, the view that the banking and financial services are being provided by you is also totally misplaced because you are not bank or financial institution. Hence, no service tax is payable by you on the interest charged for delayed payment. {Query replied by CA Neetu Sukhwani}
Sir, Do we need to disclose the payment against Spot Memo in our monthly excise return ER-1. If yes, under which column? What if we do not disclose the said payment in the monthly return? RAJIV JAIN (Posted On: 10 Apr, 2014)

It is nowhere prescribed that the payment made against the spot memo is to be mandatorily disclosed in the ER-1 return. However, the assessee may show such payments under the category of “other payments” in the return if so desired.
Sir, While conducting Service tax audit, the dept. has issued spot memo on the basis of expenditure shown in the balance sheet book under accrual basis. But we discharge service tax liability under Reverse Charge Mechanism when actual payment is made to the provider. Pls advise how to deal. In reply we have submitted party wise ledger but still they issue SCN. RAJIV JAIN (Posted On: 07 Apr, 2014)

As per Rule 7(b) of Point of Taxation Rules, 2011 the service receiver is allowed to make payment under reverse charge mechanism on payment basis. But the proviso to rule 7 says that in case where such payment is not made within the six months of the date of invoice, the point of taxation shall be determined as per rule 3 of Point of Taxation Rules. If we are paying the service tax within six months then the practice followed is correct and tenable in law. We should submit the Reply to SCN and plead for the same in hearing. But if the payment of service tax under RCM has not been made for more than six months than we will be liable to pay service tax along with interest from the due date of payment determined as per rule 3 of Point of Taxation Rules, 2011. The date shall be 5th of the next month in which invoice is issued.
Dear Sir, We are manufacture of Beverages Product. We have sent some material (Resin i.e preform of preform) directly from supplier premises to Job worker premises, Job worker after processing (pet preform )that material, will send directly to us. On this material supplied by job worker we will do some further process and used it in packing (As a plastic bottle) of dutiable final product. I want to know that how job worker will raise his Invoice i.e. whether he will charge excise on total value of material or will charge excise on job work amount or he will charge service tax on the same. At the same what will be the treatment of excise charged by our supplier on his invoice which is named on us. Thanks in advance for your kind consideration. Reagrds Mahendra Modi mahendra modi (Posted On: 07 Apr, 2014)

On reading your query we came to a conclusion that the job work that is being done on resins which is an intermediate process that facilitates in the manufacture of your final product. If your final product is dutiable then you can send the goods under Rule 4(5)(a) of Cenvat Credit Rules, 2004 or under Notification no. 214/86-C.E. dated 25.3.86 as amended. If you follow this procedure then there is no need to pay excise duty by job worker. But if your final product is not dutiable then the leviability of excise duty on such intermediate process depends on the fact that whether goods produced by the job worker amounts to manufacture in terms of the provisions of Central Excise Act, 1944 or not. If the process undertaken by the job worker amounts to manufacture, then excise duty is payable by the job worker as per the provisions of Rule 10A of the Central Excise Valuation Rules otherwise the service tax will be applicable. It is also subject to exemption contained in serial number 30 of Mega exemption notification no. 25/2012-ST dated 20.06.2012 which is to be checked at your end.
Dear Sir, We are manufacture of Beverages Product. We have sent some material (Resin i.e preform of preform) directly from supplier premises to Job worker premises, Job worker after processing (pet preform )that material, will send directly to us. On this material supplied by job worker we will do some further process and used it in packing (As a plastic bottle) of dutiable final product. I want to know that how job worker will raise his Invoice i.e. whether he will charge excise on total value of material or will charge excise on job work amount or he will charge service tax on the same. At the same what will be the treatment of excise charged by our supplier on his invoice which is named on us. Thanks in advance for your kind consideration. Reagrds Mahendra Modi MAHENDRA MODI (Posted On: 07 Apr, 2014)

On reading your query we came to a conclusion that the job work that is being done on resins which is an intermediate process that facilitates in the manufacture of your final product. If your final product is dutiable then you can send the goods under Rule 4(5)(a) of Cenvat Credit Rules, 2004 or under Notification no. 214/86-C.E. dated 25.3.86 as amended. If you follow this procedure then there is no need to pay excise duty by job worker. But if your final product is not dutiable then the leviability of excise duty on such intermediate process depends on the fact that whether goods produced by the job worker amounts to manufacture in terms of the provisions of Central Excise Act, 1944 or not. If the process undertaken by the job worker amounts to manufacture, then excise duty is payable by the job worker as per the provisions of Rule 10A of the Central Excise Valuation Rules otherwise the service tax will be applicable. It is also subject to exemption contained in serial number 30 of Mega exemption notification no. 25/2012-ST dated 20.06.2012 which is to be checked at your end.
Dear Sir, We are manufacture of Beverages Product. We have sent some material (Resin i.e preform of preform) directly from supplier premises to Job worker premises, Job worker after processing (pet preform )that material, will send directly to us. On this material supplied by job worker we will do some further process and used it in packing (As a plastic bottle) of dutiable final product. I want to know that how job worker will raise his Invoice i.e. whether he will charge excise on total value of material or will charge excise on job work amount or he will charge service tax on the same. At the same what will be the treatment of excise charged by our supplier on his invoice which is named on us. Thanks in advance for your kind consideration. Reagrds Mahendra Modi MAHENDRA MODI (Posted On: 07 Apr, 2014)

On reading your query we came to a conclusion that the job work that is being done on resins which is an intermediate process that facilitates in the manufacture of your final product. If your final product is dutiable then you can send the goods under Rule 4(5)(a) of Cenvat Credit Rules, 2004 or under Notification no. 214/86-C.E. dated 25.3.86 as amended. If you follow this procedure then there is no need to pay excise duty by job worker. But if your final product is not dutiable then the leviability of excise duty on such intermediate process depends on the fact that whether goods produced by the job worker amounts to manufacture in terms of the provisions of Central Excise Act, 1944 or not. If the process undertaken by the job worker amounts to manufacture, then excise duty is payable by the job worker as per the provisions of Rule 10A of the Central Excise Valuation Rules otherwise the service tax will be applicable. It is also subject to exemption contained in serial number 30 of Mega exemption notification no. 25/2012-ST dated 20.06.2012 which is to be checked at your end.
Dear Sir, We are manufacture of Beverages Product. We have sent some material (Resin i.e preform of preform) directly from supplier premises to Job worker premises, Job worker after processing (pet preform )that material, will send directly to us. On this material supplied by job worker we will do some further process and used it in packing (As a plastic bottle) of dutiable final product. I want to know that how job worker will raise his Invoice i.e. whether he will charge excise on total value of material or will charge excise on job work amount or he will charge service tax on the same. At the same what will be the treatment of excise charged by our supplier on his invoice which is named on us. Thanks in advance for your kind consideration. Reagrds Mahendra Modi MAHENDRA MODI (Posted On: 07 Apr, 2014)

On reading your query we came to a conclusion that the job work that is being done on resins which is an intermediate process that facilitates in the manufacture of your final product. If your final product is dutiable then you can send the goods under Rule 4(5)(a) of Cenvat Credit Rules, 2004 or under Notification no. 214/86-C.E. dated 25.3.86 as amended. If you follow this procedure then there is no need to pay excise duty by job worker. But if your final product is not dutiable then the leviability of excise duty on such intermediate process depends on the fact that whether goods produced by the job worker amounts to manufacture in terms of the provisions of Central Excise Act, 1944 or not. If the process undertaken by the job worker amounts to manufacture, then excise duty is payable by the job worker as per the provisions of Rule 10A of the Central Excise Valuation Rules otherwise the service tax will be applicable. It is also subject to exemption contained in serial number 30 of Mega exemption notification no. 25/2012-ST dated 20.06.2012 which is to be checked at your end.
Sir If any individual has taken registration as management consultant and paying service tax on it and at the same time he is generating income on rent then he is liable to pay service tax on rent income also? Surbhi (Posted On: 02 Apr, 2014)

As you are paying service tax on the services of management consultancy, it appears that the taxable value of the services is more than the small scale service provider exemption limit. It is submitted that an assessee may provide more than one services and in such a case, assessee is required to pay service tax on all the services rendered by him. As the service of renting of immovable property is being provided by you, you are liable to pay service tax. However, renting for residential purposes is exempt if the declared tariff of a unit of accommodation is below Rs. 1000 per day as specified in mega exemption notification no. 25/2012-ST dated 20.06.2012. It is also worth observing that the taxable value of all the services provided is to be considered while computing the benefit of small scale service provider exemption benefit. We cannot claim small scale service provider exemption separately for each service.
I am Business entity earning interest income from financing and/or doing trading activity. I paid fees to adv. Is it that I will be liable to pay service tax on adv. fees under reverse charge only if I have turnover of more than 10 lacs from taxable services? In this connection I draw your attention to para 66.3-1 and 66.4-2 of S.S. Gupta 35th Edition (Page1084 and 1085) Pl. consider his interpretation in para 66.3-1 under the heading "conclusion" and "value of exempt services also forms part of "turnover". Interest income earned by me is not taxable as the same is in negative list. Other service income are less than 10 lacs. Interest income and/or trading activity is more than 10 lacs. Whether I am liable for service tax under reverse charge on adv. fees SANJAY BOBRA (Posted On: 01 Apr, 2014)

The legal service of an advocate or advocate firms shall fall under reverse charge mechanism if the service provider is individual advocate or advocate firms and where service receiver is business entity having turnover exceeding Rs 10 lacs per annum, located in a taxable territory. For the purpose of Reverse Charge Mechanism, “Business entity” means any person ordinarily carrying out any activity relating to industry, commerce or any other business or profession-SECTION 65B(17) OF FINANCE ACT,1994. There is no definition of turnover provided in the Act. Thus, turnover shall be interpreted in general terms with no exclusion of the services covered under negative list. Thus, in your case as the interest income and/or trading activity is more than 10 lacs, you are liable to pay service tax under reverse charge mechanism on advocate fees.
Expert openion pm handling,exporting rice is exempted from service tax as paddy is an agricultural produce and primary market item but rice is not the same TSSASTRY (Posted On: 01 Apr, 2014)

Sir, your query isn’t clear enough so as to give you an exact answer. As per our understanding your query is whether service tax is leviable on handling of rice that is to be exported. The mega exemption notification no. 25/2012 has been amended wherein with effect from 17th February, 2014 Entry No 40 has been inserted in the aforesaid notification which gives exemption from levy of service tax on services by way of loading, unloading, packing, storage or warehousing of rice. As such, the handling of rice is exempted from service tax even if it is not specifically covered by the definition of agricultural produce w.e.f. 17.02.2014. {Query replied by: Ranu Dhoot}
Sir, We are the casting manufacturing industry and for manufacture of cstings sand mould is necessary. For sand mould preparation sand plant machines such as Sand mixer, Belt conveyor, screw feeder, Sand hopper etc equipments/machinery is necessary. The beams, angles and channels purchased and used for to run the equipments/machinery and availed cenvat credit in RG23C .Department says the angles, channels are not eligible cenvat credit under capital goods as the tariff mentioned under 73 chapter.Request your valuable advice. K.Srinivasan (Posted On: 31 Mar, 2014)

The Cenvat credit on angles, channels shall be allowed if these form an integral part of the machine in form of an accessory, component or spare. However Cenvat credit shall be disallowed if the angles, channels etc are used in making supporting structure. Since in your case the beams, angles and channels purchased are used for running the equipments/machinery, hence Cenvat Credit on the same is allowable.
TOTAL TRANSPORT CHARGES IS 80000/- PA, ON RECEIPIENT WHETHER I HAVE TO SERVICE TAX PAYABLE rajesh dayalji mistry (Posted On: 31 Mar, 2014)

We are unable to understand your query as it is not properly drafted. However, we are providing you with the provisions of taxability of service tax in case of GTA. In case of GTA, the liability under reverse charge arises on the service recipient when the service is provided by a goods transport company that issues consignment note and the consignor or consignee is covered by the list of specified persons. In such a case, the person who pays or is liable to pay freight shall be liable to pay service tax. The consignor or consignee should be any of the following:- • Factory registered under Factories Act,1948 • Society registered under Societies Registration Act, 1948 or under any law corresponding to that Act in force in any part of India • Any co-operative society established by or under any law • registered dealer of excisable goods • Any Body corporate established by or under any law • Partnership firm (whether registered or not) or AOP. We also submit that in case of reverse charge mechanism there is no benefit of SSI Exemption. Service tax under reverse charge is payable on each and every transaction.
Sir, if the repairing of fan motor is taxable service under rev.charge as a "reaping service" than we should calculate S.Tax on 60% or 70% of gross value, request to pls. give ur suggestion in this regard. Thanks P.S.Butola P.S.B (Posted On: 31 Mar, 2014)

Motor fan is a movable property and “electric fan motor rewinding” would be covered under works contract service because the repairing of fan would involve both material and labour. Reverse charge on repair movable property is applicable, if the service provider is Individual/HUF/FIRM/AOP and service recipient is a company. Hence Service tax @ 70% shall be chargeable on the gross value of repairing of fan motor. Although, liability of service recipient is only 50% of the service tax and 50% of the service tax would be paid by the service provider.
Sir ji.. I need clarification on the following: a) Interest paid on loan received from bank located outside India is taxable in India? b) Interest received from foreign subsidairy is taxable in India? Pl. clarify.. this is a grey area where actual services can be converted to non-services visuiyer (Posted On: 30 Mar, 2014)

Interest consideration is not leviable to service tax in view of the clause (n) of section 66D pertaining to the negative list. It has been provided in the negative list that services by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount is not leviable to service tax. Hence, when no service tax is leviable, the question of analysing the provision of reverse charge mechanism does not arise.
Is Excise duty applicable on bakery products produced in restaurant?? Suman Jaisinghani (Posted On: 30 Mar, 2014)

Excise duty is levied on the basis of the product no matter where it is produced. Bakery products fall under the chapter heading 1905 of Central Excise Tariff Act and hence liable to appropriate excise duty as per the said chapter heading.
Sir ji.. can u please calrify the cenvat on capital goods vs. depreciation considered in the financial statement. under what circumstances the cenvat input will be disallowed on capital goods visuiyer (Posted On: 29 Mar, 2014)

According to Rule 4(4) of Cenvat Credit Rules, 2004 “The CENVAT credit in respect of capital goods shall not be allowed in respect of that part of the value of capital goods which represents the amount of duty on such capital goods, which the manufacturer or provider of output service claims as depreciation under section 32 of the Income Tax Act, 1961 (43 of 1961) “ Therefore, if credit of duty paid on capital goods is availed, then depreciation on the duty portion cannot be claimed in Income Tax Act because it would amount to taking double benefit.
sir, "electric fan motor rewinding" is taxable service under RCM. P.S.B (Posted On: 28 Mar, 2014)

It will come under repairing service and hence taxable.
Sir If any service bill is raised in F.Y. 2012-13 and at the time of payment the receiver is telling that he will not pay full amount. so can we raised the credit note against that bill in f.Y. 2013-14 Surbhi (Posted On: 27 Mar, 2014)

Yes, it can be done. The Rule 6 (3) also supports the same. If the service tax is paid then it can be adjusted in next quarter. There is no difference if the financial year is changed.
dear sir , if we take credit of service tax. It is compulsory to pay service tax on labour bill (no limit cross) MANISHA (Posted On: 26 Mar, 2014)

There is no option to take the credit with the assessee. If the output service is taxable then one can take credit. However, if you are claiming the threshold exemption under notification 6/2005 then also this benefit will be forgone since you have taken the credit.
Sir ji.. Is supply of manpower by corporate entity to Government department is taxable or not. What is the status in case of non corporate for payment under Reverse Charge Mechanism visuiyer (Posted On: 26 Mar, 2014)

The activity of supply of manpower to government department does not find mention in either negative list or the mega exemption notification. Hence, it is a taxable service. As far as liability under reverse charge mechanism is concerned, the same arises if services are provided by any individual, HUF, proprietor or partnership firm, AOP located in taxable territory to business entity registered as body corporate. {Query replied by: Ranu Dhoot}
sir, does CST is levied on freight charges..?? please revert as soon as possible. YOGESH BHARDWAJ (Posted On: 24 Mar, 2014)

We are not dealing in sales tax matters. Hence we will not be able to reply. We are dealing in Central Excise, customs, DGFT and service tax.
Sir, a company is rendering services of liasoning to obtain licenes and permissions under various laws to their client to establish a business unit. For eg. municipality permissions, land permissions etc., May I know the classification and category of these services for taking registration under service tax. Thank you sir. CA. C V SURYAM (Posted On: 23 Mar, 2014)

Since it is not covered under Negative list or under Megha exemption notification then it is chargeable to service tax. It may come under BSS service.
XYZ (Partnership Firm) is a authorised dealer for 2 and 4 wheeles oil dealer ,XYZ purchase Oil from its supplier and sale to its Dealer & customer. In addition to the regular profit on sale of oil, XYZ also received incentive on yearly basis from its supplier which depends on achievement of sales target as decided and intimated by its supplier from time to time. My question is whether such incentive received is taxable under service tax act and under which category. Sandip Patil (Posted On: 22 Mar, 2014)

Since you are authorized dealer and not an agent, hence you are purchasing the oil and selling it on your own behalf. The incentive given to you is in actual is discount only. There is no service tax on such discount. Only by saying it "incentive", it will not be chargeable to service tax.
Sir if the company raised the bill to its sister concern for the use of common generator than applicability of service tax arised or not Surbhi (Posted On: 21 Mar, 2014)

Since it is for use of common generator, this will fall under right to use tangible asset. Moreover, the sister concern is retaining the control and supervision of the generator then it is liable to service tax.
Sir, We are manufacturer of Pig Iron. This is sold locally as well as through Consignment Agents. At the time of dispatching goods from factory to consignment agents we pay excise duty on the price prevalent at that time at agent place. The agent received goods after 4-5 days through truck and sold at the same price.But by that time sale price might change at principal factory. Now department asking for the excise duty on the difference of basis price. Kindly suggest. RAJIV JAIN (Posted On: 20 Mar, 2014)

Rule 7 of Valuation Rules are very clear and you are paying duty rightly. There is no force in the department of demanding the differential duty.
DEAR SIR PLZ LET ME KNW OUR COMPANY HAS AVAILED SERVICE TAX CREDIT ON CIVIL CONSTRUCTION WORK DONE AT FACTORY / FACTORY BUILDING ON THE BASIS OF INPUT SERVICE TAX DEFINITION " CENVAT CREDIT AVAILABLE FOR BUSINESS RELATED ACTIVITY SUCH AS MODERNIZATION , RENOVATION , REPAIR AND MAINTENANCE ON FACTORY BUILDING " BUT RECENTLY EA AUDIT HAS BEEN CONDUCTED IN OUR FACTORY AUDITOR ASKED US REVERSE CENVAT CREDIT AVAILED ON CIVIL CONSTRUCTION WORK HAS MENTIONED BUDGET 2011-12 W.E.F 01-04-2012 IS IT CORRECT PLZ LET ME KNW UMESH BORA (Posted On: 19 Mar, 2014)

The contention of audit is correct. The definition of "input service" has undergone a change and construction service is specifically excluded from the definition of "input service".
DEAR SIR WE ARE "A" ENGAGED MANUFACTURING OF 39 CHAPTER GOODS PACKING BOXES WE HAVE SOLD OUR MATERIAL TO PARTY "B" AFTER CHARGING EXCISE DUTY IN INVOICE NOW OUR PARTY "B" HAS TO AVAIL BENEFIT OF EXCISE DUTY REFUND WHICHEVER CHARGED BY US PARTY "B" WENT FOR FILE TED REFUND AT THEIR DGFT HYDERABAD , THEIR DGFT HAS NOT ENTERTAINED TED REFUND HENCE PARTY "B" REQUESTED US TO CLAIM TED REFUND AT "A" EXCISE DIVISION OFFICE IS IT POSSIBLE NOTE:- WE MANUFACTURER "A" HAS AVAILED CENVAT CREDIT ON RAW MATERIAL MY POINT IS IT POSSIBLE TO MANUFACTURER TO FILE TED REFUND AT THEIR EXCISE DIVISION AND TED REFUND AVAILABLE IF MANUFACTURER HAVE ALREADY AVAILED CENVAT CREDIT ON RAW MATERIAL UMESH BORA (Posted On: 19 Mar, 2014)

Firstly, you can also file the TED refund if disclaimer is given by other party. But it is to be filed with the DGFT as per chapter 8 of Foreign trade policy. It cannot be filed with Central Excise department. Regarding second query, the only condition is that the recipient should not claim the Cenvat credit. There is no embargo to claim credit by supplier for TED refund.
e are presently claiming AIR duty draw back on the exports as per Notification no 98/2013-Cus (NT) dated 14.09.2013. Can we also claim Service Tax refund on the services availed for export of goods as per Notification 41/2012-ST dated 29.06.2012 apart from claiming draw back as mentioned above. Pl clarify. rgds o.v. srinivasan gokak textiles ltd O V Srinivasan (Posted On: 17 Mar, 2014)

This query is already answered that both are permissible.
Dear Pradeepjee, Some of the restaurants are charging service tax @ 4.944% on total bill amount in the case of parcel food (take away) in addition to VAT. So, does food parcels attract service tax sir? CA. C V SURYAM (Posted On: 16 Mar, 2014)

Firstly, the supply of food parcels is not covered by the outdoor catering services that constitutes 60% taxable value as the food is prepared in the restaurants itself. As such, the same is usually classified under restaurant services constituting 40% as the taxable value. Actually, there is ambiguity as regards service tax liability on food parcels and the restaurants to be on safer side, charge service tax from the customers because the ultimate burden of service tax is on the customer. On interpreting the provision as regards leviability of service tax on restaurants, assessee may contend that no service tax is to be payable on food parcels as it is mere sale and do not involve any service element. However, revenue department may object the non-payment of service tax on food parcels on the contention that delivering food parcels at homes amounts to rendering of service. Hence, the restaurants usually charge the service tax to avoid litigation.
WHEATHER GREY CLOTH MFG.DONE JOB WORK HE APPLICABLE OF SERVICES TAX AND WHAT AMOUNT OF SERVICES TAX LIMIT APPLICABLE mohan g chugh (Posted On: 15 Mar, 2014)

There is no service tax on intermediate production process as job work of textile processing is exempt by clause 30(a) of Megha exemption notification.
Please advice exporter are eligible to claim refund under both notification 41/2012-ST AND AIR duty drawback under Notification 98/2013-Cus ( NT )or has to claim under only one notification. O V Srinivasan (Posted On: 14 Mar, 2014)

There is no bar on simultaneously availing the refund under Notification 41/2012-ST along with duty drawback 98/2013-Cus (NT). There are two option under 41/2012 for claiming the refund of service tax. Either it can be claimed from the Central Excise department on actual basis or from the custom department at fixed rate notified in this notification itself. But the drawback will be allowed in addition to either of these benefits under 41/2007.
May I know the effect of the recent circular no.176/2/2014 dt.20/01/2014 regarding discharge certificate and cenvat credit utilization. Sir, there was no such restriction earlier when VCES was introduced. Does it mean that an assessee who availed VCES is not eligible to use accumulated cenvat credit balance against tax payable from January 13 onwards? Or is this circular applicable to service receivers? Eg. A provided service to B duly charging service tax in invoice. B availed the cenvat on the strength of this invoice since he paid entire amount of bill with tax to A. Now A gone for VCES since he had not paid tax at all earlier. How does B know all this and reverse the credit taken earlier and now take credit again after paying the balance 50% of tax by A? As per my understanding, this circular is applicable to service providers either not registered at all earlier or not charged tax though registered. In such case only, waiting by service receivers till the service provider pays entire amount of tax under VCES to avail cenvat credit will be applicable. CA. C V SURYAM (Posted On: 14 Mar, 2014)

Your view is totally correct. If the service provider has charged the service tax in his bill and the service recipient has paid the same to him then such recipient will not know whether the service tax has been paid by the supplier or not? Then the service tax cannot be disallowed to service recipient. But if a service provider has not charged the service tax from recipient and raises the supplementary invoice afterwards and tells him that he has filed the declaration in VCES then the service recipient can take the credit only after the whole amount of tax has been paid by service provider.
under circular no. 123/5/2010 TRU 1) lying of cables under and along side road shifting of overhead cables for renovation of roads 2) lying of electricals cables between greeds / sub stations / transpormers and 3) lying of electricals cables upto distribution point of residential or electricals complex were out of the perview of service tax The above circular was recind from 1-7-2012 due to negative list regime kindly let us know whether above work are still exempted under service tax under new provision applicable from 1-7-2012 if yes, kindly let us know the relevant circular or notification vedraj agarwal (Posted On: 12 Mar, 2014)

Under the negative list tax regime, all services except those specified in negative list or mega exemption notification are taxable. As the activity of laying of electrical cables are not specified in negative list and the mega exemption notification, the same is taxable to service tax after 1.7.2012. Moreover, as the above cited circular was issued under the positive list scenario, it does not has relevance in the context of present service tax laws. However, only activities relating to shifting of overhead cables for the purpose of renovation of roads may be exempt from the levy of service tax as in mega exemption notification, serial no. 13 exempts services provided by way of construction, errection, commissioning, installation, completion, fitting out, repair, maintenance, renovation or alteration of road, bridge, tunnel etc. Hence, if the shifting of overhead cables is for renovation of roads, only then it is specifically exempted.
Dear Sir, Please guide, Whether Service tax is applicable on providing godown for storage of Rice and Corn. Balakrishna (Posted On: 11 Mar, 2014)

If these two falls under the definition of "agricultural produce" then the exemption will be available. The Finance minister has clarified that "rice" does not fall in the definition of "agricultural produce" and only paddy falls under the same. A separate exemption is given for rice by notification 4/2014.
Respected Sir, As per Circular No. 173/08/2013-ST, if goods are sold on MRP basis they have to be excluded from total amount for the determination of value of service portion. Now my query is that whether service tax would be applicable if liquor, mineral water etc are sold more than their MRP in restaurants and bar. Thanks & Regards, Ramesh Purbia RAMESH PURBIA (Posted On: 11 Mar, 2014)

Yes. The circular also means that. The analogy is that the amount charged over and above the MRP is for services only.
Respected sir, One of my client is providing restaurant services.the abatement available is 60%, so we pay tax on only 40 percent amount and rest of the amount is not taxable.so my question is that whether reversal of cenvat credit applies in case of restaurant services. If yes then whether it applies to all services on which abatement is available? Thanks & Regards Ramesh Purbia RAMESH PURBIA (Posted On: 10 Mar, 2014)

This is very typical issue. Actually, this is not abatement. Its value has been reduced under Valuation Rules. Most of leading hotels are treating it as exempted service and reversal is being done on the same. But for other abatement, such condition does not apply. Like for abatement under room service, it is clearly written that the credit on only "input" will not be allowed. Hence the credit on input service is allowed. If one see the definition of "exempted service" in 2(e) of CCR, 2004 it says that only those services where the abatement is allowed on the condition that no credit on input and input service is allowed. But credit of input service is allowed for "room accommodation" as said earlier. Hence, it will not be treated as exempted service and hence no need of reversal.
Sir, Greetings!!! Our client is a manufacturer of Chimney for Agro Waste Boilers (Energy Saving Device). The chimney is cleared from the client factory to a Rice Mill, who is going to Install a Agro Waste Boiler. The mill purchased Boiler from a diff. vendor and we supply only chimney to the Rice mill which falls under HSN 84029090. My view is,the company which clears chimney is eligible to claim exemption as per Noti.12/2012, S.No.332, List 8 - clause(16)&(21). Is my understanding is correct? Ganesh Prabhu (Posted On: 09 Mar, 2014)

This is technical issue and has to be verified on the factual position. If you are able to prove that your product is a part of Agricultural, forestry, agro-industrial, industrial, municipal and urban waste conversion device producing energy then you can get the exemption.
Imported capital goods (m/c spaers),spaers should cleared AS SUCH pl guide thanks in advance Ganesh Wanjarkhedkar Wanjarkhedkar G D (Posted On: 09 Mar, 2014)

The query is not clear. But we understand that you intend to know the procedure of clearance of capital goods from the factory. It has to be cleared under the cover of Rule 11 invoice. Normally, the depreciation @ 2.5% per quarter is allowed on the same. But if the goods are cleared as waste and scrap then duty is to be paid on transaction value. In case the goods are cleared in same year in which it is purchased then one can take the balance 50% of credit and then reverse the credit on clearance of capital goods.
Dear Sir, Please explain the procedure for TED Refund along with list of documents and where it has been file ( whether with DGFT OR at EXCISE DIVISION OFFICE )( Umesh Bora (Posted On: 08 Mar, 2014)

Chapter 8 of FTP prescribes the TED refund for deemed exports. It will be allowed by DGFT. You have to file the Application ANF 8. The list of documents are also given at the end of ANF 8 which is available on DGFT website.
we adopted VCES scheme for certain period and file the return of remaining period. now there is service tax audit team demanding documents related to VCES scheme. can we denies from providing documents and if they say these documents related to another period also and for audit purpose we have to check all document than we have to provide or not there is any circular MUKESH RATHI (Posted On: 06 Mar, 2014)

This is typical issue. As per VCES scheme also, no proceedings shall be initiated by the department under this scheme. Audit is also a type of proceeding. When the immunity from proceeding is provided then audit should not be conducted. We have also made the representation to the department but no result has come. The audit wing is regularly conducting of units who have opted for VCES.
Sir, If we are covered by compounded levy scheme and wish to issue excise invoice, how do we charge the excise duty in the invoice? Alok Agarwal (Posted On: 05 Mar, 2014)

Under Compounded levy scheme, there is no exemption from Rule 11 and hence the invoice is to be issued for clearing goods from registered factory. But the duty need not to be charged in the invoice. At the most, you can write that the unit is operating under compounded levy scheme.
Dear Sir, We are register dealer of central excise. We imported as well as domestic purchase raw material and take a cenvat credit in RG-23D register and we issued excisable invoice to consignee. And we file quarterly return. My Question is that : Do We required new addition registration as “importer” as per Notification no 10/2014 CE(NT) dated 28-02-2014 wef 01-04-2014 pritesh (Posted On: 05 Mar, 2014)

The main intention of adding “importer” in Rule 9 of the Central Excise Rules, 2002 is to ensure that the importer who issues cenvatable invoice also takes registration. When you are already registered dealer of excisable goods, and you are eligible to issue cenvatable invoices, you are not required to again take registration as “importer” unless and until you issue cenvatable invoices in the capacity of importer.
SIR, PL LET ME KNOW THE SERVICE TAX RATE ON ROOM ACCOMODATION & RESTAURANT. WE HAVE PROVIDING FOOD TO ROOM GUEST- PL LET ME KNOW THAT SERIVCES TO ROOM ARE FEE OF S.TAX. WE ARE ALSO PROVIDE HALL TO VARIOUS FUNCTION I.E. MARRIAGE, CONFERANCE ETC. HOW MUCH S.TAX WE HAVE TO CHARGE IN BILL ON THESE SERVICES. KINDLY ADVICE KAILAS (Posted On: 03 Mar, 2014)

The service tax is to be charged on 60% of taxable value. Rest 40% is abatement. In Restaurant, you have to pay the service tax 40% of billed amount. As per interpretation, the service tax is payable on food served in rooms also with effect from 1.7.2012. The providing of hall for social or business functions will fall under "Mandap Keeper" facility and the service tax is payable on 70% of billed amount. The rest 30% is abatement available for this service.
dear sir we are engaged in manufacturing of chap 27 % 28 products ( in this chapter heading packing & labeling considered as manufacturing activity or not) Umesh Bora (Posted On: 03 Mar, 2014)

As per chapter note 4 of chapter 27, for lubricating oils and lubricating preparations falling under Chapter 2710, labeling and packing will amount to manufacture. Further, as per Chapter note 9 of chapter 28, all the products of this chapter will fall under the definition of "deemed manufacture".
Respected Sir, One of my client has received the following services during the construction of a Hotel. a) Accounting Service, b)Advertisement Service, c)Architect Service, d)Auditing Service, e)Clearing & forward Agent Service, f) Security service, g) Consulting engineering service, h) Erection, commissioning or installation service, i) Information technology software service, j) Labour contractor service, k) Manpower recruitment and supply service and l) work contract service. Whether he can avail Cenvat credit on service tax paid by him on the aforesaid services during the construction of hotel? Thanks & Regards, CA. Ramesh Purbia RAMESH PURBIA (Posted On: 01 Mar, 2014)

The credit of the above services may be availed by your client even if these are being availed during the construction of the hotel and your client has not started providing taxable output service. This is based on the decision given in the case of AMBATTUR DEVELOPERS PVT LTD. Vs. COMMISSIONER OF SERVICE TAX, CHENNAI [2014-TIOL-242-CESTAT-MAD] wherein it has been held that when the credit of duty paid on capital goods is allowed even much before they are put to use, the denial of credit on the contention that no output service was provided during the credit availment period is not justifiable.
Respected Sir, One of my client has received the following services during the construction of a Hotel. a) Accounting Service, b)Advertisement Service, c)Architect Service, d)Auditing Service, e)Clearing & forward Agent Service, f) Security service, g) Consulting engineering service, h) Erection, commissioning or installation service, i) Information technology software service, j) Labour contractor service, k) Manpower recruitment and supply service and l) work contract service. Whether he can avail Cenvat credit on service tax paid by him on the aforesaid services during the construction of hotel? Thanks & Regards, CA. Ramesh Purbia RAMESH PURBIA (Posted On: 01 Mar, 2014)

The credit of the above services may be availed by your client even if these are being availed during the construction of the hotel and your client has not started providing taxable output service. This is based on the decision given in the case of AMBATTUR DEVELOPERS PVT LTD. Vs. COMMISSIONER OF SERVICE TAX, CHENNAI [2014-TIOL-242-CESTAT-MAD] wherein it has been held that when the credit of duty paid on capital goods is allowed even much before they are put to use, the denial of credit on the contention that no output service was provided during the credit availment period is not justifiable.
Exemption from Service for GTA in respect of Edible oils has been provided under Notification no. 03/2013-ST dated 1.3.2013 How this works for reverse charge Ganesh (Posted On: 28 Feb, 2014)

The exemption from the levy of service tax on transportation of edible oil has been granted vide Notification no. 03/2013 which seeks to amend the mega exemption notification no. 25/2012. It is very clear that any service that is specified in mega exemption notification is not leviable to service tax. When the service itself is not leviable to service tax, the question of liability under reverse charge does not arise as reverse charge is applicable only for services that are chargeable to service tax.
Dear sir, One of my client is providing restaurant services.the abatement available is 60%.so we pay tax on only 40 percent amount.Rest of the amount is not taxable.so my question is that whether reversal of cenvat credit applies in case of restaURANT SERVICES . BHUPENDRA (Posted On: 28 Feb, 2014)

First of all, it is not abatement. But 60% is done by valuation rules. Most of leading hotels, are treating this 60% as exempted services and proportionate reversal is being done on the same.
Dear sir, One of my client is providing restaurant services.the abatement available is 60%.so we pay tax on only 40 percent amount.Rest of the amount is not taxable.so my question is that whether reversal of cenvat credit applies in case of restaURANT SERVICES . BHUPENDRA (Posted On: 28 Feb, 2014)

Yes, the provisions of Rule 6 are applicable in case of restaurant services because as per the Valuation Rule 2C introduced by the notification no. 24/2012-ST dated 06.06.2012, the taxable value in case of restaurant services has been specified as 40% of the total amount received. This implies that the 60% of the amount is not taxable and is hence exempted. The provisions of Rule 6 come into play in case of provision of exempted services. Accordingly, all the leading hotels are reversing the credit attributable to 60% of the amount that is not chargeable to service tax.
Dear sir, I am manufacturer, I had been paid interest on central excise duty for the year 2009-2010 @ 13% , excise commissioner asking 13 % interest notification no. , please sir help me,Thanks uttam (Posted On: 27 Feb, 2014)

As per notification 5/2011-C.E.(N.T.) dated 1.3.2011, the rate of interest under Section 11AA is 18% w.e.f. 1.4.2011. Similarly, notification 6/2011 prescribes 18% under Section 11AB.
Dear Sir, we were a proprietorship firm manufacturing padlocks (used in vehicles),(excisable goods). In excise return of December 2013, credit of excise input on few bills were overlooked & left (not considered in return) by error which we came to know few days back. From 1 Jan 2014 our proprietorship firm got converted into a private limited company & registered afresh in excise. My question is whether we can take the input credit of those goods which were purchased in old firm's name? Or is there any other way out so that we could take benefit of that input? Please advice. Thanks in advance. Deepti (Posted On: 26 Feb, 2014)

Although there is provisions as such for such a situation. We think that you must have applied permission for transfer of Cenvat credit under Rule 10A. Hence, we can clearly plead that there is error of not taking of credit but it must be allowed to us.
Sir,We are the manufacturer of Pig Iron (Iron and Steel Industry) by importing basic raw material i.e. Coke. 20% of our finished goods are exported under LUT as well as under CT-1. Now my query is whether we can claim Duty Drawback? If yes, what are the procedure and the quantum? We had exported from last 3 years but never claimed Duty Drawback due to ignorance. RAJIV JAIN (Posted On: 24 Feb, 2014)

You can apply to commissioner for Conversion of free shipping bill into drawback. There are number of cases where such conversion is allowed.
Dear Sir, Please provide excise tariff for cooker and confirm the excise duty is applicable or not on pallets which made from agro west.Thanks in advance Wanjarkhedkar G D (Posted On: 23 Feb, 2014)

We think that you are asking about pressure cookers which falls under tariff heading 73239310.The pallets of wood falls under 44152000.
Dear Sir, We paid service tax on Insurance of Bulding for MFG company can we availed service tax cenvat credit for the same? Wanjarkhedkar G D (Posted On: 23 Feb, 2014)

There is embargo on insurance of motor vehicle but the credit on insurance of building should be allowed.
Dear Sir, We paid service tax on Insurance of Bulding for MFG company can we availed service tax cenvat credit for the same? Wanjarkhedkar G D (Posted On: 23 Feb, 2014)

As per Rule 2(1) of Cenvat Credit Rules, input service means “any service used by a provider of an output service, or used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal.” The phrase “in or in relation to” is of wide amplitude and covers all services directly or indirectly related to manufacture of final products. Hence credit on service tax paid on insurance of building is indirectly related to the manufacture of final products because building is necessary for manufacturing final products and any damage or destruction to building will have direct impact on the production of goods. This view is also supported by the decision given in the case of Utopia India Pvt. Ltd. Vs Commissioner of Service Tax, Bangalore -2011 (23) S.T.R. 25 (Tri. - Bang.) wherein para 4.3 states that “general insurance service is availed to insure the assets of the assessee such as computers, equipment, building, etc. and cannot be denied on the basis that insuring the premises and the equipment from which output service is provided is not an activity connected to the business of the appellants. Therefore, the service tax paid under the insurance service for insuring the assets in the premises is an eligible input service…..” Hence it is clear that credit can be availed of service tax paid on insurance premium paid for building of manufacturing company.
Dear Sir, We paid service tax on Insurance of Bulding for MFG company can we availed service tax cenvat credit for the same? Wanjarkhedkar G D (Posted On: 23 Feb, 2014)

As per Rule 2(1) of Cenvat Credit Rules, input service means “any service used by a provider of an output service, or used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal.” The phrase “in or in relation to” is of wide amplitude and covers all services directly or indirectly related to manufacture of final products. Hence credit on service tax paid on insurance of building is indirectly related to the manufacture of final products because building is necessary for manufacturing final products and any damage or destruction to building will have direct impact on the production of goods. This view is also supported by the decision given in the case of Utopia India Pvt. Ltd. Vs Commissioner of Service Tax, Bangalore -2011 (23) S.T.R. 25 (Tri. - Bang.) wherein para 4.3 states that “general insurance service is availed to insure the assets of the assessee such as computers, equipment, building, etc. and cannot be denied on the basis that insuring the premises and the equipment from which output service is provided is not an activity connected to the business of the appellants. Therefore, the service tax paid under the insurance service for insuring the assets in the premises is an eligible input service…..” Hence it is clear that credit can be availed of service tax paid on insurance premium paid for building of manufacturing company.
please make clarification as per recent law and judicial pronouncement regarding cenvat credit of service tax paid to sales agents for domestic sales Shah Jayesh (Posted On: 21 Feb, 2014)

The number of decisions which allows the cenvat credit of Service tax paid on sales agents. But the High Court in case of Cadila Healthcare has disallowed the service tax paid on sales commission saying that it is not for sales promotion. The definition of "input service " includes sales promotion and not sales commission. Since then the litigation is going on between the department and assesse.
Dear Sir, We are manufacturer & exporter of mechanical engineering spare parts , tailor made( H S code 84122100, 84129090). We buy indigenous input ( excisable & non excisable) & also buy from foreign market.We take credit of cenvat on input.We export without payment of duty against LUT.my quetion is can we claim duty drawback at AIR on our export if yes ,please explain procedure. Thanks & regards Nawal Gupta (Posted On: 20 Feb, 2014)

There are two type of drawback rates i.e with Cenvat credit and without cenvat credit. Since you are availing Cenvat credit on inputs, then you can claim the drawback with cenvat credit. It is lower than rate without cenvat credit. Drawback with Cenvat credit covers only Basic Custom duty where as the Drawback without Cenvat covers BCD,CVD, SAD and input service.
Respected sir ...I want to know that ...how to do jeneral entry of tds n income tax in tally ....? Plz help me ...bcoz I dont know ...n I want to learn Raj kapul (Posted On: 20 Feb, 2014)

We deal in Excise, Customs and Service tax laws. Ask queries related to them only.
i have red bricks business with p.a tunover rs.15 lacks. under which act it is better to register. employees are temporary and they work only 6 months. the business is held in a village R VENKATA RAO (Posted On: 19 Feb, 2014)

Your query is not clear. Please ask for the queries relating to Central Excise, service tax, custom and DGFT as we are dealing in these laws only.
1.1. One of our clients is engaged in Overseas Education Consultancy ( named as ABC Consultants). On behalf of foreign universities, ABC Consultants offer admission services to students in India who intend to pursue higher studies at such overseas universities. 1.2. An agreement is executed between ABC Consultants and Foreign University, whereby, ABC Consultants agree to act as an agent of such University, for placement of prospective students. In terms of the said agreement, the services to be offered by ABC Consultants includes:  Advise on course and application formalities of the university;  Checking competency of the prospective student;  Ensuring authenticity of the documentation;  Promotion of activities of the university;  Supporting students in their visa applications;  Making students aware of the policies of the university 1.3. For the aforesaid services, Foreign University pays commission [as per the agreed terms] to ABC Consultants. Further, for the aforesaid assistance provided to students, ABC Consultants does not charge any fees to the students. 2. QUERY: 2.1. In light of the facts set out in the background above, ABC Consultants wishes to understand the Service tax implications on commission received from foreign universities, under the new regime for taxation of services introduced by Union Budget 2012-2013 (effective 1-7-2012). 2.2. Whether the said services will be covered under the definition of “Intermediary Services” as per Rule 9 of Place of Provision of Services Rules. Pavan Khabiya (Posted On: 18 Feb, 2014)

The definition of intermediary services is given in Rule 2 (f) of the Place of Provision of Service Rules, as follows:- “intermediary” means a broker, an agent or any other person, by whatever name called, who arranges or facilitates a provision of a service (hereinafter called the ‘main’ service) between two or more persons, but does not include a person who provides the main service on his account. On analysing the above definition, the services provided by ABC Consultants get covered under intermediary services. As such, the provision of Rule 9 of the POPS Rules would apply. In case of specified services covered under Rule 9, the place of provision of service shall be the location of the service provider. Since ABC Consultants fall under intermediary service hence they are covered under Rule 9 and thus place of provision shall be location of service provider, i. e., place where ABC Consultant is situated. Since the query does not specify the location of ABC Consultant therefore levy of service tax is dependent on the location of ABC Consultant. If ABC Consultant is situated in India, i.e., taxable territory, the place of provision of service would be in taxable territory and so service tax would be payable by ABC consultants. However, if ABC Consultants is located outside India, then no tax would be payable as the place of provision of service would be in non-taxable territory
Being an assessee for contract/buildership in 2005-06 yr from Maharashtra state, Sales Tax authority issed a demand notice for 8% VAT liability, is it correct ? confirm in details ASHOK D CHOWRIWAR (Posted On: 18 Feb, 2014)

We do not deal in sales tax laws. Ask queries related to Excise, Customs and Service tax laws.
Dear Sir i would like to know about the treatment in excise & customs for 2% of Exported goods which is rejected by the party & the same is disposed off there only. kindly reply ASAp.. thank you sir Jigar (Posted On: 18 Feb, 2014)

If the rejected export goods are returned to India then exemption under Notification 158/95 or under Notification 94/96 can be claimed. If you have to pay complete duty then you can claim drawback under Section 74. But there is no provision if the goods are disposed off in foreign country only.
Service Tax charge by Pvt Ltd on One time Lease { commercial Property } which buy by Pvt Ltd can we take CNVAT Credit of Service Tax paidby us Against Lease service tax which we have to collect from party in future Mahendra (Posted On: 17 Feb, 2014)

Input service means any service which is directly or indirectly used in relation to the output service or production of final goods as the case may be, thus the credit of the above will be available to you if you are a service provider or manufacturer.
Sir, Please provide me the website where i can get the case laws on excise and service tax without any subscription fees. RAJIV JAIN (Posted On: 15 Feb, 2014)

We are also publishing the same. you can enroll on our website and you will receive weekly newsletter. There is no subscription for the same.
Dear Sir, We are 100% EOU, we want to import of Machinery without payment of Duty with providing Procurement Certificate.That machinery is heavy weight,now we are importing part shipment.we will import remaining part after one or two months .Purchase Order value is total machinery. Now my doubt is How to take PC for this part shipment? Raj (Posted On: 12 Feb, 2014)

There is no procedure prescribed for the same. Either you can take the one procurement certificate and use for both the consignments. Or Else take tow PCs after convincing your range authorities.
Facts of the Case: Our company is sending various equipments to Overseas OEMs/OEM Authorized service centers. These equipments were overhauled & we are paying charges towards overhaul charges, spares consumed & testing charges. The machines after overhauls, return back to India . Custom duty is being paid by us on total amount paid to vendor i.e overhauling charges, spares consumed & other Charges . Further, we are also paying service tax on overhaul charges under reverse mechanism & cenvat credit is being claimed on service tax paid on overhaul charges. Query : Can overhaul service charges paid to foreign vendors for above services at their premises( located outside taxable territory) be qualified as services provided in the taxable territory ? . If not , payment of service tax under Reverse Mechanism is applicable to our company ?. Relevant provisions of Service Tax Act & Rules are given below: Section 66 B: Charge of services tax on and after finance Act 2012 There shall be levied a tax at the rate of 12% on the value of all services, other than those services specified in the negative list, provided or agreed to be provided in the taxable territory by one person to another and collected in such manner as may be prescribed. Section 66 C: Determination of place of provision of services: (1) The central Govt may, having regard to the nature and description of various services, by rules made in this regard, determine the place where such services are provided or deemed to have been provided or agreed to be provided or deemed to have been agreed to be provided. (2) Any Rule made under sub section (1) shall not be invalid merely on the ground that either the service provider or the service receiver or both are located at a place being outside the taxable territory. Place of Provision of Services Rules, 2012 Clause 4 : Place of provision of performance based services : The place of provision of services shall be the location where the services are actually performed, namely:- (a) Services provided in the respect of goods that are required to be made physically available by the recipient of the services to the provider of services, or to a person acting on behalf of the provider of service, in order to provide the service: Provided that when such services are provided from a remote location by way of electronic means the place of provision shall be the location where goods are situated at the time of provision of services ; Provided further that this sub-rule is not apply in the case of a service provided in respect of goods that are temporally imported ….. Section 68 : Payment of service tax (1) Every person providing taxable services to any person shall pay service tax at the rate specified in section 66 in such manner and within such period as may be specified. (2) Notwithstanding anything contained in sub-section(1) , in respect of such taxable services as may be notified by Central Govt in the Official Gazzatte, the service tax thereon shall be paid by such person and in such manner as may be prescribed at the rates specified in section 66 and all the provision of this chapter shall apply to such person as if he is the person liable for paying the service tax in relation to such service. Provided that the Central Govt may notify the services and the extent of services tax which shall be payable by such person and the provision of this chapter shall apply to such person to the extent so specified and the remaining part of the service tax shall be paid by the service provider. Reverse Charges Notification Under Section 68 (2) : Para 1 ( B) The taxable services provided or agreed to be provided by any person which is located in a non-taxable territory and received by any person located in the taxable territory ; The extent of service tax payable thereon by the person who provides the services and the person who receives the services for the taxable services specified in (1) shall be as specified in the following table , namely :- Sl no Description of services Percentage of service tax payable by the person providing services Percentage of service tax payable by the person receiving the service 10 In respect of any taxable services provided or agreed to be provided by any person who is located in a non taxable territory and received by any person located in the taxable territory Nil 100% S SAMPATH (Posted On: 11 Feb, 2014)

As per Rule 4 of POPS Rules, Place of Provision of performance based services is where the goods are physically made available to service provider or to person acting on behalf of provider of services. In the present case, services are related to repair of equipments that are necessarily required to be sent to overseas Authorised Service Stations for repair purpose. Hence, the transaction is covered by Rule 4 of POPS Rules as the essential characteristic of a service to be covered under this rule is that the goods temporarily come into the physical possession or control of the service provider, and without this happening, the service cannot be rendered. Since, overhaul service charges paid to foreign vendors for above services at their premises located outside taxable territory are covered under this Rule, hence the place of provision shall be where performance takes place. Since the place of provision is a non taxable territory service tax shall not be applicable on the same. Consequently, there is no liability under reverse charge mechanism on overhaul charges paid to overseas Authorised Service Station
Dear sir I am a regular reader and gained knowledge with your regular newslet. kindly applicability of service tax on following situation : suppose when any machine has been send to foreign country for repair / overhaudling and return to india after the same has been repaired /overhaudling in foreign country whether service tax is payable by the Service receiptant or after introduction of negative list whether the above service entered outside india is not liable to service tax regards s sampath S.SAMPATH (Posted On: 10 Feb, 2014)

As per Rule 4 of POPS Rules, Place of Provision of performance based services is where the goods are physically made available to service provider or to person acting on behalf of provider of services. In the present case, services are related to repair of equipments that are necessarily required to be sent to overseas Authorised Service Stations for repair purpose. Hence, the transaction is covered by Rule 4 of POPS Rules as the essential characteristic of a service to be covered under this rule is that the goods temporarily come into the physical possession or control of the service provider, and without this happening, the service cannot be rendered. Since, overhaul service charges paid to foreign vendors for above services at their premises located outside taxable territory are covered under this Rule, hence the place of provision shall be where performance takes place. Since the place of provision is a non taxable territory service tax shall not be applicable on the same. Consequently, there is no liability under reverse charge mechanism on overhaul charges paid to overseas Authorised Service Station.
is reversal of cenvat credit of Rule 4(5) is attract interest if reversal of credit not done with in 180 days. but we have sufficiant cenvat credit balance in our account. Chandra sekhar (Posted On: 10 Feb, 2014)

As per Rule 14 regarding Recovery of Cenvat Credit wrongly taken or erroneously refunded, it has been stated that “Where the Cenvat Credit has been taken and utilised wrongly or has been erroneously refunded, the same along with interest shall be recovered from the manufacturer of the provider of the output service and the provisions of section 11A and 11AA of the Excise Act or sections 73 and 75 of the Finance Act, shall apply mutatis mutandis for effecting such recoveries.” However in your case you have taken credit but not wrongly utilized it as there was sufficient Cenvat credit balance in your account. Therefore it does not amount to any loss to Revenue and there is no contravention. Thus you are not required to pay any interest on the reversal of credit not done within 180 days. We also wish to submit that similar view has been taken in the case of Sandvik Asia Ltd. Vs CCE, Ahmedabad [2010 (260) E.L.T. 81 (Tri.-Ahd)]. The head note of the case is produced as follows for your reference:- Interest - Cenvat/Modvat - Goods sent for job work but not received back within 180 days - Credit reversed after 180 days - Rule 4(5)(a) of Cenvat Credit Rules, 2004 providing for such reversal not provide any time-limit for same - Reasonable interpretation that such reversal be made immediately on expiry of 180 days - Rule 4(5)(a) ibid not provide for any interest or consequences of non-reversal of credit on expiry of 180 days - Rule 14 ibid provides where credit has been taken or utilised wrongly or has been refunded erroneously, for recovery of interest - Not clear presently whether credit required to be reversed was utilised or the same continued to remain in the account books - No interest if credit continued to remain in the account books - For verification of factual position, impugned order set aside and matter remanded to adjudicating authority. [paras 3, 4, 5, 6, 7, 8, 9, 10]
Dear sir, I had been paid interest on central excise duty for the year 2009-2010 @ 13% , excise commissioner asking 13 % interest notificaion no. , please sir help me, in which year interest rate 13% changed and notification No. Thanks Uttam uttam wagdare (Posted On: 03 Feb, 2014)

The rate of interest is changed to 18% under Section 11AA with effect from 1.4.2011 by Notification number 5/2011-C.E. (N.T.) dated 1.3.2011.
Dear Sir We are in to the business of print media (publishing English Daily News Paper) , Our major revenue Advertisement Revenue through news paper. my doubt is weather we have to pay any service tax. Kindly advise to us. now we are paying service to our transport agencies (for receiving news print through carriers). Shall we adjust to this liability to any input services like Telephone Bills, News Service agency service - for availing news services.) Thanks & Regards, M.RAM 8187897610 / 8019583696 rams.mvm@gmail.com manager accounts ram (Posted On: 02 Feb, 2014)

Service tax shall not be payable on advertisements published in print media as “Selling of space or time slots for advertisements other than advertisements broadcast by radio or television” is covered under clause (g) of Negative List. Hence, you are not required to pay service tax on advertisement published in print media. Further, you cannot adjust the service tax liability on transport agency to any other input services as services of Goods Transport Agency is covered under Reverse charge mechanism. Liability of Service tax under Reverse Charge Mechanism is required to be paid in CASH ONLY and cannot be adjusted through balance in Cenvat credit account.
Dear Sir, I have one export order & this order contains fifteen types of item. I want to prepare single ARE 1 at the time of dispach. Usually , An ARE 1 format has space for 4-5 items only. So, my question is that can I attach a additional sheet with ARE 1 for incorporating complete details of goods.Pls give your advice Nawal Gupta (Posted On: 01 Feb, 2014)

There is no rule prescribed for the same. But you can attach a annexure for the same. We presume that there will not be any objection to the department.
Dear Sir is crap sale liable to excise duty. SATISH KUMAR (Posted On: 30 Jan, 2014)

Yes, the sale of scrap is liable to excise duty if it is generated out of process of manufacture. There was Apex Court decision on this issue that the every rubbish thing can be sold in the market. But that does not mean that it is marketable. Hence scraps like dross or skimings are not liable to Excise duty. But later on the Section 2(d) was amended and it was held that clearly says that anything which capable of being sold for a consideration will be termed as "excisable goods" and these goods will be deemed to be marketable. Hence, the excise duty was levied on such goods after this amendment.
Sir ji.. is detention charges also subject to service tax. is this applicable even to GTA and GTO services. visuiyer (Posted On: 28 Jan, 2014)

After the introduction of Negative List w.e.f. 1-7-2012 detention charges are also chargeable to service list, since it is not included in the Negative List. It is covered by the phrase “agreeing to refrain from an act or to tolerate an act or a situation or to do an act” which is included in the definition of activity for the purpose of defining service.
our pvt limited paid paid one time premium to other pvt ltd for lease commercial properties is there service tax liability generated . Mahendra (Posted On: 25 Jan, 2014)

Yes the same would qualify for the renting of the immovable property as the definition of the renting includes the leasing under section 65B(41) of the Finance Act, 1994. Therefore the leasing of commercial property would be taxable @ 12.36 %.
I have recd FORM I from SEZ ZONE Purchases/Mfrs. for sale to SEZ Mfrs. I am also In SEZ Unit Holder Working, Let me know the USE/effect of FORM I, AND WHEN/WHAT IS THE USE OF FORM I ? CONFIRM ASHOK D CHOWRIWAR (Posted On: 24 Jan, 2014)

The above matter is governed by the VAT laws of respective states. Therefore we are unable to comment on the same. Ask queries related to the Central Excise, Service Tax, DGFT and Custom only.
Dear Sir one of my client is a retailer of Bosch company products he gets discount on purchases made from bosch but the same will be given subsequent to the invoice date.. say with in next month. The service tax department is asking him to pay ST on Discount saying it as a business auxilory Services (Department showing that the amount is reflected in my 23AS under 194H) please clarify wether the department can do so. Anil Kumar (Posted On: 24 Jan, 2014)

If it is discount on sale of goods then service tax cannot be charged on the same. But if it is in nature of commission then it will be chargeable to tax. Such type of show cause notices are normally issued to automobile dealers.
Sir, I am working with SEZ Unit, on sale to SEZ Unit,SEZ unit has (purchaser)issued form I to for not to charge of VAT at MAHARASHTRA-NAGPUR, Let me know the use of FORM I, AND TAX Liability to me at the time AssTT AT s.TAX authorities & FORM I WHEN & HOW TO USE ? CONFIRM ... ASHOK D CHOWRIWAR (Posted On: 23 Jan, 2014)

The above matter is governed by the VAT laws of respective states and we are not in dealing in the same. Therefore we are unable to comment on the same.
Dear Respected Sir With due respect, it is said that the following fact has to come our notice by the letter issued by Central Warehousing Corporation that it has been clarified by the ministry of finance vide its letter dated 08-11-2013 that Rice is not covered in the definition of agricultural produce as found in section 65B(5) of finance act and cannot be exempt from the preview of service tax. Kindly guide us whether rice is agriculture produce or not. We are taking its as agriculture produce and availing all exemption provided to agriculture produce on rice. Thanks Yours CA Praveen Bansal Mathura (Posted On: 22 Jan, 2014)

Yes, Recently Finance Minister has clarified that rice and cotton cannot be termed as an agricultural produce. Thus, the services related to these goods will not be covered under negative list. Agricultural produce, as defined under service tax law means any product that hasn't been processed at all or has only been subjected to minor process by a cultivator or producer that doesn't alter its essential characteristics but makes the commodity ready for sale in the primary market. Finance Minister P. Chidambaram has informed junior consumer affairs minister KV Thomas by issuing a letter dated 8th November, 2014 that rice and cotton does not comes under the definition of agriculture produce. It has been opined that paddy is an agricultural produce but rice is not since it has been processed and de-husked in a mill. Thus, it has been opined that it will not be classified under the definition of "agricultural produce" and thus, allied services will be subject leviable to service tax.
Dear Respected Sir We are constructing new factory building for Rice Mill. For this we are availing following service from our service provider- a Civil construction of factory building; b Civil construction for storage of raw material and finished goods' c erection, commissioning, or installation of required machinery. As per item no: 14 of notification no: 25-2012 construction, erection, commissioning, or installation of original works pertaining to,- (a) an airport, port or railways, including monorail or metro; (b) a single residential unit otherwise than as a part of a residential complex; (c) low- cost houses up to a carpet area of 60 square metres per house in a housing project approved by competent authority empowered under the ‘Scheme of Affordable Housing in Partnership’ framed by the Ministry of Housing and Urban Poverty Alleviation, Government of India; (d) post- harvest storage infrastructure for agricultural produce including a cold storages for such purposes; or (e) mechanised food grain handling system, machinery or equipment for units processing agricultural produce as food stuff excluding alcoholic beverages; Please guide us that whether construction of factory building of rice mill and construction for storage of rice are exempted by item no: 14 of notification no: 25-2012. Thanks Yours CA Praveen Bansal Mathura (Posted On: 22 Jan, 2014)

Recently finance minister has clarified that rice and cotton are cannot be termed as an agricultural produce, thus, the services related to these goods will not be covered under negative list. Agricultural produce, as defined under service tax law means any product that hasn't been processed at all or has only been subjected to minor process by a cultivator or producer that doesn't alter its essential characteristics but makes the commodity ready for sale in the primary market. Finance Minister P. Chidambaram has informed junior consumer affairs minister KV Thomas by issuing a letter dated 8th November, 2014 that rice and cotton does not comes under the definition of agriculture produce. It has been opined that paddy is an agricultural produce but rice is not since it has been processed and de-husked in a mill. Thus, it has been opined that it will not be classified under the definition of "agricultural produce" and thus, allied services will be subject leviable to service tax.
Sir ji.. here again a clarifiction wrt Works Contract, an assessee is in Interior Decoration business categorising himself as WCS and claiming 60% abatement; but the dept contention is Interior decoration is a seperate service and works contract and abtement is not applicable. now the liability is very HUGE .... pl. advise with your comments. visuiyer (Posted On: 16 Jan, 2014)

Work contract is a composite contract of goods whereas "Interior Decorator" means any person engaged, whether directly or indirectly, in the business of providing by way of advice, consultancy, technical assistance or in any other manner, services related to planning, design or beautification of spaces, whether man-made or otherwise and includes a landscape designer; [Section 65(59) of Finance Act, 1994 as amended]. There is clear cut difference between the two services. If material along labour charges are taken from customers then it is works contract. But if only advice of interior decorator is given then it will fall under “Interior Decorator” services.
Sir ji.. Can u pl. clarify, an assessee is in CABLE LYING for a private telephone operator; business; but categorising himself as Works Contract Service and paying tax with 60% abatement. But the Dept contention is the other way. Can u pl. advise the assessee as to whether he is right. visuiyer (Posted On: 16 Jan, 2014)

Work contract is a composite contract of both labour and material. Also for the purpose of service tax the term work contract means a contract wherein the transfer of the property in goods involved in the execution of such contract is leviable to the tax as sale of goods and such contract is for the purpose of carrying out construction, erection , commissioning , installation, completion, fitting out, repair, maintenance, renovation , alteration o any movable property or for carrying out any other similar activity or part thereof in relation to such property. Therefore as in above case, if both the material and labour is involved then it will be work contract. However, if the material is not involved then it might be charged to “site formation” services.
Respected Sir, We are receiving a component from Nepal for Job Work (coating) and it will be return to Nepal after coating. Please advise, Is Service Tax applicable on it or not? Regards Naren Arora (Posted On: 16 Jan, 2014)

In respect of tax liability of a person carrying out job work for his clients, any process amounting to manufacture or production of goods is in the negative list. But if the process does not amount to manufacture or production of goods, and is further not covered in mega notification, the same is liable to service tax. Moreover, the location of service recipient is in India, hence also the service tax is applicable as per Place of Provision of Services.
Dear sir, My client is exporter of goods and having service tax input.He had taken service tax number recently. What is correct proceedure of refund of service tax? To apply for service tax claim under notification 41 by applying ARST-2 form to AC of Central Excise or claim input in service tax return and than apply for refund.What id difference between two. S.P.GUPTA (Posted On: 13 Jan, 2014)

There is a specific procedure prescribed in Notification No. 41/2012-ST, dt. 29.06.2012 for the exporters for claiming refund of service tax paid on input services. The Exporter of Goods can claim 100% refund of service tax paid to effect the export of goods beyond the place of removal to the port of export. The exporter needs to simply fill up the FORM A1 attached to notification and submit to the AC/DC in Excise division office.
Respected Sir, we are paying Service tax under RCM for Security & manpower so can we get credit of 75% after making the payment of Service Tax. Deepak Dalvi (Posted On: 09 Jan, 2014)

As per rule 9(1)(e) of the cenvat credit rules the assessee paying service tax under reverse charge mechanism method will be eligible for the cenvat credit of the service tax paid under reverse charge on the basis of GAR 7 Challan by which the tax is paid. The assessee should pay service tax in cash and must not utilize for the payment of service tax under reverse charge. In fact credit of 100% would be allowable to the service recipient as 75% on the basis of the GAR 7 Challan and balance 25 % would be available on the basis of the invoices. Furthermore, as per first proviso to Rule 4(7) of Cenvat Credit Rules, 2004 the credit of service tax paid under reverse charge can be taken when payment of value of input service is made in addition to payment of service tax. Hence, you have to make payment to service provider in addition to payment of service tax.
Sir, I need a copy of Notification No.214/86-under central excise exempting jobworker from payment of duty if principal undertakes to pay the duty. My email-id is bpil403@gmail.com CA Sasikumar (Posted On: 08 Jan, 2014)

We have sent the same on your e-mail id.
Dear Sir, is IGNOU is liable to pay Service Tax to House Keeping Contractor being a Government Educational Institution? Babu Nandan Sah (Posted On: 08 Jan, 2014)

The services provided to education institution are exempt by item no. 9 of Notification no. 25/2012-ST dated 20.6.2012. Further the CBEC has clarified vide circular 172/7/2013-ST dated 19.9.2013 that the house keeping services will be included in the same.
A newly incorporated Pvt Ltd is authorized dealer for Chevrolet Cars. The company has received some material and services during its construction of office and administrative building and showroom and workshop. They have incurred and paid Excise Duty on items like cement, iron, spare parts, mechanical euipments, plant and machinery, DG set, tools & equipments etc Similarly, the pvt ltd com has paid ST on installation and commissioning, consultancy, man power, etc. Is it possible to avail CENVAT Credit of Excise Duty and ST so paid during its construction period in ST payment? The company is going to file its first ST-3 in April 2014 If yes, please reply with details. Thanks Bhagirath (Posted On: 08 Jan, 2014)

The definition of "inputs" given in Rule 2(K) of Cenvat Credit Rules, 2004 clearly excludes the inputs used in construction or execution of works contract of a building or a civil structure of part thereof. Similarly, the definition of "input services" given in Rule 2(l) of CCR, 2004 excludes service portion in execution of a works contract and construction services. Hence the credit of material used in construction will not be allowed. But the credit on DG set, tools and equipment and plant and machinery will be allowed if they fall in definition of "capital goods" given in Rule 2(a)ibid.
Sir One of our clients is proprietory concern and is a dealer in cotton. The said cotton is received after ginning and grading For transportation of cotton our client is paying freight. whether we can claim exemption of notification no: 03/2013 treating the said cotton as agricultural produce ? Kindly Clarify a.r.s.krishna rao radha sri krishna rao (Posted On: 07 Jan, 2014)

Recently, it is clarified by Finance Minister that cotton does not fall in agricultural produce. Even the same stand was taken for rice but it is told that it will fall under "food stuff", hence the transportation of rice is exempt. But cotton can not fall in the same. Hence the service tax is not exempted for the same.
if forging are supplied to job worker, job worker does the machining and drilling will it amounts to manufacture? and the scrap so generated will it amount to duty? job worker is coming uner rule 4(5a) of CCRi.e 108 days. PLEASERELY AS SOON AS POSSIBLE. REGARDS, SWATI SWATI (Posted On: 06 Jan, 2014)

It seems that you are supplying goods under Rule 4(5)(a) to job worker. The job worker need not to pay the duty on the same and return the same to principal supplier. If the scrap is also returned then also it is not chargeable to duty. The manufacturer who has supplied the material to job worker will enter the scrap in his RG-1 for scrap and will clear after payment of duty.
Dear Sir, I have registered for Service Tax but the turnover has not exceeded the basic Limit of Rs.Ten lakhs. Am i liable for paying Service Tax for the same period? and this is the first year of my business. Jitesh (Posted On: 02 Jan, 2014)

If a person’s taxable service turnover does not exceed Rs. 10 lakhs in a financial year than no service tax is payable. However, clause (viii) of Notification No. 33 /2012 dated 20-6-12 provides that basic exemption of Rs 10 lakhs for payment of service tax is available if the aggregate value of taxable services rendered by a provider of taxable services from one or more premises, does not exceed Rs. ten lakhs in the preceding financial year. Therefore as your service taxable value does not exceeds rs ten lakh you need not to pay service tax but if your taxable service crosses nine lakhs you will have to get registered under service tax and will have to pay service tax if the taxable value crosses ten lakhs. However, it should be taken care of that the basic exemption limit of Rs. 10 lakhs is not available in case of liability to pay service tax under reverse charge.
We are paying service tax under partial reverse charge for GTA, Manpower suppy service & Security service. Whether separate accounting code to be use for respective service or single i.e.00441089 under reverse charge? Yogesh Pawar (Posted On: 31 Dec, 2013)

At present, accounting code 00441089 is not in operation. We have to deposit the service tax under the respective service’s accounting code. The accounting codes for three services as mentioned by you are as follows:- Transport of goods by road – 00440262 for tax and 00440263 for other receipts Manpower Recruitment Agency – 00440060 for tax and 00400061 for other receipts Security Services – 00440108 for tax and 00400109 for other receipts.
We are paying service tax under partial reverse charge for GTA, Manpower suppy service & Security service. Whether separate accounting code to be use for respective service or single i.e.00441089 under reverse charge? Yogesh Pawar (Posted On: 31 Dec, 2013)

At present, accounting code 00441089 is not in operation. We have to deposit the service tax under the respective service’s accounting code. The accounting codes for three services as mentioned by you are as follows:- Transport of goods by road – 00440262 for tax and 00440263 for other receipts Manpower Recruitment Agency – 00440060 for tax and 00400061 for other receipts Security Services – 00440108 for tax and 00400109 for other receipts.
Services are performed in India but as per rule 3 of the Place of Provision rules they are treated as deemed to be provided outside India. whether in such case service tax should be levied? Sweta Bhandari (Posted On: 30 Dec, 2013)

Rule 3 of place of provision rules is a residuary section and if the situation does not falls in any rule from 4 to rule 12 then rule 3 will apply. Rule 4 of place of provision rules 2012 specifically deals with the situations regarding determination of place for the services based on the specific performance. As per these rules the actual place where the services were performed will be the place of services. And in your case the services are being performed in India therefore the same would be taxable under finance act 1994.
In VAT if Goods are being supplied to passengers on Board i.e. 20-30 min later of flight take off, will subject to VAT. whether it will be outside the purview of VAT, if so why? if Not then why? please send any relevant case laws regarding this. thanks and regards. Swati (Posted On: 30 Dec, 2013)

We do not deal in VAT laws. Please ask queries related to excise, service tax and custom laws.
Dear Sir i am a service provider providing services of earth work using Excavator. my doubt is wether i can avail the Credit of Excise duty paid on purchase of excavator for paying Service tax on my out put service on earth work service. please clariry anil kumar m (Posted On: 30 Dec, 2013)

While analyzing the definition of inputs under the cenvat credit rules 2004 it has been specifically mentioned that input means all goods used for the providing any output service but excludes capital goods except when used as the manufacture of the final products. Therefore as you are using the excavator which is a capital goods (tariff head: 84294030) in providing of output service which will not be eligible for the credit. But as per rule 4 2(a) of cenvat credit rules 2004 the cenvat credit of the capital goods used by the output service provider can be taken as 50% in the first year and balance credit in the second year.
Dear Sir, Whether Reverse charge mechanism is application on the reimbursement of expenses to advocate . Please explain . Ankur K Prince (Posted On: 27 Dec, 2013)

As per Rule 5 (1), reimbursement of expenditures incurred by the service provider in the course of providing taxable service shall be treated as consideration for the taxable service provided or to be provided and shall be included in the value of taxable service. And thus reverse charge will also apply on the same. However, Delhi High Court in the case of International Consultants and Technorats Pvt. Ltd. has decided that reimbursement of expenses cannot be charged to service tax by treating the same as part of service charges. Rule 5(1) of Service Tax (Determination of value) Rules has been held as ultra virus to the extent it brings the reimbursement of expenses within the ambit of service tax in this case. Practically service tax is paid on reimbursement of expenses.
Good Morning Sir, Kindly educate on the service tax rules applicable with respect to sale of drinking water along wih responsibilites of provider & receiver of services with applicable tax rates. Thanks & Regards, k.v. sai giridhar. kv.saigiridhar@itc.in K V SAI GIRIDHAR (Posted On: 23 Dec, 2013)

As per Circular No.173/8/2013 – ST, if goods are sold on MRP basis (fixed under the Legal Metrology Act) in an air conditioned Restaurant then they have to be excluded from total amount for the determination of value of service portion. Hence, there is no service tax on sale of drinking water at MRP.
sir, under rent a cab if service reciepant is a company and is paying the ST by claiming the abatement of 60% then weather the service provider not calming is required to take registration under ST ajay (Posted On: 17 Dec, 2013)

There are two type of service tax payment. If the provider claims credit then service tax on 60% of value is to be paid by service provider and rest 40% will be paid by service recipient. But if the provider is not taking credit then the service tax is to be paid by service recipient on 40% of value of taxable service. In this case, it seems that the company is paying tax and service provider is not taking credit. Hence the complete service @4.944% is to be paid by company only. If service provider is not liable to pay tax then he needs not to take the registration.
I am manufacturing excisable commodity say, motor pumps and paying duty and during the manufacturing process I get some scraps which is cleared without payment of duty. I also avail cenvat credit for my finished product. The department now says that I should reverse cenvat under Rul3 6(3) as I am clearing the scraps without duty. Rule 6(3) applies if only I use the cenvat for common inputs for manufacturing taxable and exempted products. My scrap is not manufactured. Is the Dept right? rengaraj (Posted On: 14 Dec, 2013)

For the above purpose you need to see whether your scrap is covered under any duty exemption notification. If the scrap is exempted then rule 6 gets attracted although there have been several cases where the applicant has contended that the scrap was not manufactured but emerged as a byproduct therefore rule 6 shall not apply but the point is under litigation. Therefore, Rule 6 (3) shall apply and you should reverse cenvat under Rule 6(3) as you have cleared scraps without payment of duty, The same view has been taken by Hon’ble Supreme Court in the case of Grasim Industries v. Union of India, [(2011) 10 SCC 653]. Practically also the assesses generally reverses the duty due to the small amount of duty involved.
Dear Sir, Could you please clarify the following doubts in Service tax on works contract. 1) X Proprietor based firm is diong construction work of ` 10,00,000/- including service for Y limited company (service receiver) than what is the service portion to calculated service tax to X ? and what is VAT portion to calculate value added tax? 2) X is calculated service tax and charged it on his bill then Y limited company has to pay complete tax amount or not as per reverse mechanism? 3) As per the reverse mechanism of service tax, Y service receiver has to hold 50% of service tax amount of the above bill with him and deposit the same in Government account though registration or shall Y company has to pay complete Service tax amount to X ? Praveen Kumar (Posted On: 14 Dec, 2013)

Service portion in works contract for original work is determined by 40% of total taxable value. In our case taxable value for service tax would be 1000000*40%= 400000. For computation of VAT respective state VAT laws will be seen. No, Y is not liable to pay complete tax. As partial reverse charge is applicable on works contract therefore he will be paying only 50% of total tax and rest 50% will be paid by the X. Y will hold 50% of service tax and shall pay the same to the government after getting registration. And rest 50% will be paid to X which X shall deposit the same to government.
Dear Sir, If a M/s ABC LTD, Service Provider ( i.e. GTA) is Company and XYZ Ltd ,Service Receiver (i.e. Company) is also a Company and Consignee is Individual. then, in that case who is liable to pay service tax ABC Ltd or XYZ Ltd, and for the same M/s ABC Ltd is taken a Service Tax number, but not charge service tax separately in the bill, then, in that case, who will be liable to pay service tax under reverse charge. Thanks and Regards Darpan Aggarwal 9711426455 DARPAN AGGARWAL (Posted On: 10 Dec, 2013)

Any person who pays or is liable to pay freight either himself or through his agent for the transportation of such goods by road in a goods carriage shall be liable to pay service tax.
Dear Sir, Is service tax credit is available on premium paid on marine insurance for outgoing of finished goods as well as on incoming of raw materials. Thanks & regards Nawal Gupta (Posted On: 09 Dec, 2013)

While analysing the definition of input service it is clear that any service utilised by the manufacturer whether directly or indirectly in or in relation to the manufacture of final product and clearances of final products up to the place of removal would be eligible for the cenvat credit. The above service of marine insurance i.e. the premium paid on the insurance of incoming raw material will be eligible for the input credit as it has direct nexuses with the production whereas the premium paid towards the insurance of outgoing finished goods are beyond the place of removal therefore disqualifies for the input credit. However, the board circular has clarified in case of transportation that the credit will be allowed on outward transportation if three conditions are satisfied. First condition is sale is FOR destination. Secondly the risk of damages is on consignor and price charged by supplier of goods is inclusive of transportation charges. If these conditions are satisfied for insurance also then the credit should be allowed in that case.
dear Sirji, What is the excise classification (excise tariff heading number) for the tyre oil extracted from old tyres and plastics from pyrolysis method. The by products are carbon black and steel wire,after extracting the tyre oil used as fuel oil in industries. Thanks, rengaraj (Posted On: 09 Dec, 2013)

Tariff head pertaining to the oils extracted from the minerals is 2710. It has been clearly mentioned in the chapter that references in heading 2710 to “petroleum oils and oils obtained from bituminous minerals” include not only petroleum oils and oils obtained from the bituminous minerals but also from the similar oils, as well as those consisting mainly of mixed unsaturated hydrocarbons, obtained by any process, provided that the weight of the non aromatic constituents exceeds that of the aromatic constituents. Therefore on the whole it can be concluded on the basis above language and on the property of the oil i.e. industrial fuel a specific entry has been mentioned which are 27101950 which will be eligible for the above oil.
Construction of Complex One flat is booked in the name of Mr. 'A' & he has paid part payment (40%on total Consideration. Service tax has been paid on that part by client. What will happen on cancellation of agreement of such flat & same was taken by another buyer. Is service tax is payable by dubble on sale of same flat ? if whole amt including service tax is returned to first buyer ? Or how credit is taken on tax paid on first sale ? chandra prakash (Posted On: 09 Dec, 2013)

As per rule6{3} of service tax rules, 1994 if the buyer decides to exit from the project at a later date then the builder/developer will be entitled to take credit to the extent he has refunded the original amount along with service tax. If the builder/developer resells the flat before the issuance of completion certificate, again tax liability would arise.
Construction of Complex One flat is booked in the name of Mr. 'A' & he has paid part payment (40%on total Consideration. Service tax has been paid on that part by client. What will happen on cancellation of agreement of such flat & same was taken by another buyer. Is service tax is payable by dubble on sale of same flat ? if whole amt including service tax is returned to first buyer ? Or how credit is taken on tax paid on first sale ? chandra prakash (Posted On: 09 Dec, 2013)

As per rule6{3} of service tax rules, 1994 if the buyer decides to exit from the project at a later date then the builder/developer will be entitled to take credit to the extent he has refunded the original amount along with service tax. If the builder/developer resells the flat before the issuance of completion certificate, again tax liability would arise.
Dear Sir, Can you provide me the solution to the following case discussed below: A-customer of B C-customer of D D-customer of A A (a subsidiary company in Mumbai) purchases material from B (a dealer in Mumbai). However the goods are directly delivered to C (a party in Orissa)by B.Further, A has billed D (holding company situated outside India)rather than C.Taxes charged in the above instances are as follows: B while billing A has charged M vat 12.5% which seems wrong to me. Also A while billing to D(foreign co)has charged Cst 12.5% and 5%. No idea of what D has done while billing to C. Can you please mention in the above case what forms are to be given by whom as everyone has been taxed which is normally not the case in sale in transit and also whether the M vat charged by B to A can be allowed as a set off to A because in reality considering the nature of transaction Cst should be charged.However since we have also charged Cst later will there be any need of forms. Please reply its really urgent.Please...... Lubhani Singh (Posted On: 07 Dec, 2013)

We do not deal in VAT laws . Ask queries relating to Excise, service tax and custom.
A company has obtained service tax registration , intending to provide banking and financial services . However no taxable services provided since the registration taken for last 5 years and company neither required to pay any service tax nor filed any return . from the books of accounts and certified accountants , it is clear no taxable service provided at all . company also not applied for cancellation of registration certificate . Now department under show cause notice intend to charge for for non filing of returns for each of the 10 6 monthly return filing period . What the defence company take in this case . any case law on the subject . one possible defence is that since company has not provided any taxable service , it is niether laible for registration nor filing any return . mere taking registration under abundant precaution should not be liable for nay penalty / late fee your valuable advise sought to defend the case thanks S S Gaur s s gaur (Posted On: 06 Dec, 2013)

It has been clarified by CBEC in circular no. 97/8/2007 dated 23.8.2007 that a person who is not liable to pay the service tax is also not liable to file the service tax return. The relevant para from this circular is reproduced as follows:- 6.1 The service tax return is required to be filed under Section 70 of the Act read with rule 7 of the Rules, by 'any person liable to pay the service tax'. This return is required to be filed on a half yearly basis, in Form ST-3. For the periods from April to September and October to March, it must be filed by the 25th October and the 25th April respectively. Further, ‘Input Service Distributor’ is also required to file this return. Persons who are not liable to pay service tax (because of an exemption including turnover based exemption), are not required to file ST-3 return.” As department cannot take any step contrary to the board circulars hence the benefit of this circular can be taken. Even the provision for late fees also says “the person liable to pay tax.....”. Hence no late fees is required to be paid for this also.
Sir, DTA unit who is supplying goods to 100% EOU (deemed export) by discharging the applicable duty can claim rebate under rule 18 of the Central Excise Rules, 2002 Srinivas Urs (Posted On: 04 Dec, 2013)

Foreign Trade policy refers such supplies as “deemed exports” but the Central Excise or Customs Act does not recognise it as exports. Hence the rebate under Rule 18 will not be available to supplier. But the refund of terminal excise duty is allowed under Foreign trade policy on such supplies. It is as good as rebate under Rule 18. However, the objection is also raised on such refund by a trade circular issued by DGFT. It says that the supply to 100% EOU is exempted from payment of excise duty, hence the refund of terminal excise duty will not be allowed.
ssir, we are constructing a hotel with 60 rooms with restaurant, banguet halls etc which is under construction and it takes another year for commercial lanching. In the meantime how to set off cenvat credits on capital items we purchse for hotel building and from plant & machinery items against our service outputs which is not yet started. will the authorities allow set off of previous periods against future service output collections pl clarify with your valuable suggestion and thanks in advance J. RANGANADHAM (Posted On: 03 Dec, 2013)

Definition of capital goods as per Rule 2 of Cenvat credit rules, 2004, includes capital good used for providing output services. Since, the capital goods are used for providing output service, the credit shall be allowed for the same. Further, Rule 4(1) of Cenvat credit Rules state that credit may be taken immediately on receipt of input/capital goods in the factory/premises of service provider. Thus, it prescribes the point of time from which the credit can be taken and do not provide for any specific time limit upto which the credit can be taken. Hence, the credit shall be allowed and it can be utilised at any time.
Dear Sir, I am working in manufacturing company and we have excess cenvat credit and my question is can we adjust excess cenvat credit of Basic excise duty to payable of Education cess and S.H.Edu.cess of finished goods or not? pravin_gooty@yahoo.co.in (Posted On: 02 Dec, 2013)

As far as utilisation of Cenvat Credit of Basic Excise Duty is concerned there is no such clause which restricts the assessee from using the Cenvat Credit of Basic Excise Duty for payment of Education Cess & Secondary Education Cess. So if there is no restriction then Cenvat credit of Basic Excise Duty can be used for payment of Education Cess & Secondary Education Cess. In addition to this the same issue has been already decided in case of Commissioner of Central Excise, Vapi Versus Donear Inds. Ltd.[ 2009 (233) ELT 0221 (Tri. – Ahmd.)] by holding that credit of Basic Excise duty can be utilized for payment of any duty of excise.
Sir,We have paid GTA service tax on fright inward & fright outward. Now i want to avail cenvat credit on fright inward only then how can i avail it? i.e which documentation procedure to be follow? Yogesh Pawar (Posted On: 18 Nov, 2013)

The basic document for availing the credit under reverse charge as per rule 9 of Cenvat Credit Rules, 2004 is GAR-7 challan only. It will be allowed if otherwise the credit is allowed in Cenvat Credit Rules ibid.
a person who is liable to pay tax under RCM can get benefit of cenvat crdit or not Mukesh jain (Posted On: 16 Nov, 2013)

As per rule 9 (1) (e) of Cenvat Credit Rules, the assessee paying service tax under reverse charge mechanism method will be eligible to avail cenvat credit of the service tax paid , on the basis of GAR 7 Challan by which the tax is paid. However, it should otherwise be allowed in Cenvat Credit Rules.
sir my query is.... In case of hotel industry if they are charging Luxury Tax then taxable value in respect of service tax will be including luxury tax or excluding luxury tax Mukesh jain (Posted On: 16 Nov, 2013)

It has been clearly mentioned in the circular no. 139/8/2011- TRU. F.No.334/81/2011-TRU that in case of Short Term Accommodation Service i.e the hotel industry the luxury tax imposed by the state won’t form the part of taxable value for the purpose of calculating service tax.
Hello sir, One of my client purchase air ticket from Authorized Agents who charged service tax accordingly. We sell these ticket to our customer with some margin. I want to now the manner we will raised invoice to our customer. ANKUR AGARWAL (Posted On: 08 Nov, 2013)

Rule 6 (1) of Service Tax (Determination Value) Rules, 2006 says that the commission charged by air travel agent is required to be included in value of taxable service. Sub-rule (2) of Rule 6 ibid says that the airfare will not be included for determination of value for air travel agent. Further, Rule 6(7) of Service Tax Rules says that air travel agent can discharge his service tax liability by opting for payment @0.6% in case of domestic flights and 1.2% in case of international flights of basic fare. However, you will be treated as sub-agent in this case. Hence, you have to pay the tax on your brokerage and main broker will take the credit of the same.
a factory providing vegetarian food during lunch hour in A/C dining hall to their employees by entering contract with non corporate catering service provider. what is the status of the factory who is corporate assesee in respect of Service tax liability. visuiyer (Posted On: 03 Nov, 2013)

Recently, the mega exemption notification has been amended vide notification no. 14/2013-ST wherein serial no. 19A has been inserted which reads as follows:- “19A. Services provided in relation to serving of food or beverages by a canteen maintained in a factory covered under the Factories Act, 1948 (63 of 1948), having the facility of air-conditioning or central air-heating at any time during the year.”. On analysing the above provision, it is clear that serving of food by a canteen in a factory is exempted from service tax even if it has air conditioning facility provided that the factory is covered under Factories Act, 1948. The A/C dining hall would also be covered within the expression canteen and would also be eligible for exemption provided the factory is covered by the Factories Act, 1948. However, service tax is chargeable on outdoor catering services and if service the outdoor catering service provider is not a small service provider, then service tax would be charged by the service provider.
A unit in WCS is providing all related services includes (WCS, Realestate, Maintenance repair and Commercial construction etc) in different abatement in the same service but no provision is available in ST03 to give them in detail; how to keep the informed the department on this various abatement in one service. visuiyer (Posted On: 03 Nov, 2013)

While filing the ST-3 return for the work contract service, you will have to select the service as work contract service which is listed on no. 119. Also for the purpose multi abatement taken you will have to add each and every individual abatement notification in add notification column. But the value of the abatement will be shown in consolidation.
Is out door catering is covered under Reverse charge mechanism. But one assessee is paying tax under RCM. How to get back the refund or adjust with other liability in case the amount is paid ignorantly visuiyer (Posted On: 03 Nov, 2013)

No, outdoor catering is not covered under the Reverse Charge Mechanism. If an assessee is paying service tax on outdoor catering under reverse charge basis by mistake then he should apply for refund. The refund will be subject to doctrine of unjust enrichment. The Apex Court has held that the doctrine of unjust enrichment is applicable for inputs and capital goods also. Following the same analogy, this doctrine is applicable for input services also.
Dear Pradeep Sir, Greetings. sir, we engaged a private limited company as contractor for civil construction, where we are providing sand and gitty to him. he is charging service tax under composition scheme under rule 2A(ii), without considering the fair value of the sand and gitty which we supplied. as being the company himself, reverse charge would not be applicable, but my quarry is, is there any liability on our company towards service tax, on the value of such sand and gitty? please clear my doubt. thanks in advance. (P Rathi) Parmeshwar Rathi (Posted On: 30 Oct, 2013)

According to rule 2A(ii) of service tax determination rules 2006 under composition scheme it is stated that service tax would be payable at the specified percentage of the total amount i.e including the value of material supplied under the contract. It is not clear whether free supplies would be included in the taxable value or not but till now free supplies were being added in the taxable value of service. However, on account of the recent decision made in the case of Bhayana Builders [2013-TIOL-1331-CESTAT-DEL-LB] it was held that the value of free materials supplied by service recipient do not form part of the taxable value for the purpose of service tax. In view of the said decision, there is no liability of your company on the supplies made to the service provider. However, as the matter involves interpretation of law, it is prone to litigation in future.
Dear Pradeep Sir, Greetings. sir, we engaged a private limited company as contractor for civil construction, where we are providing sand and gitty to him. he is charging service tax under composition scheme under rule 2A(ii), without considering the fair value of the sand and gitty which we supplied. as being the company himself, reverse charge would not be applicable, but my quarry is, is there any liability on our company towards service tax, on the value of such sand and gitty? please clear my doubt. thanks in advance. (P Rathi) Parmeshwar Rathi (Posted On: 29 Oct, 2013)

According to rule 2A(ii) of service tax determination rules 2006 under composition scheme it is stated that service tax would be payable at the specified percentage of the total amount i.e including the value of material supplied under the contract. It is not clear whether free supplies would be included in the taxable value or not but till now free supplies were being added in the taxable value of service. However, on account of the recent decision made in the case of Bhayana Builders [2013-TIOL-1331-CESTAT-DEL-LB] it was held that the value of free materials supplied by service recipient do not form part of the taxable value for the purpose of service tax. In view of the said decision, there is no liability of your company on the supplies made to the service provider. However, as the matter involves interpretation of law, it is prone to litigation in future.
Dear Pradeep Sir, Greetings. sir, we engaged a private limited company as contractor for civil construction, where we are providing sand and gitty to him. he is charging service tax under composition scheme under rule 2A(ii), without considering the fair value of the sand and gitty which we supplied. as being the company himself, reverse charge would not be applicable, but my quarry is, is there any liability on our company towards service tax, on the value of such sand and gitty? please clear my doubt. thanks in advance. (P Rathi) Parmeshwar Rathi (Posted On: 29 Oct, 2013)

According to rule 2A(ii) of service tax determination rules 2006 under composition scheme it is stated that service tax would be payable at the specified percentage of the total amount i.e including the value of material supplied under the contract. It is not clear whether free supplies would be included in the taxable value or not but till now free supplies were being added in the taxable value of service. However, on account of the recent decision made in the case of Bhayana Builders [2013-TIOL-1331-CESTAT-DEL-LB] it was held that the value of free materials supplied by service recipient do not form part of the taxable value for the purpose of service tax. In view of the said decision, there is no liability of your company on the supplies made to the service provider. However, as the matter involves interpretation of law, it is prone to litigation in future.
Dear Pradeep Sir, Greetings. sir, we engaged a private limited company as contractor for civil construction, where we are providing sand and gitty to him. he is charging service tax under composition scheme under rule 2A(ii), without considering the fair value of the sand and gitty which we supplied. as being the company himself, reverse charge would not be applicable, but my quarry is, is there any liability on our company towards service tax, on the value of such sand and gitty? please clear my doubt. thanks in advance. (P Rathi) Parmeshwar Rathi (Posted On: 29 Oct, 2013)

According to rule 2A(ii) of service tax determination rules 2006 under composition scheme it is stated that service tax would be payable at the specified percentage of the total amount i.e including the value of material supplied under the contract. It is not clear whether free supplies would be included in the taxable value or not but till now free supplies were being added in the taxable value of service. However, on account of the recent decision made in the case of Bhayana Builders [2013-TIOL-1331-CESTAT-DEL-LB] it was held that the value of free materials supplied by service recipient do not form part of the taxable value for the purpose of service tax. In view of the said decision, there is no liability of your company on the supplies made to the service provider. However, as the matter involves interpretation of law, it is prone to litigation in future.
Dear Pradeep Sir, Greetings. sir, we engaged a private limited company as contractor for civil construction, where we are providing sand and gitty to him. he is charging service tax under composition scheme under rule 2A(ii), without considering the fair value of the sand and gitty which we supplied. as being the company himself, reverse charge would not be applicable, but my quarry is, is there any liability on our company towards service tax, on the value of such sand and gitty? please clear my doubt. thanks in advance. (P Rathi) Parmeshwar Rathi (Posted On: 29 Oct, 2013)

According to rule 2A(ii) of service tax determination rules 2006 under composition scheme it is stated that service tax would be payable at the specified percentage of the total amount i.e including the value of material supplied under the contract. It is not clear whether free supplies would be included in the taxable value or not but till now free supplies were being added in the taxable value of service. However, on account of the recent decision made in the case of Bhayana Builders [2013-TIOL-1331-CESTAT-DEL-LB] it was held that the value of free materials supplied by service recipient do not form part of the taxable value for the purpose of service tax. In view of the said decision, there is no liability of your company on the supplies made to the service provider. However, as the matter involves interpretation of law, it is prone to litigation in future.
What is due date for vat audit in maharashtra suresh mehta (Posted On: 27 Oct, 2013)

We do not deal in VAT. Ask queries related to service tax, excise, customs and DGFT only.
Dear Sir, Yesterday one Notfn realeased i.e.,14/2013-ST. now pl clarify, if industrial canteen not have Air condition facility and having cooking with process steam, service tax liability as per new notification. Satya (Posted On: 23 Oct, 2013)

No the service tax liability will not arise if the canteen is situated in a factory registered under the Factories Act as this has been specifically exempted vide notification no. 14/2013 by inserting entry no. 19A in the notification no. 25/2012-ST. As per said notification, entry no.19A reads as follows:-“ Services provided in relation to serving of food or beverages by a canteen maintained in a factory covered under the Factories Act, 1948 (63 of 1948), having the facility of air-conditioning or central air-heating at any time during the year.” Therefore, there will be no service tax liability on such canteens maintained in a factory.
Dear Sir We are into shipping business and have a query on cenvat credit we make advance payment towards rail freigh to a comapnay say "A" but we are getting bills toward the service paid to "A" from "B" hence would like to know if Cenvat credit can be taken atul (Posted On: 22 Oct, 2013)

Yes the credit of the same can be taken on receipt of the invoice from the third party provided the invoice is in your name or you can establish that the service tax paid with respect to said invoice has been paid by you.
Dear Sir, Please advise, we are a service provider (Pvt ltd. company)providing commercial coaching services. At present,the company is constructing an office building (for its own use) and paid excise duty on building materials, generator, transformer etc. Whether we can avail and utilize the credit of excise duty paid on these inputs, while the building construction is still in progress. Thanks in anticipation CA Deepti Pal (Posted On: 21 Oct, 2013)

The definition of input and input services specifically excludes availment of credit on goods used for construction or execution of works contract of a building or civil structure or part thereof and so excise duty paid on the materials used thereon will not be eligible for Credit.
Dear Sir, Can Excise Return ER-1 be revised. If yes, please guide us on how to revise it. And if no, then advise how to rectify the error in ER-1 already filed. Thanks in anticipation CA Deepti Pal (Posted On: 21 Oct, 2013)

There is no such provision of revision of excise return. You will have to intimate about the mistake to the department via letter.
Respected Sir, ST-3 provides a column (part-I) for giving details of cenvat credit availed and utilised. But this column is for service providers only. My question is how can a service recipient (liable to pay ST under RCM) intimate the govt. authorities about the CENVAT that he wants to avail and utilise towards excise duty payment. NITU (Posted On: 16 Oct, 2013)

Under reverse charge mechanism, the liability to pay service tax is in cash, and cenvat credit cannot be utilised. As regards utilisation of cenvat credit towards excise duty payment is concerned, the same would be shown in Excise Return.
Respected Sir,ST-3 provides a column (part-I) for giving details of cenvat credit availed and utilised. But this column is for service providers only. My question is how can a service recipient (liable to pay ST under RCM) intimate the govt. authorities about the CENVAT that he wants to avail and utilise towards excise duty payment to be done in coming years. NITU (Posted On: 16 Oct, 2013)

Under reverse charge mechanism, the liability to pay service tax is in cash, and cenvat credit cannot be utilised. As regards utilisation of cenvat credit towards excise duty payment is concerned, the same would be shown in Excise Return.
Dear Sir, "A packaging Industry in Maharashtra has awarded annual garden maintenance contract for maintaining the gardens around factory. maintenance contract includes 3 workers, manure and replacement of plants to be directly used in the garden which are exempted from tax, garden tools which is contractors' property. Service tax is already being paid by contracor and reimbursed by company.QUERY is whether this attracts amny work contract tax and pacaging industry has compulsion to deduct and work contract TDS apart from re-imbursing service tax as per present laws in maharashtra? Please guide. Bharat K. (Posted On: 16 Oct, 2013)

We do not deal in VAT/TDS Laws. Please ask queries related to Excise, Customs, Service Tax and DGFT Laws only.
Respected Sir, Please inform us last date to submit EXP2 SUNIL (Posted On: 15 Oct, 2013)

The EXP2 is to be filed every six months. It is to be filed within 15 days from the completion of the half year as per Notification No. 31/2012-ST dated 20.06.2012. For eg. For Half Year ended September, 2013 it should be filed before 15 October, 2013.
Respected Sir, We have deposited reverse charge upon payment made to lawyer during sep'13. however lateron cheque has not been paid and also will no be paid. So can we take the credit of reverse charge deposited or is there any other alternative? Thanks in advance Sumit Pratap Singh (Posted On: 15 Oct, 2013)

As per first proviso to Rule 4(7) of Cenvat credit Rules, the payment of invoice as well as service tax has to be made to avail the Cenvat Credit.
Sir,please let me know whether work contract tax is applicable in Maharashtra on pure annual garden maintenance contract where labour work, supervision and materials like plant and cowdung manure (which are not taxable)is provided and totally used in the garden areas.Even tools used are also contractors' property. client is pacakaging industry and have awarded annual garden maintenance contract. whether cilent has to deduct WCT-TDS @ 5% from contractor's bills and pay to Authorities? Kindly guide. bharatgreen (Posted On: 14 Oct, 2013)

We do not deal in VAT/TDS Laws. Please ask queries related to Excise, Customs, Service Tax and DGFT Laws only.
Dear Sir, please clarify that if one registered gta gives transportation services under a single factory premises i.e. transport salt in the same factory premises is exempt from service tax or not ? sumit sharma (Posted On: 14 Oct, 2013)

The transportation of salt is exempted by virtue of clause (d) of the serial no. 21 of the Mega Exemption Notification No. 25/2013-ST which reads as follows:- “(d) foodstuff including flours, tea, coffee, jaggery, sugar, milk products, salt and edible oil, excluding alcoholic beverages;” This was being amended vide Notification no. 03/2013-ST dated 01.03.2013. Therefore, due to specific exemption, no service tax is leviable on transportation of salt.
Sir,This is reg. service tax on freight by road. Is Service tax is to be paid on loading & unloading labour charges also. KAILASH GUPTA (Posted On: 14 Oct, 2013)

General definition of freight does not include the loading and unloading charges but as the amount involved in such activities is very less, therefore it is advisable to pay service tax on them also as the same has been disputed by the department many times.
Sir We export goods we are required to pay freight from Mumbai to overseas location for transport of goods by sea by vessel are we liable to pay service tax on reverse charge basis on freight paid AJIT (Posted On: 12 Oct, 2013)

The transportation of goods by sea by a vessel is not leviable to service tax on reverse charge basis.
My Client is engaged in Mining Operations. He owns Excavators, Loaders, Trucks & Dumpers for the said purpose. He is constructing a Guest House/Office and Site development for improving & enhancing the mining operations. He shall be purchasing Air Conditioners, Plywood and Stones like Marble/Granite under Excise Invoice. Can he avail and utilize the Cenvat Credit on such Inputs towards Service Tax Chandani (Posted On: 12 Oct, 2013)

The definition of input and input services specifically excludes availment of credit on goods used for construction or execution of works contract of a building or civil structure or part thereof and so excise duty paid on the materials used thereon will not be eligible for Credit.
Dear Sir, My query is if we have paid service tax @25% on gta service ( we have dispacthed goods)then it is outward service and further because we have taken abatement, we cannot take cenvat credit of it right? now if we have paid 12.36% on gta service ( ooutward transportation) whether cenvat is available ? Aadish Jain (Posted On: 11 Oct, 2013)

Credit on GTA outward is available only if the following conditions are satisfied: 1) The sales takes place at the buyers place /door or the property in the goods remains with the seller till the goods reaches buyer in an acceptable condition. 2) The risk of damage to goods during the transit is Bourne by seller /manufacturer. 3) The freight charges are integral part of price of goods. Usually the credit on the output freight is disallowed due to non fulfilment of above conditions and not due to the fact that service tax is payable on 25% of total freight. When the cenvat credit on input is not availed by the GTA then the service recipient is eligible to pay tax on 25%. Else the tax is payable on full 100%. In both the scenario the cenvat credit on outward freight is available only if above three conditions are fulfilled.
Dear Sir, My query is we are manufacturer ,if we have paid 25% of service tax on gta service( goods have received in the factory) then it is input service, so whether we can take cenvat of it because we have taken an abatement ? Aadish Jain (Posted On: 11 Oct, 2013)

Any service tax paid on the service which is used directly for the purpose of providing of output service or for the manufacture of the finished goods can be taken as the input credit. In case of GTA service the service tax is payable on 25% of total freight if the credit on inputs has not been taken by the GTA. If the credit on input has been taken then the service tax is payable on the total 100% freight. In both the cases the credit of ST paid on GTA would be available to the service recipient i.e. the person paying ST.
Whether jobwork charges for fabrication isliable to service tax? Here Fabrication includes all work which are done during the course of conversion of cloth into ready made garment i.e. cutting, stiching etc. Pradeep Kr. Varshney (Posted On: 07 Oct, 2013)

As per clause (f) of negative list of services as per section 66D of finance act 1994 any process amounting to manufacture or production of goods is not taxable service. As per excise laws any activity which creates a new and identifiable product having distinctive name, character or use must emerge. Conversion of cloth into readymade garment amounts to manufacture. Even Excise duty was charged on the same prior to 1.3.2013. It is exempted by amending Notification 29/2004 and 30/2004 by notification number 11/2013. Secondly, there is exemption to textile processing also. This will fall under textile processing only. Hence, it is once again not chargeable to service tax.
Educatinal Institution is providing Bus Service to students though its owned buses. Should they charge Service Tax ? If yes, at what rate ? PRAVIN SARASWAT (Posted On: 06 Oct, 2013)

Initially, in Mega Exemption Notification No. 25/2013 dated 20.06.2012, auxiliary educational Services provided to or by an educational institution in respect of education exempted from service tax. Later, vide Notification no. 03/2013-dated 01.03.2013, this notification no. 25/2012 got amended to exempt only services provided to an educational institution. Hence, at present transport services provided by an educational institution to students are taxable services and at the normal rates of service tax, i.e., @12.36%. But if there is a contract carriage for the transportation of passengers/STUDENTS, excluding tourism, conducted tour, charter or hire; then the above service will itself get exempt under entry no. 23(b) of the mega exemption notification no. 25/2012 dt.20.06.2012.
Respected Sir, Instead of deposite in PLA for 2% Ed. Cess & 1% H & S Can we utilised from 12% BED Balance ? shayan (Posted On: 02 Oct, 2013)

As far as utilisation of Cenvat Credit of Basic Excise Duty is concerned there is no such clause which restricts the assessee from using the Cenvat Credit of Basic Excise Duty for payment of Education Cess & Secondary Education Cess. So if there is no restriction then Cenvat credit of Basic Excise Duty can be used for payment of Education Cess & Secondary Education Cess. In addition to this the same issue has been already decided in case of Commissioner of Central Excise, Vapi Versus Donear Inds. Ltd.[ 2009 (233) ELT 0221 (Tri. – Ahmd.)] by holding that credit of Basic Excise duty can be utilized for payment of any duty of excise.
Requested to pelase arrange to furnsih the servicetax exemption and abatement notification no. for manpower recruitment agency. Regards, Sandeep Jain sandeep jain (Posted On: 02 Oct, 2013)

There is no separate and specific exemption available for the man power recruitment service. Only general exemption is available i.e the SSP exemption given in item no. 8 of notification no. 30/2012, dated 20.6.2012. The service tax in respect of services of manpower supply provided by individual, HUF, proprietary firm or partnership firm including association of person located in taxable territory provided to business entity registered as body corporate located in taxable territory is payable 75% by service provider and 25% by service receiver. The above arrangement is prescribed under reverse charge mechanism.
Dear Sir, Please clarify our RO is telling that, if you have taken cenvat credit of Service providers invoice, it is responsible of receiver(credit taken firm) to check whether SP has paid his liability of ST to govt? as per my knowledge it is not our(SR) responsibility sir. hence , you please clarify where in the rule this issue? Satya (Posted On: 26 Sep, 2013)

Earlier there was a Rule 9 (3) in the Cenvat credit rules which states that reasonable steps like proof of identification of service provider or manufacturer etc must be taken by the service receiver so as to safeguard his Cenvat Credit taken but the same has been deleted. Therefore the contention of RO is not sustainable.
Hello sir.I want to know whether we can claim input credit of the service tax paid on rent for the stockhouses or warehouses where our goods are stocked for further action or despatch and whether we can claim the input of the admin building also? Bharath (Posted On: 25 Sep, 2013)

The query is not clear whether you are manufacturer or a service provider (say Clearing and forwarding agent). However, we are presuming that you are manufacturer. The definition of “input service” given in CCR, 2004 says that the services should be used by manufacturer, directly or indirectly, in or relation to the manufacturer of the final products and clearance of final products up to the place of removal. If the final product are stored outside the factory premises in the warehouse then the department will object the same saying that these are post removal expenses. But when the sales promotion and advertisement are allowed then the credit on these expenses should be allowed. Similarly, for the administrative building, the department will say that it is not used for the manufacture but it is directly or indirectly used for such service.
For ER-6,which weight to be considered as consumption Qty( Input weight or final product weight)? Yogesh Pawar (Posted On: 25 Sep, 2013)

While mentioning the details of the input consumed the weight description will be of inputs only as at the time of consumption the finished goods are not in the existence.
dear sir, my query is our client is builder & what ever expenses incurred by company is transfer to closing WIP. company also received an advances against sale of flat hence company is liable to pay service tax on amt. received. but company had not remit the service tax to government account is it disallowed under section 43b. even those their is no profit in profit & loss account. RUPESH MORE (Posted On: 24 Sep, 2013)

We are not dealing with Income tax matters and hence are not expert under the same. Hence we are not able to reply our query. However, as far as our knowledge goes Section 43b of Income Tax Act 1961 states that certain items like government dues e.g. duty, tax etc are allowed on payment basis. Thus if you have not paid the service tax the same will be disallowed under section 43b while computing the income as per section 28 of Income tax act 1961.
Whether CENVAT credit of Service Tax is admissible on the Services availed for Dismantling of closed plants? Rahul (Posted On: 24 Sep, 2013)

Input service is the service which is used directly or indirectly for providing of output service or for the clearances of the dutiable product. Hence, it is to be proved that the same is used for providing output service or in manufacture of final product. Thereafter, you can take the cenvat credit.
Respected Sir We have received some bills from an advertising agency who have charged service tax on 15% value i.e. after claiming abatement of 85%. There is any legal notification through which the party claimed abatement of 85%. Can we take service tax input of above Amount Rajat jain (Posted On: 23 Sep, 2013)

There is no service tax on advertisement published in print media. The service tax is only on the commission of advertisement agency. Normally, the newspapers gives commission of 15% to advertisement agency, hence the service tax on the same is correctly charged.
Dear Sir, One of my clients is into sub contracting work of windows installations for the entire building of the builder. Kindly suggest whether he will have to charge service tax at 40%, 60% or 70% Jinendra Parakh (Posted On: 23 Sep, 2013)

In case of work contract relating to the immovable property, original works relating to installation of equipment the taxable portion is 40% of the total amount charged.
pl let us know the tipping vehicles used are exempted from GTA; pl cite the notification/circular if any avilable visuiyer (Posted On: 23 Sep, 2013)

The GTA exemption is available on the basis of the consignment note issued by the registered transport agency and not on the nature or type of the vehicle used for the transportation. If the owner of the tipping vehicle is a registered goods transport agency and issues consignment note then the transaction would be taxable as GTA service.
Sir,suppose we processed some input inhouse & sent for next processing to job worker & we did not received this material within 180 days then cenvat credit to be reverse on availed on principle input or on principle input+inhouse overhades ( Machining+manpower wages+power comsumption etc.)? Yogesh Pawar (Posted On: 22 Sep, 2013)

In case of job work if the inputs or the capital goods are not received back within one hundred and eighty days, the manufacturer shall pay an amount equivalent to the Cenvat credit attributable to the inputs or capital goods by debiting the Cenvat credit account with the amount so attributable to the inputs or capital goods not received. But the manufacturer can take once again the Cenvat credit so debited when the inputs or capital goods are received back in his factory. Thus the value for overheads i.e. allocated cost is not to be included in the value of the inputs on which the credit is to be reversed.
Sir,suppose we processed some input inhouse & sent for next processing to job worker & we did not received this material within 180 days then cenvat credit to be reverse on availed on principle input or on principle input+inhouse overhades ( Machining+manpower wages+power comsumption etc.)? Yogesh Pawar (Posted On: 22 Sep, 2013)

Already answered. In case of job work if the inputs or the capital goods are not received back within one hundred and eighty days, the manufacturer shall pay an amount equivalent to the Cenvat credit attributable to the inputs or capital goods by debiting the Cenvat credit account with the amount so attributable to the inputs or capital goods not received. But the manufacturer can take once again the Cenvat credit so debited when the inputs or capital goods are received back in his factory. Thus the value for overheads i.e. allocated cost is not to be included in the value of the inputs on which the credit is to be reversed.
Sir,suppose we processed some input inhouse & sent for next processing to job worker & we did not received this material within 180 days then cenvat credit to be reverse on availed on principle input or on principle input+inhouse overhades ( Machining+manpower wages+power comsumption etc.)? Yogesh Pawar (Posted On: 22 Sep, 2013)

Already answered. In case of job work if the inputs or the capital goods are not received back within one hundred and eighty days, the manufacturer shall pay an amount equivalent to the Cenvat credit attributable to the inputs or capital goods by debiting the Cenvat credit account with the amount so attributable to the inputs or capital goods not received. But the manufacturer can take once again the Cenvat credit so debited when the inputs or capital goods are received back in his factory. Thus the value for overheads i.e. allocated cost is not to be included in the value of the inputs on which the credit is to be reversed.
Respected Sir, Can you kindly tell me the Mega exemption notification number for service tax under job work against Excise 4(5) Challan. can we take the exemption under notification number 25/2012 ST 30(C). please correct me. Regards, Deepak Deepak Dalvi (Posted On: 22 Sep, 2013)

The exemption from the payment of service tax in case of job work is specified in the Entry no. 30 -clause c of the mega exemption notification no. 25/2012- ST. It says that the intermediate process is exempted when the supplier pays the appropriate duty on final product. Since he is supplying the goods under Rule 4(5) of Cenvat Credit Rules, then it is implied that he has taken the cenvat credit on the inputs. The credit is allowed when the final product is chargeable to duty. Hence, the supplier will clear the final product on payment of duty.
Dear Sir, II have a one contract which is related to paint (SUNCITY PROJECTS PVT. LTD) on wall and water tank( tower),party also charged service tax @12.36% on rate per sq.ft.( specified). Pls guide me applicability of reverse charges on it. Whether above contract cover under work contract? If party would not be charged service tax then what action will be taken? Pls guide me. Thanks and regards Amit Gupta ASST. MANAGER SUNCITY PROJECTS PVT.LTD. Amit Gupta (Posted On: 21 Sep, 2013)

Firstly, it is not clear that the contractor is individual or company. If he is a company then reverse charge is not applicable. But if he is an individual then the next it is not clear whether the contract is inclusive of material or labour charges only. If it is inclusive of material then it will fall under works contract. The next question will be whether the same is done on a new building or old building. If done first time on new building then it will fall under construction and the service tax will be payable @ 60% under finishing services. But if it is done on old building then the service tax will be payable on maintenance or repair then the service tax will be payable @ 70% of gross value. If the answer to first question of labour and material is in negative i.e. it is labour contract only then we have to see whether it falls under manpower supply agency. For this, we have to see whether the supervision and control is with contractor or the company. This will be dependent on terms and conditions of agreement. However, when the work is on piece rate as is in your case then normally the supervision and control is with the contractor. But we reiterate that it will depend solely depend on terms and conditions of agreement. If the control and supervision is with the contractor then no reverse charge is applicable. In other case, the reverse charge is applicable and company has to pay the service tax on 75% of total service tax amount.
Sir, Ours is a Manufacturing company. Our supplier is showing material value and transportation value in One Invoice. How to take input credit on Inward freight charges Pls clarify. Gururaj (Posted On: 20 Sep, 2013)

This is not clear whether the service tax amount is also charged by him in the invoice. Normally, we have seen that the service tax is also charged in the invoice. But the department says that the credit is not available on such invoice as the credit is available only on basis of challan as per Rule 9 (1)(e) of Cenvat credit Rules. But this clause says that the credit is available when the service recipient is liable for payment of service tax. But as per Rule 2(1)(d)(v) of Service Tax Rules, the person paying the transportation charges to the transporter is liable to service tax. Since your supplier has paid the freight to transporter then he is liable to pay service tax. As he has charged the service tax in invoice under Rule 11 which is valid duty paying document then you can take the credit on the same.
What can be the Consequences, if ER-2 is not filed by a company till date? Jitesh (Posted On: 20 Sep, 2013)

The penal action will be imitated by the department for non filing of return. A show cause notice will be issued to you.
Sir, We are the service reciever by goods transportation by road through transport agency. I trouble the return file what is the abetmend and sr.no. Pl. help the above query Thanking you Suresh Prajapati (Posted On: 20 Sep, 2013)

The exemption for GTA is contained in notification is 30/2012 serial no. 21 (a)/(b)/(c) and for abatement, notification for GTA exemption is 26/2012 serial no. 7.
Sir, In our recent excise audit, Dept has given a memo to reverse credit of service tax taken on work contract service/civil work. Actually we took credit because it relates to repairs/renovation of our factory boundary wall, main gate, floor repairing etc. Now they are saying that nothing is allowed under work contract/civil construction. As per bill they found that RCC/PCC work upto 300 mm plinth level construction falls under work contract and abatement is on different rent. our contractor has charged service tax on full value and we took credit the same and also utilized against excise duty payable. Please suggest us what to do? they are also threatening us if we fail to prove it right we have to pay 100% penalty of the credit taken i.e. Rs. 1.93 lacs on civil repairs. Sir, need your guidance... rgds, Anurag Anurag Singh Rajpoot (Posted On: 20 Sep, 2013)

When the contract of service cannot be differentiated from the material supplied the valuation rules as prescribed in the Rule 2A(ii) of the service tax (determination of value) 2006 would apply. As per this clause, the service tax is to be paid on value after abatement. Also it is clearly mentioned in the input service definition that the construction pertaining to new construction or execution of work contract is specifically excluded for the eligibility of the service tax credit. However, if the same is related to repairing, renovation etc then it falls under main definition. But this is also not free of doubt because the exclusion clause says that the credit will not be available for construction or work contract service related to building or civil structure.
Sir, In our recent excise audit, Dept has given a memo to reverse credit of service tax taken on work contract service/civil work. Actually we took credit because it relates to repairs/renovation of our factory boundary wall, main gate, floor repairing etc. Now they are saying that nothing is allowed under work contract/civil construction. As per bill they found that RCC/PCC work upto 300 mm plinth level construction falls under work contract and abatement is on different rent. our contractor has charged service tax on full value and we took credit the same and also utilized against excise duty payable. Please suggest us what to do? they are also threatening us if we fail to prove it right we have to pay 100% penalty of the credit taken i.e. Rs. 1.93 lacs on civil repairs. Sir, need your guidance... rgds, Anurag Anurag Singh Rajpoot (Posted On: 20 Sep, 2013)

When the contract of service cannot be differentiated from the material supplied the valuation rules as prescribed in the Rule 2A(ii) of the service tax (determination of value) 2006 would apply. As per this clause, the service tax is to be paid on value after abatement. Also it is clearly mentioned in the input service definition that the construction pertaining to new construction or execution of work contract is specifically excluded for the eligibility of the service tax credit. However, if the same is related to repairing, renovation etc then it falls under main definition. But this is also not free of doubt because the exclusion clause says that the credit will not be available for construction or work contract service related to building or civil structure.
Respected Sir, Party sends us material for job work with Excise 4(5) Challan in our factory. we charges labour charges in the bill. can we charge service tax in the bill or not. if not then why. Deepak Dalvi (Posted On: 19 Sep, 2013)

The exemption is given to intermediate process under clause 30 of Mega exemption notification. It says that if the principal manufacturer pays the duty on goods. Since the principal manufacturer is giving material under Rule 4(5)(a) of CCR, 2004, it implies that he has taken credit on the same. He will be required to pay the duty on final product after processing. Hence, you cannot charge the service tax as the exemption is available to you.
Purchased an equipment from registered dealer (first stage delear ) under central excise. Excise duty is not shown separately in invoice but mentioned as” selling price is inclusive of excise duty”. The equipment is input to the provider of taxable service. Will the invoice be valid duty paying document to claim cenvat credit? sivakumar (Posted On: 18 Sep, 2013)

Rule 11 of cenvat credit rules 2004 specifies certain requirements that must be present in the excise invoice such as date and time of removal and preparations of invoice, transporters details, excise registration number, consignee details, complete address of range and division, etc one of the condition is that duty amount and rate must be separately shown in the invoice. Such conditions also apply invariably to the 1st stage and 2nd stage dealer. Thus in light of the above provision, the department may object the availment of the credit.
Sir, BSNL as a service provider, CIVIL unit of the BSNL, make a works relates to maintenance of all the Telephone Exchanges (from which the service provide to the customer like Basic Telephone Service, Broadband, Leaseline, Wi-fi, Hot line etc.......)i.e. construction of compound wall, shelter for GSM TOWER BTS, etc. sir I want to know that whether we can avail the CENVAT Credit for such maintenance work ? If so, the relevant guideline/rules/notification may be mentioned/provided pl. dinesh chaudhari (Posted On: 17 Sep, 2013)

Your query is not much clear. The query understood by is that one unit of BSNL is providing service of repairing to BSNL and paying service tax on the same. The BSNL intends to take credit on the same. If the query understood by is us is correct then our reply is as under:- One unit of same person is providing service to another unit. But for imposition of service tax, there should be two persons. When one unit of same person is providing service to another unit in India then it is not service at all. One cannot provide to himself. Hence the service tax is not payable at all.
Whether jobwork charges for fabrication or embroidery of garment/textile are subject to service tax. Pradeep Varshney (Posted On: 15 Sep, 2013)

If the process undertaken by you is termed as “textile processing” then it is exempt from levy of service tax. Secondly, if these process amounts to manufacture under Central Excise then the service tax is not applicable. To reply more specifically, the details of raw material, process undertaken and finished goods manufactured is required.
Dear Sir I am maintained 2 units same name and different excise ranges and vat is same my query is i am purchase machinery in uni-1 name but now i am transfer to machinery our Unit-II how what is the process? Balaraju (Posted On: 13 Sep, 2013)

We are dealing in Central Excise matters. Hence, we can tell you about central excise provisions. The premises are registered in Central excise and hence two units located at two different locations will have different registration. If we despatch the capital goods from one unit to another then it will be cleared under Central Excise invoice. If the capital goods are cleared as such before put to use then unit must have taken 50% credit. He can take the another 50% credit and clear the capital goods by reversing the complete Cenvat duty. The unit can take the credit on the same. There is no question of sales price as one unit is clearing to another unit. If the capital goods are cleared after being put to use then the depreciation @ 2.5% per quarter will be available. The unit clearing the material has to reverse the cenvat credit after such depreciation. The unit receiving the goods can take the credit if these are capital goods for him.
whether cenvat credit allow under import capital goods under EPCG Scheme, as per our Bill of entry Total duty debited from Duty Bond amount , mention in bill of entry. Ashok Makwana (Posted On: 12 Sep, 2013)

EPCG scheme allows import of capital goods at zero duty for specific sectors and at a concessional rate of 3% of customs duty for all sectors. But this 3% duty is Basic custom duty. Hence, when the duty is not paid at the time of import then no question of taking credit arises.
My client is running Restaurant collecting service tax @4.944%.My querry is whether it can take cenvat credit on service tax paid on rent and excisevpaid on liquor Punita Batia (Posted On: 08 Sep, 2013)

In case of restaurant services, the service tax is payable on the 40 % of the total amount as per Rule 2C of Service Tax (Determination of Value) Rules, 2006. The Explanation 2 of above rule clearly say that credit on inputs falling under Chapter 1 to 22 will not be available. Moreover, the liquor is chargeable to State Excise duty and not to Central Excise duty. Hence the credit of the same is not available. However, there is no restriction on credit of input service and capital goods. Hence, the credit of same is available provided the same is allowed in Cenvat Credit Rules, 2004.
Service tax on GTA under reverse charge mechanishm is applicable if service provider is cargo handling services. chaitanya (Posted On: 05 Sep, 2013)

Cargo handling service is itself a different service taxable. This service is not covered under reverse charge mechanism. Therefore the service tax is payable by the service provider only.
Our company Ajmer Vidyut Vitran Nigam Limited, involved in electric distribution work. AVVNL provide the material to contractor and contractor use that material for erection of 11 KV/ LT lines. Contractor produces his labour portion bill to AVVNL. Is AVVNL liable to pay 50% service tax on contractor bill under reverse charge mechanism? please Advise. Ganesh Kumar Vijay (Posted On: 05 Sep, 2013)

If terms of agreement show that the contractor will use some of his owned material as well as labour charges then the above service would fall under the work contract. Also the work contract service falls under the reverse charge. In that case, the free supply material will be added and service tax will be payable on complete amount. However, this will be subject to other provisions of works contract. However, if the terms of contract are that all material will be provided by you and he will charge only for labour charges then it will be labour contract only then it will not fall under works contract and reverse charge will not be applicable. As you have mentioned also that it is labour contract only, then no reverse charge applicable. However, you can also examine whether the contract does not fall under “manpower supply agreement”.
We paid service tax on general insurance for building,cash and gold but we can't availed credit of it.Is it right or wrong ? What should we have to do? shashikant borse (Posted On: 04 Sep, 2013)

You have not told the type of work undertaken by you. Hence, it will be difficult to comment on the same. The general insurance in relation to vehicles is not allowed. However, the credit of general insurance is allowed if the same is used by provider of output service for providing output service or by manufacturer in or in relation to manufacture of final product. Please judge the same on your own.
Can a Restaurant providing "Restaurant Service" and "Mandap Keeper Service" avail CENVAT credit of Service Tax paid on Rent of premises. please clarify. anil kumar m (Posted On: 02 Sep, 2013)

In case of restaurant services as per Rule 2C of Service Tax (Determination of Value) Rules, 2006 prescribed from 01-07-2012 under Notification No. 24/2012, the abatement is available for restaurant service @ 60%. Therefore the effective service tax payable will be 4.944%. (12.36*40%). If the abatement option is to be availed then service provider shall not take CENVAT credit of duties or cess paid on any goods. But the credit of input services is allowed.
MY UNCLE PRODUCED AND SALE ONION RS.32,00,000 FROM HIM OWN AGRICULTURE LAND IN VILLAGE PLACE OF FINANCIAL YEAR 2012-13. NOW HOW MUCH AMOUNT EXEMPTION HE WILL GET BY INCOME TAX ACT 1961. PLEASE GUIDE ME SIR RAJALAKSHMI.G (Posted On: 29 Aug, 2013)

We do not deal in direct taxes hence we are not able to comment on the same.
we are manufacturer and service provider of glow sign board. we are taking cenvat credit of service tax on factory rent.(Rent is Rs.1,50,000/=+12.36%). my vat turnover is 400 lacs and cargable service tax turnover is only 5 lacs. question is can we take cenvat credit or not? manoj (Posted On: 29 Aug, 2013)

As per notification no. 33/2012-ST dated 20-6-2012 exemption is available to a small service provider whose taxable service does not exceed Rs ten lakh. As in above case your taxable service does not exceed ten lakh therefore the exemption is available to you. Also it has been clearly mentioned that in case service provider is claiming exemption he cannot avail the cenvat credit under the cenvat credit rules. But if you decide to forgo the exemption then the credit is available to you.
Service tax liability in case of repair of car where separate bills for service portion and material portion Ramit Kumar (Posted On: 29 Aug, 2013)

The service will fall under the works contract as material and labour are involved. But the works contract valuation rules itself says that first of all, we should bifurcate the material and labour and then the service tax should be paid on labour charges only. Hence, you should pay service tax @12.36% on labour charges.
Sir, We are constructing Residential Building and awarding contracts on labour supply and also with material.Is Contractors providing labour applicable for Service Tax on Reverse Charge.Should we deduct the Service Tax Liability payable from them. Chandan Samal (Posted On: 29 Aug, 2013)

If the material and labour charges are awarded to the contractor then the above service would fall under the work contract. Also the work contract service falls under the reverse charge mechanism if the provider is individual, huf or partnership firm and service recipient is a body corporate. Under reverse charge mechanism, fifty percent liability falls on both service receiver and service provider. Your second query is that the labour contract is chargeable to service tax. We understand that you are asking when a contract is pure labour contract and material is supplied by service recipient then it is chargeable to service tax. The answer is that such contract does not fall under works contract then the reverse charge in this category is not applicable. However, if this activity falls under manpower supply agency then the service tax is applicable. Third query is of deduction of service tax under reverse charge. Unless your agreement provides so, the service tax is not to be deducted but it is to be calculated over and above this amount and paid to the Government.
my uncle birthday is 06/12/1948....he liable to pay profession tax(ptec) for f.y.2013-14...as he complete 65years of age in middle of finnancial year 2013-14...please reply whether he is liablr to pay patc...?? Keval gandhi (Posted On: 29 Aug, 2013)

We deal in service tax, Excise, CUSTOM and DGFT. Ask queries related to them.
Sir, We are 100% EOU.Now we want to clear waste/scrap in DTA sale.What is the procedure follow the clear scrap to Domestic Customers ? Thanking you Raj (Posted On: 20 Aug, 2013)

As per FTP policy 2009-14 you are entitle to sale goods up to 50% of the FOB value of the export subject to fulfillment of positive NFE. You can clear the goods from the units after paying applicable excise duty.
sir, We are 100% EOU,now we want to clear scrap in DTA sale, what is the procedure to clear the same.Thanking you Rajendra (Posted On: 20 Aug, 2013)

As per FTP policy 2009-14 you are entitled to sale goods up to 50% of the FOB value of the export subject to fulfilment of positive NFE. You can clear the waste and scrap to that extent subject to payment to applicable excise duty.
Can principle manufacturer avail credit for the stocks lying in the job workers end. Earlier raw materials sent to job worker on payment of duty or invoice in the name of principle manufacturer delivery to job worker. After credit at job worker end there is no production . Can job worker can pass on the accumulated credit to principle manufacturer. I need your reply K.Srinivasan (Posted On: 20 Aug, 2013)

As per Rule 4(1) of Cenvat Credit Rules, the Cenvat credit in respect of inputs may be immediately on receipt of the inputs in the factory of the manufacturer. Following this analogy, the goods should be received in factory of manufacturer. If this is directly delivered at job worker premises then the credit will be taken by manufacturer on this invoice only after receipt of material from job worker. There is no provision to take the credit of accumulated credit at job worker premises by principal manufacturer. We have given this reply assuming that the principal has issued the challan under Rule 4(5)(a) of Cenvat Credit Rules read with Notification number 214/86-C.E. dated 1.3.1986.
Sir, Whether Duty which is paid under CCR rule 3(5) for as such Clarence can be collected from the buyer? Dayananda K N (Posted On: 19 Aug, 2013)

As per Rule 3(5) of Cenvat Credit Rules, the cenvat credit is to be reversed on as such clearance of inputs. The assessee can collect this reversed duty from the buyer. Even the buyer is also eligible on take credit on the same.
Sir, I had a query regarding calculation of threshold limit of Rs. 10 lacs as specified in Notification No. 33/2012. My Query is whether for the purpose of calculating threshold exemption limit as per the aforesaid notification, whether services in the nature wherein the service receiver is liable to pay service tax shall be considered for calculating the threshold exemption limit? Thanks! Mayank Bang (Posted On: 19 Aug, 2013)

Services covered under complete reverse charge and partial reverse charge has to be included in the calculating aggregate value for service provider except complete reverse charge in case of GTA service as clarified in the notification no. 33/2012-ST itself. The payment received towards the gross amount charged by such goods transport agency where Goods transport Agency is not liable (i.e. receiver liable), shall not be taken into account i.e. for the service receiver in case of gta the ssi exemption is not available.
whether builder of residental flats is require to charge service tax in his invoices to buyers of flat? Manish Dungarwal (Posted On: 19 Aug, 2013)

It has been clearly mentioned in the circular no Circular No. 151 /2 /2012-ST dated 10.02.2012 that the construction service provided by the builder/developer is taxable in case any part of the payment/development rights of the land was received by the builder/developer before the issuance of completion certificate and the service tax would be required to be paid by builder/developers even for the flats given to the land owner. The service tax is to be shown in the invoices raised by builders.
Dear Sir, Thanks for your reply, Please clear was GTA applicable on mustard seed before Notification no 03/2013-ST dated 01.03.2013. Sir, WE BRING MUSTARD SEEDS BY ROAD TRANSPORT TO OUR CRUSHING UNIT AT KOLKATA. MY QUERY IS THAT IS GTA APPLICABLE IN OUR CASE AS THE MUSTARD SEED IS AN AGRICULTURE PRODUCE. Notification no 03/2013-ST dated 01.03.2013 as amended the earlier exemption notification no. 25/2012-st, and the exemption of paying service tax on GTA was extended to the agriculture produce. Agricultural produce has been defined in section 65B of the Act which means any produce of agriculture on which either no processing is done or such processing is done as is usually done by a cultivator or producer which does not alter its essential characteristics but makes it marketable for primary market. It also includes specified processes in the definition like tending, pruning, grading, sorting etc. which may be carried out at the farm or elsewhere as long as they do not alter the essential characteristics. Therefore the above mustard seeds will be covered in agriculture produce and hence exemption will be allowable. However, we would like to decide your case in light of above definition. Nawal Gupta (Posted On: 18 Aug, 2013)

W.e.f. 01.03.2013, services by goods transport agency by way of transport of agriculture produce is exempt. Mustard seed on which no processing is done or processing is done which do not alters its essential character is covered under agriculture produce hence transport of mustard seed is exempt w.e.f. 01.01.2013. Before 01.01.2013, as per Mega Exemption notification, Service provided by a GTA by way of transportation of fruits, vegetables, eggs, milk, food grains or pulses in a goods carriage is exempt of service tax. In our opinion mastered seeds are food grains therefore transportation of the same was also exempt before 01.03.2013.
dear sir is export of services amount will be considered in valuation of 10lakh ssi exemption amount Bharat (Posted On: 17 Aug, 2013)

As per Notification No. 33/2012 – ST, “aggregate value means the sum total of value of taxable services charged in the first consecutive invoices issued or required to be issued, as the case may be, during a financial year but does not include value charged in invoices issued towards such services which are exempt from whole of service tax leviable thereon under section 66B of the said Finance Act under any other notification.” Thus aggregate value includes only taxable services. Export of service is not chargeable to service tax by virtue of section 66B because as per section 66B service tax is leviable on services provided in “taxable territory (i.e. India except Jammu & Kashmir)” only and in case of export of service, taxable territory is normally outside India in accordance with Place of Provision Rules, 2012. As export of services are not chargeable to service tax therefore the same are not included in computing aggregate value of 10 Lakhs.
sir, while submitting service tax return for the period April to September 2013, client fails to submit invoice regarding purchase of capital goods so Cenvat credit on capital goods can not be availed . can Cenvat credit on capital goods can be availed during Service tax return for the period Oct.-March 2013 period Shri Niwas Malani (Posted On: 09 Aug, 2013)

Although there is no time limit fixed for taking of cenvat credit on the inputs, input service or capital goods. However, it is clarified that assessee may avail the credit immediately on receipt of the inputs but nothing has been said about the utilisation of the credit. The credit on capital goods can be taken 50% in first year and balance in second year. There are number of decisions which says that the credit can be taken afterwards. Thus you can mention the same in the details of the return pertains to October to march. Note: Returns pertaining to April 13 and onwards are yet to be filed and returns for the Oct- March 2013 has been already filed.
sir, i have a proprietor ship firm , my firm doing photocopy work. if i have a work contract with any company so tell me percentage of service tax . we also charge VAT. sandeep srivastava (Posted On: 08 Aug, 2013)

Now the photocopy work is neither covered under Negative list and Megha exemption notification. But since you are paying tax then it can be termed as transfer of title in goods then the service tax is not attracted. But it can be argued that the doing photocopy is not only sale of goods but it involves services also. In such a situation, it is composite contract. Following the education guide issued by CBEC, one has to apply dominant nature test. If the dominant is service then service tax is applicable. But in case dominant is sale then no service tax is applicable. Although it is very difficult to comment in such a situation as well as it will always be prone to litigation, but it seems that the sale is dominant in this case and no service tax is applicable.
SIR, ONE OF MY SSI UNIT CLIENT MANUFACTURING READY MADE CHAPPATHI AND PAROTTA. THEY HAVE CROSSED 1.50 LAKHS FOR THE LAST YEAR. THIS YEAR EXPECTED TURNOVER IS MORE THAN 4 CRORES. WHETHER CENTRAL EXCISE IS APPLICABLE TO THIS UNIT OR EXEMPTED rvperumal (Posted On: 08 Aug, 2013)

In case of pre packaged food two exemptions are available: 1) Under notification no. 1/2011-C.E. dt. 1.3.2011 the duty equal to 2% is payable and in such case the cenvat credit on inputs is not available. 2) Under notification no.2/2011-C.E. dt. 1.3.2011 the duty is payable equal to 6% and in that case assessee can avail the cenvat credit. Both the above notifications are mutually exclusive. For availing the SSI exemption in both the cases specified condition of the ssi exemption must be satisfied. Also if you are manufacturing under any brand name of any other person then the SSI exemption is not available. SSI exemption is available if the total clearances in the current year are 150 lakhs with a condition that the total turnover in the previous year is less than 400 lakhs i.e the SSI exemption would be available to you and you won’t have to pay duty up to 150 lakh clearances but after that duty would be leviable. Moreover, one must go through the SSI exemption notification 8/2003-C.E dated 1.3.2003 and as amended to see that all other terms and conditions of notification are satisfied.
Dear sir If we purchase old iron & scrap from the open market and without duty then sagregate it then sale to the manufacturer . 1)wthether there will be any excise duty liability . 2) Whether this process is amount to manufacturer Please advise. Thanks Munesh munesh (Posted On: 07 Aug, 2013)

The most commonly used test for ascertaining "manufacture" for the purpose of attracting Central Excise duty has taken place was evolved by the Supreme Court in the case of Delhi Cloth and General Mills 1977 (1) ELT (J 199). In terms of this decision, the activity or process in order to amount to "manufacture" must lead to emergence of a new commercial product, different from the one with which the process started. In other words, it must be an article with different name, character or use. Thus, a process which simply changes the form or size of the same article or substance would not ordinarily amount to manufacture and no excise duty would be payable unless it is deemed to be manufacture. If in above case there is only transformation in shape and not leading to a distinct product being marketable then this won’t amount to manufacture and duty would not be leviable.
Dear sir I have a question that if we purchase plastic old drums from the market or from the scrap market without excise duty then I cut it into small pieces/grind as granules .. After that I sell to any one now my question is whether this is amount to manufacture and excise duty will be applicable . Suppose, I have an SSI unit then I will have to take excise registration .what is the annually limit of ssi . Kindly suggest for the same . I shall be very thanful to you . Thanks Munesh munesh (Posted On: 05 Aug, 2013)

The most commonly used test for ascertaining "manufacture" for the purpose of attracting Central Excise duty has taken place was evolved by the Supreme Court in the case of Delhi Cloth and General Mills 1977 (1) ELT (J 199). In terms of this decision, the activity or process in order to amount to "manufacture" must lead to emergence of a new commercial product, different from the one with which the process started. In other words, it must be an article with different name, character or use. Thus, a process which simply changes the form or size of the same article or substance would not ordinarily amount to manufacture and no excise duty would be payable unless it is deemed to be manufacture. In the above case as the plastic drums are cut and grinded into granules which are itself marketable under the name granules, therefore, the same would amount to “manufacture”. SSI exemption is available if the aggregate value of clearances in the current year is Less than 150 lakhs with a condition that the aggregate value of clearances in the previous financial year is less than 400 lakhs. This SSI exemption notification 8/2003 is subject to other conditions. If you satisfy all the conditions then you are eligible to SSI exemption and there is no need of Central Excise registration till your turnover is below exemption limit.
Sir, We have taken a premesis on rent for our pre-process of production. we are paying rent for said premises. can we claim input of service tax paying on rent ? Satish Kumar (Posted On: 05 Aug, 2013)

The input service definition states that a service utilised directly or indirectly for providing the output service will be eligible for the cenvat credit. As the RENT is paid towards the RENT of the premises for a pre-process production has a direct link with the final production, therefore eligible.
Dear Sir, Please advise, can we claim CENVAT Credit if we clear goods after repacking and charge of Excise Duty. HS Code of our product is 79040030 Please advise ungently. naren Naren Arora (Posted On: 03 Aug, 2013)

Under the tariff head 79040030, 12% duty is levied. But packing does not amount to manufacture for this product. There is neither any chapter note and nor it is chargeable to MRP based valuation. Hence, you cannot take the credit on the same.
We are in business of manufacturer, supply, erection and installation of Transmission line tower. We have received separate order for supply and erection of transmission towers. Our client insist us to charge service tax on 40% amount of erection charges as per new service tax valuation rules. Our query is that whether we should charge service tax on 40% value of only erection work or should charge on value of supply of tower material + value of free issued material + value of erection work Manish Thakkar (Posted On: 31 Jul, 2013)

There are two methods of valuation in works contract. Firstly, one should deduct the value of material from total value and pay the service tax @12.36% on remaining labour charges. But if one is not able to bifurcate the same then the service tax is payable on percentage of value. Even the free supply material is to be added for arriving such value.
We are in business of manufacturer, supply, erection and installation of Transmission line tower. We have received separate order for supply and erection of transmission towers. Our client insist us to charge service tax on 40% amount of erection charges as per new service tax valuation rules. Our query is that whether we should charge service tax on 40% value of only erection work or should charge on value of supply of tower material + value of free issued material + value of erection work Manish Thakkar (Posted On: 31 Jul, 2013)

There are two methods of valuation in works contract. Firstly, one should deduct the value of material from total value and pay the service tax @12.36% on remaining labour charges. But if one is not able to bifurcate the same then the service tax is payable on percentage of value. Even the free supply material is to be added for arriving such value.
We are in business of manufacturer, supply, erection and installation of Transmission line tower. We have received separate order for supply and erection of transmission towers. Our client insist us to charge service tax on 40% amount of erection charges as per new service tax valuation rules. Our query is that whether we should charge service tax on 40% value of only erection work or should charge on value of supply of tower material + value of free issued material + value of erection work Manish Thakkar (Posted On: 31 Jul, 2013)

There are two methods of valuation in works contract. Firstly, one should deduct the value of material from total value and pay the service tax @12.36% on remaining labour charges. But if one is not able to bifurcate the same then the service tax is payable on percentage of value. Even the free supply material is to be added for arriving such value.
We are in business of manufacturer, supply, erection and installation of Transmission line tower. We have received separate order for supply and erection of transmission towers. Our client insist us to charge service tax on 40% value of erection charges as per new service tax valuation rules. Our query is that whether we should charge service tax on 40% value of only erection work or should charge on value of supply of tower material + value of free issued material + value of erection work? pl. reply. thanks Manish Thakkar (Posted On: 31 Jul, 2013)

There are two methods of valuation in works contract. Firstly, one should deduct the value of material from total value and pay the service tax @12.36% on remaining labour charges. But if one is not able to bifurcate the same then the service tax is payable on percentage of value. Even the free supply material is to be added for arriving such value.
service tax on transportation outward will credit allowable to manufacturer. Uttam (Posted On: 30 Jul, 2013)

The Credit of Service Tax on Outward freight will be allowed if the following 3 conditions are fulfilled: 1. The sale takes place at the buyer’s door or the property in the goods remains with the seller till the goods reaches buyer in an acceptable condition; 2. The risk of damage to goods during the transit is borne by the seller/manufacturer; and 3. The freight charges are integral part of the price of the goods.
Dear Sir, Kindly let me know the person liable in the following case. A COMPANY is purchasing goods by way of a Purchase Order issued on supplier by specifying freight extra at actuals on P.O. Also, the supplier (Manufacturer of goods)(COMPANY) while giving quote for the material supply, clearly specifies that price is ex-factory and mentions that, transportation charges to be borne by purchaser. Now, the purchaser receives the invoice for material value followed by a debit note for the transportation charges paid to the transporter (backed up with consignment note issued by the transporter (GTA/NOT no idea) where supplier co. is the consignor & purchasing co. is the consignee). pls. let me know the liability of supplying/purchasing company w.r.to payment of service tax to the dept. under REVERSE CHARGE MECHANISM if applicable. service tax applicability on payment of freight charges to supplier of goods who's claim is by way o (Posted On: 29 Jul, 2013)

Reverse charge is applicable on transport of goods by road. Here the liability of payment of service tax falls on the person who is liable to pay or pays freight. However, the seven categories of person are liable to service tax under reverse charge as per provision of Rule 2(1) (d)(v) of Service tax Rules. If you do not fall under these categories then the service tax will fall back on transporter. This is subject to exemptions available under GTA services. Therefore in above case the liability to pay service tax will fall on you as you have paid freight. To avoid that liability, one has to prove that the manufacturer is paying the freight as an agent of the buyer. In that case, the service tax liability will fall back on supplier of the goods.
dear air, Please advise, can I avail cenvat credit if I sale my product after change of packing and charge excise duty at the time of sales. HS code of my product is 79040030 naren (Posted On: 28 Jul, 2013)

Under the tariff head 79040030, 12% duty is levied. But packing does not amount to manufacture for this product. There is neither any chapter note and nor it is chargeable to MRP based valuation. Hence, you cannot take the credit on the same.
whether gold refining process from gold jewellery and making of bangles from refined gold and gold biscuits or bars attracts any excise duty?Notification no. 12/2012 CE dated 17/03/2012 under sl no. 188 primary gold converted with the aid of power from any form of gold other that gold ore, concentrate or dore bar attracts NIL duty. will this notification applicable for refining process? whether we have to register with department and file returns? Raghavender upadhyay (Posted On: 28 Jul, 2013)

The entry no. 188 of Notification no. 12/2012 CE dt. 17/03/2012 primary gold converted with the aid of power from any form of gold other than gold ore, concentrate or dore bar is eligible for nil rate of duty. Explanation.-For the purposes of this entry, ―primary gold means gold in any unfinished or semi finished form and includes ingots, bars, blocks, slabs, billets, shots, pellets, rods, sheets, foils and wires. Thus as you are converting primary gold to other form then you will be eligible for the exemption.
sir we are manufacturer of HDPE TARPAULIN, WE ARE GETTING CHARGED OF EXCISE DUTY ON PURCHASE HDPE LAMINATED FABRIC IS IT POSSIBLE TO CLAIM THE EXCISE DUTY WHICH CHARGED ON MY PURCHASE. c ramesh (Posted On: 27 Jul, 2013)

A manufacturer or producer of final products or a provider of taxable service shall be allowed to take credit of excise duty paid on inputs used in manufacture of final product. But in the case of M/s Mohan Sales Corporation v/s CCE, Ahmedabad-I the Tribunal held that the process of stitching, cutting and eyeleting undertaken the appellant does not amount to manufacture. And when there was no manufacturing involved, no excise duty can be imposed on the said product. Therefore, one cannot take credit on inputs in such a case.
AN AUTHORISED SERVICE CENTRE FOR TVS MOTORS LTD. HERE SERVICES WITH / WITHOUT SPARES. THE DEPARTMENT ASKED TO REMIT SERVICE TAX EVEN THOUGH THE AUTHORISED CENTRE'S PROPRIETOR HAS NOT YET REACHED THE TUROVER OF RS.5 LAKHS AND MORE. WHETHER SERICE TAX IS APPLICABLE TO HIM BECAUSE OF BRANDED MANUFACTURER'S SERVICE CENTRE. THE OFFICIALS SAID THE TVS IS BRAND NAME. CLARIFY rvperumal (Posted On: 26 Jul, 2013)

Already answered. As per the notification no. 33/2012-ST dt. 20.6.2012 the threshold exemption of ten lakh is generally allowed on the fulfillment of certain conditions which are mentioned in the notification itself. But if the services are providing under a brand name or trade name then such then the notification will not be applicable to it. But you have to see whether you are providing services under a brand name or not. Moreover, the brand name should be of service provider and not of manufacturer of goods. This is clear from the definition of “brand name” given in the notification. You have to see your query on this aspect.
Dear Sir, Can I take cenvat benefit on items to be sold as such after only re-packing and charge excise duty at the time of sale (after some value addition) ? Please advise ! naren (Posted On: 26 Jul, 2013)

Under Central Excise Act certain processes of packing, repacking, labelling or relabeling has been deemed to be ‘Manufacture' under following two Categories – (a) CETA specifies some processes in the section notes and chapter notes of First Schedules ‘amounting to manufacture'. If any of these processes are carried out, goods will be said to be manufactured, even if as per Court decisions, the process may not amount to ‘manufacture' {section 2(f)(ii)} (b) As per section 2(f)(iii), in respect of goods specified in third schedule to Central Excise Act, repacking, re-labeling, putting or altering retail sale price etc. will be ‘manufacture'. The goods included in Third Schedule of Central Excise Act are by and large same as those on which excise duty is payable u/s 4A on basis of MRP printed on the package. Since product classificaiton is not provided to us, hence you will have to see whether your product fall from the above two catgories. If you are covered under any of the above it will be treated as the deemed manufacture and you will be eligible to take the credit on the inputs. But if your product does not hit by above two categories then you cannot take cenvat credit.
An individual in chennai (taxable territory) earns commission in USD for arranging a buyer (USA) for a seller (UK). Both are in non-taxable territory. Now the question is by applying place of provision rules, whether such commission received in foriegn exchange attracts service tax in Indian soil? rengaraj (Posted On: 26 Jul, 2013)

On the analyses of the place of provision rules generally the place of service receiver is the taxable territory but in case of the Intermediary services services the location of service provider will be the taxable territory. Inermediary service include commission agent for services but does not include commission agent for goods. In this case, the service provider is in Chennai and service recipient (who pays commission- whether UK party or USA party) is outside India. Therefore, if the service provider is commission agent of services then it will fall in intermediary service and place of provision will be taxable territory. But if service provider is commission agnet for goods then place of provision will covered under Rule 3 i.e. place of service recipient. In that casse, it will be outside taxable territory.
Respected sir, We are providing Erection and commissioning services in power plants having capacity more than 1000MW and 4000MW plants Know sir under notification no:12/2012,S.no:507 applies to power sector they said Goods required for setting up of power plant can avail custom duty exemption but i want to know Whether the definition includes capital goods or not i.e.,Cranes are covered or not varun (Posted On: 26 Jul, 2013)

As per entry no. 507 of Notification no. 12/2012-Cus (Tariff) the goods covered under the tariff head 9801 are covered under the said custom duty exemption. As per Circular No. 490/56/99CX dated 25/10/1999 Heading 9801 covers all items of machinery, including prime movers, instruments, apparatus and appliances, control gear and transmission equipment, auxiliary equipment (including those required for research and development purposes, testing and quality control) as well as all components (whether finished or not) or raw materials for the manufactured of the aforesaid items and their components, required for the initial settings up of a unit, or the substantial expansion of an existing unit. Even the notification says that the goods required for setting up of plant. Hence, goods includes capital goods and even the word “setting up” also implies that it will include capital goods.
Sir, We are are a compny awarded the contrect for assitance in various jobs in plant & paying to contractor on items rate basis not on man day basis, wheather it will come under "supply of man power or repair or maintinence services in view of reverse charge mechanisum. (Posted On: 26 Jul, 2013)

For a service to be able to fall in the definition supply of man power supply, it is mandatory that the control and supervision on such man power must lie with the person receiving such service. Although the payment on item rate basis is strong indication that the control and supervision is with service provider only and hence it will not fall under manpower supply agency. However, it will depend on the complete terms and conditions of the agreement.
Dear Sir, WE BRING MUSTARD SEEDS BY ROAD TRANSPORT TO OUR CRUSHING UNIT AT KOLKATA. MY QUERY IS THAT IS GTA APPLICABLE IN OUR CASE AS THE MUSTARD SEED IS AN AGRICULTURE PRODUCE. Nawal Gupta (Posted On: 25 Jul, 2013)

Notification no 03/2013-ST dated 01.03.2013 as amended the earlier exemption notification no. 25/2012-st, and the exemption of paying service tax on GTA was extended to the agriculture produce. Agricultural produce has been defined in section 65B of the Act which means any produce of agriculture on which either no processing is done or such processing is done as is usually done by a cultivator or producer which does not alter its essential characteristics but makes it marketable for primary market. It also includes specified processes in the definition like tending, pruning, grading, sorting etc. which may be carried out at the farm or elsewhere as long as they do not alter the essential characteristics. Therefore the above mustard seeds will be covered in agriculture produce and hence exemption will be allowable. However, we would like to decide your case in light of above definition.
sir, my client working under NTPC and providing civil construction service,manpower supply service and cargo handling service inside the NTPC plant area.The NTPC service tax in refer to the NDC issued by the local sales tax department.example If NDC isuued on the certain work 65% exempted from VAT then NTPC paid service tax on the 65% of the bill value ,the same like goes on for every kind of taxable service which we provided regularly,and the service tax dept demanded service tax on the diff.value of the bill in each taxable service provinded by us , sir pls clarify me to what to do,PLS ammar biswa mohan (Posted On: 25 Jul, 2013)

The decision in a landmark case of BSNL V/S UNION OF INDIA it was held the contracts other than the work contract service and catering services cannot be split up into the service portion and sale of goods. Even the education guide issued by CBEC has also clarified on the same. Thereafter, it says that the dominant nature test is to be applied. If the dominant nature is service then service tax is applicable otherwise not.
sir, can we liable to pay GTA on outword freight (from factory to CFS JNPT)which is paid for export the goods to germany Vijay Argade (Posted On: 25 Jul, 2013)

As per notification no. 31/2012-ST government has exempted an exporter from the payment of whole of the service tax on the input services utilized for the export of the goods. For this purpose, certain conditions specified in the notification itself along with filling of EXP-1 AND EXP-2 must be fulfilled. Alternatively one can pay the service tax on GTA and can file refund of the same later on. Therefore you have these two alternatives but eventually in both case the service tax on GTA of goods to be exported is exempt. Third option lies is to pay the service tax and claim Cenvat credit on input service, if available under Cenvat Credit Rules, 2004.
Our Company is a Manufacture in Hyderabad and our one dealer office in Visakhapatnam,I send goods directly from depot to Customer, can service tax paid on freight outward as cenvat cerdit in factory? Saurabh (Posted On: 24 Jul, 2013)

On the analyses of amended definition of “input services” effective from 1.4.2011, it is clear that credit on freight outward is allowed only if the goods are transported to the place of removal e.g. goods removed to take them to godown etc. in your case. You are sending the goods from depot to customer, therefore the same will not fall in the definition of input services and hence credit will not be allowed.
Sir, an individual started a tvs two wheeler authorised station. Here, he reconditioning the vehicles and replace if any spares. Now, the department asked to pay service tax even though he has not yet touched 5 lakhs and they issued a notice that there is no threshold limit applied to this because this is a branded service station. Now, I want to know whether the service tax applicable to this individual's two wheeler service station rvperumal (Posted On: 23 Jul, 2013)

As per the notification no. 33/2012-ST dt. 20.6.2012 the threshold exemption of ten lakh is generally allowed on the fulfillment of certain conditions which are mentioned in the notification itself. But if the services are providing under a brand name or trade name then such then the notification will not be applicable to it. But you have to see whether you are providing services under a brand name or not. Moreover, the brand name should be of service provider and not of manufacturer of goods. This is clear from the definition of “brand name” given in the notification. You have to see your query on this aspect.
Dear Sir, Is it mandatory to give prior intimation ( before starting to send input for process to new job worker) to assistant commissioner of central excise having jurisdiction over the factory of job worker . Please reply . If the reply is in no kindly give reference of rule, sec & example cases. Nawal Gupta (Posted On: 22 Jul, 2013)

There are two alternative procedure of job work. One is under Notification number 214/86-CE dated 25.3.1986 and as amended and the second is Rule 4(5)(a) of Cenvat Credit Rules, 2004. As per notification no. 214/86 amended from time to time, the undertaking of duty liability is to be given to Deputy Commissioner of job worker. But no such intimation required under Rule 4(5)(a) ibid.
Respected Sir, We had a proprietorship firm recenty we have make a deed to convert into partnershipfirm. now question will the service tax no be changed as we have service tax no.of proprietorship firm. mita mukherjee (Posted On: 21 Jul, 2013)

Registration in service tax is mandatory if you are liable for paying service tax, and the amendment is necessary if there is any change in the information supplied in the form ST-1 , such changes must be informed within a 30 days of changes jurisdictional AC/DC. As there is change in your constitution, the PAN number is changed. The service tax registration is PAN based, therefore you will need to get apply for new registration and a fresh registration code will be issued.
Sir. we had received tooling cost from customer & we had made these tooling & are using for mfg of final product.Also we have made excise invoice to customer for tooling & paid excise duty one time as per request of customer. Now is it mandatory to amortise these tooling & charge amortisation cost to customer in excise invoice in every dispatch ? Yogesh Pawar (Posted On: 21 Jul, 2013)

As you have charged for the tooling and hence the ownership is transferred. But you are using the same tooling for manufacture of our final product then it will be termed as free supply of material by buyer for manufacture of final product. As per valuation Rules, the cost of free supply will be added to the cost of finished goods to arrive correct transaction cost. Since the goods are in capital nature, the amortized value of such tooling is to be added in value of finished goods for payment of excise duty.
We are a registered company and receiving services of construction and repair maintenance of building we would like to know that is the RCM applicable on such cases and what should be classification of such services Mohd Zaheer (Posted On: 20 Jul, 2013)

Reverse charge is applicable on the works contract services if the service receiver is a company and the service provider is an individual, HUF, proprietor or partnership firm, AOP located in the taxable territory. If the material value is included in such service then it fall under works contract and service tax will be payable under “works contract”.
Dear sir I have a query that If we sale/clear our inputs as such on less basic value and pass on excise duty as cenvat credit taken then my query is :- 1.whether there will be any obligation of the excise department/income tax department. Hope for your reply very soon. Thanks Munesh munesh (Posted On: 20 Jul, 2013)

As per Rule 3(5) of cenvat credit rules 2004 when inputs on which cenvat credit has been taken, are removed as such from the factory, or premises of the provider of output service, the manufacturer of the final products or provider of output services, as the case may be, shall pay an amount equal to the credit availed in respect of such inputs and such removal shall be made under the cover of an invoice referred to in Rule 9. Therefore when inputs are removed as such from the factory then it is removed on payment of duty strictly equal to the duty paid when such goods were received in the factory, no matter what is the transaction value. Thus as in your case as the duty element has not been effected thus the same must not be litigated by the department.
Sir, we have to pay commission to Indian agents against export sale.On this commission we have to pay service tax.Sir,please clarify that can we claim refund of service tax on commission paid under notification no. 41/2012 of Service Tax dt 29.06.2012.Because in this notification services are not specified. Also clarify that refund will be granted on commission paid on sale executed after 29.06.2012 or any sale executed before 29.06.2012 but refund of commission on that sale filed after 29.06.2012 is also liable for refund. Thanks CA Parveen Khurana PARVEEN KHURANA (Posted On: 19 Jul, 2013)

As per the notification no 41/2012 except the services mentioned in the amended definition of input service exemptions by way of refund can be availed by a exporter of goods in relation to the service tax paid on the taxable services used for the export of goods. Input service means: The amended definition of input service excludes the following services from the ambit of input service for the purpose of admissibility of credit: (A) Services specified in the following sub-clauses of clause 105 of Section 65 of Finance Act, 1994 (p)- Services provided by architect (zn)- Services provided by port (zzl)- Services provided by other port, (zzm)- Service provided airport (zzq)- Commercial or industrial construction services, (zzzh)- Construction of complex service and (zzzza)- works contract service In so far as they are used for- (a) Construction of a building or a civil structure or a part thereof; or (b) Laying of foundation or making of structures for support of capital goods, except for the provision of one or more of the specified services; or (B) The following Services specified in sub-clauses of clause (105) of section 65 of the Finance Act, (d)- General insurance service, (o)- Rent-a-cab service, (zo)-authorised service station and (zzzzj)- Supply of tangible goods in so far as they relate to a motor vehicle except when used for the provision of taxable services for which the credit on motor vehicle is available as capital goods; It specifically excludes services (C) such as those provided in relation to outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits extended to employees on vacation such as Leave or Home Travel Concession, when such services are used primarily for personal use or consumption of any employee. This amendment will come into force from 1.04.2011 Prior to this notification, notification no.52/2011 was effective and this notification exempted some specified services which were mentioned in the notification itself. On close analyses of list, it can be concluded that commission on sale is not specifically mentioned in the notification thus it will not be allowed prior to 29.06.2013.
sir, whan goods deleverd by truck owner and truck union in a singal truck . what is service tax libility of a corporation ajay kumar meena (Posted On: 18 Jul, 2013)

Goods transport Agency has been defined as “any person who provides service in relation to transport of goods by road and issues consignment note by whatever name called.” Also the exemption available in case of goods transport services is for single consignee up to Rs.750 and for single vehicle up to Rs.1500 is exempt. Therefore in case of goods transported through single truck the exemption available is 1500 if the total of all bilties to a single truck owner does not exceed Rs 1500. However, the truck owner directly provides service and no consignment note is issued due to the reason that there is no agency in between, then the service tax is not payable.
i have paid excise duty on purchases Rs 64.00 lakhs and collected Rs 42.00 lakhs on sales whre should i show the balance CENVAT OF rS 22.00 LAKHS IN bALANCE SHEET AND PROFIT AND LOSS ACCOUNT v srinivasa rao (Posted On: 18 Jul, 2013)

The balance 22 lakh shows the DEBIT balance on CENVAT credit. As per revised schedule VI the balance of Cenvat credit is shown as CENVAT CREDIT RECEIVABLE (INPUT) A/C or CENVAT CREDIT ON CAPITAL GOODS as the case may be in “other current assets” under the main heading of current assets in assets side of balance sheet.
Respected Sir, One of my client is providing construction services for Single Residential Unit on labor contract basis. Whether he will be covered under Service Tax? And if yes under which service he will be covered? Thanks Ramesh Purbia (Posted On: 16 Jul, 2013)

The above service has been specifically exempted from service tax vide notification 25/2012-ST i.e. mega exemption notification.
Respected Sir, One of my client is providing construction services for Single Residential Unit on labor contract basis. Whether he will be covered under Service Tax? And if yes under which service he will be covered? Thanks Ramesh Purbia (Posted On: 16 Jul, 2013)

The above service has been specifically exempted from service tax vide notification 25/2012-ST i.e. mega exemption notification.
Sir, In one case service tax was wrongly collected by the provider of service for the period for which service tax was not applicable.on raising the issue with the provider of service, a refund claim was lodged by the provider of service with the department.It has been turned down by the First appellate authority.The order passed is more than a year old. Now my query is can the recipient who also holds service tax registration in a different place can he claim refund ? If so, In whose jurisdictional office (ie servcie provider/service receiver)Refund claim is to be filed by the receipient ? I think that time bar should not be an issue for refund, since it can be claimed under mistake of law under Limitation Act. Thanking you in advance. Ramani (Posted On: 15 Jul, 2013)

Section 83 of the Finance Act 1994 provides that the provisions of sections 11B of the Central Excise Act, 1944 are applicable to Service tax matters. The refund can be claimed under Section 11B of Central Excise Act. The Section 11Bibid says that any person can claim the refund from whom the duty is collected or paid by him. Hence the service recipient can claim the refund. But the time limit of refund is given as one year in Section 11B. But since we have not paid the service tax, the Madras High Court in case of NATRAJ AND VENKAT ASSOCIATES V/S ACST has held that time limit does not apply to the amount which is not “service tax” at all and court can order refund. However, the view prevailing in this issue is that the High Court can grant waiver from time limit but the adjudication and appellate authorities cannot do so.
SIr, My question is, if the company/ firm is providing service to foreign sellers by selling their ferrous or non-ferrous scrap in india,then whether service tax would be applicable on it?? i am in dilemma because since the service is provided in india, whether it is export of service although the service receiver is based outside india. or whether it will fall under rule 3 of POPS rules.Please clarify sir??? Ankit Khandelwal (Posted On: 13 Jul, 2013)

For a service to be covered under the export of service, Rule 6A of Service tax Rules to be seen. All other conditions are fulfilled in this case but the important condition is that the place of provision of service should be outside India. For deciding place of provision of service, the Place of Provision of Service Rules is to be seen. Rule 3 of impugned rules will be applicable in this case. This rule says that the location of service Receiver is taken as place of provision of service. Since service recipient is located outside India, hence place of provision of service is outside India. Hence, the service will be termed as export of service provided the payment for such service is in convertible foreign currency.
Dear Sir We are sponge iron manufacturing unit.Prsently we working under job work under notification no 214/86 .Should we required to show incoming raw material as well consumption related to conversion job in ER-6. Regards kamal Bandyopadhyay (Posted On: 12 Jul, 2013)

ER-6 return is to be filed on monthly basis; it contains details of principal inputs and manufacturer. Job worker done under notification 214/86 cannot enter the details of job work done in its ER-6 return, as the same will be shown by the principal manufacturer.
Dear Sir We are sponge iron manufacturing unit.Prsently we working under job work under notification no 214/86 .Should we required to show incoming raw material as well consumption related to conversion job in ER-6. Regards kamal Bandyopadhyay (Posted On: 12 Jul, 2013)

ER-6 return is to be filed on monthly basis; it contains details of principal inputs and manufacturer. Job worker done under notification 214/86 cannot enter the details of job work done in its ER-6 return, as the same will be shown by the principal manufacturer.
Dear Sir We are sponge iron manufacturing unit.Prsently we working under job work under notification no 214/86 .Should we required to show incoming raw material as well consumption related to conversion job in ER-6. Regards kamal Bandyopadhyay (Posted On: 12 Jul, 2013)

ER-6 return is to be filed on monthly basis; it contains details of principal inputs and manufacturer. Job worker done under notification 214/86 cannot enter the details of job work done in its ER-6 return, as the same will be shown by the principal manufacturer.
Dear Sir We are sponge iron manufacturing unit.Prsently we working under job work under notification no 214/86 .Should we required to show incoming raw material as well consumption related to conversion job in ER-6. Regards kamal Bandyopadhyay (Posted On: 12 Jul, 2013)

ER-6 return is to be filed on monthly basis; it contains details of principal inputs and manufacturer. Job worker done under notification 214/86 cannot enter the details of job work done in its ER-6 return, as the same will be shown by the principal manufacturer.
as per case law of cadila helth care p. ltd. of gujarat high court. in this connection our range suptd. hase been asking for reverse the service tax credit on foreigh sales commission, after we have reverse the same, the range suptrd. has issued S.C.N.! NOW IT IS POSSIBLE TO ISSUE S.C.N UNDER THIRD PARTY JUDGEMENT. ashok makwana (Posted On: 12 Jul, 2013)

The tribunal is continuously following this judgement. Even in a recent judgement, the CESTAT held that the foreign commission agent is just like Indian commission agent and hence the credit is not admissible.
If the service tax reverse charge is applicable clinical establishment providing exempted service of health care , if the clinical establishment falls in definition of business entity or body incorporate or one of the 7 specified agencies for payment of freight as in case reverse charge these recipients have been made liable for reverse charge for some of the services even though thier output service i e health care services are not subject service tax s s gaur (Posted On: 10 Jul, 2013)

The fact that your output service is exempted cannot change your liability in case of input services. These are two separate transactions. The service tax has to be judged for each transaction.
In case of centralized registration how does one fill service tax return? whether one is required to put details in consolidation or we are still required to show details separately for different branches included in centralized registration? Please provide suitable guidance. Sweta Kalantri (Posted On: 08 Jul, 2013)

Centralised registration is available in case where there is centralised billing or centralised accounting system exists. Therefore in such case all the revenue figures will be consolidated and no branch wise classification will arise. Also the recent ST-3 return format does not contain any branch wise classifications rather the classification is made on services wise.
one of my client is a partnership firm,can firm liable to pay service tax under reverse charge machanism on purchase of sand,kapchi ect. vijaykumar (Posted On: 08 Jul, 2013)

The reverse charge is not applicable on purchase of sand but it it applicable on transportation of sand by road. You have to judge whether the same is purchase of sand or transportation of sand. If it is transportation then the reverse charge is applicable on partnership concern.
hello sir, Please let me know that if i fall under the scope of reverse charge tax under GTA, Car rent and Professional Advocate fees but i am neither an output service porvider nor manufacturing concern, am i liable to register for service tax and pay those service tax under reverse charge mechanism....Kindly revert with your advice.. Thanks ankit mehta (Posted On: 08 Jul, 2013)

In case of goods transport agency service tax is payable under reverse charge mechanism is applicable. If you fall under the specified seven category as mentioned in the provisio to rule 2(d)(B) of service tax rules then you will be liable to pay the service tax under RCM and thus a person liable to pay service tax is mandatory to get himself registered.
SIR, WE ARE A MANUFACTURER TAKING BENEFIT OF SSI EXEMPTION AND THIS IS OUR FIRST YEAR TO START BUSINESS. WE ARE ALSO DOING JOB WORK OF SOME CLIENTS ALONG WITH MANUFACTURING. MY QUERIES ARE : 1. WHETHER TWO SEPARATE INVOICE MADE BY USE FOR MANUFACTURING AND JOB WORKING? OR SAME SEQUENCE MAINTAINED. 2. UPTO 150 LAKHS SALES WE DONT PAY EXCISE DUTY. WE ARE PAYING VAT ONLY. SO WHAT ABOUT JOB WORK CHARGES? HOW WE CHARGE JOB WORK CHARGES? 3. AFTER 150 LAKHS SALES WHEN WE START PAYING EXCISE DUTY AND SUPPOSE WE MAKE JOB WORK TO NON EXCISABLE UNIT WHETHER E.C. CHARGED? IF WE MADE JOB WORK TO REGISTER EXCISE DEALER DOES IT MAKE ANY CHANGE? CA. BHAVESHKUMAR (Posted On: 07 Jul, 2013)

Since you are not registered with the department as operating below Rs. 150 Lakhs then the Rule 11 of Central Excise Rules does not apply on you. This Rule requires that only one invoice book is to be kept. Secondly if the principal giving job work under Rule 4(5)(a) of CCR, 2004 or under notification 214/86 or under notification 83/94 then there is no need to include these job charges for computing aggregate value of Rs. 150 Lakhs. But if non excisable unit is giving job to you and the process undertaken by you amounts to manufacture then the same is to be included into your aggregate value. The sale value of principal will be included in your aggregate value (not only job charges) as per Rule 10A of Vaulation Rules. As said above, the job work done for non excisable unit then the excise duty is to be paid. Similar is the case of job work of excise registered dealer.
sir,we are broker,selling readymade garments is we require any service tax to pay getting comission about 1.5 lakh annually rajendra (Posted On: 07 Jul, 2013)

yes the commission is taxable @ 12.36% but small service provider exemption of Rs ten lakh is available.
Is it required to charge service tax on ground rent received by real estate company ganeshbabu (Posted On: 06 Jul, 2013)

yes service tax @ 12.36 % is payable on the same.
Sir, VCES rule require cash payment towards service tax arrears. Is this cash payment available as cenvat credit in case the tax relate to input services? Your views, sir...regards krsrajan (Posted On: 06 Jul, 2013)

Under the VCES scheme the service tax has to be paid in cash only and service tax credit cannot be utilised. Although the credit on inputs services pertaining to the period for which you are paying service tax can be availed, but it can be utilised for payment of service tax in next period. Also, the credit of such payment is available if the same is allowed as per Cenvat Credit Rules. These issues are also clarified by CBEC in recent circular 170/5/2013 dated August 8, 2013.
Sir, VCES rules require payment of service tax arrears by cash only. Is this cash payment available as cenvat credit in case the service tax dues paid relate to input services? Your view sir krsrajan (Posted On: 06 Jul, 2013)

Under the VCES scheme the service tax has to be paid in cash only and service tax credit cannot be utilised. Although the credit on inputs services pertaining to the period for which you are paying service tax can be availed, but it can be utilised for payment of service tax in next period. Also, the credit of such payment is available if the same is allowed as per Cenvat Credit Rules. These issues are also clarified by CBEC in recent circular 170/5/2013 dated August 8, 2013.
We are the manufacturer, we are paying service tax on transport as a recipient. My query is whether we can pay this liability thru cenvat input? CENVAT AGAINST SERVICE TAX ON GTA (Posted On: 05 Jul, 2013)

It has been clearly mentioned in explanation to Rule 3(4) of Cenvat credit Rules that cenvat credit cannot be utilised for the payment of service tax where service recipient is liable for payment of service tax. This explanation has been inserted by Notification 28/2012-C.E.(N.T.) dated 1.3.2012.
Dear sir, If services from Orissa University of Agriculture and Technology, Bhubaneswar- 751003 on Testing of HPBI 25 SC against BPH AND WBPH of Paddy - Is reverse charge is applicable on Company in the category of support services by govt. or not. I also have a doubt if reverse charge is applicable , then, in negative list of service tax under section 66D (d) (i) Every testing relating to agriculture and agricultural produce is exempted. Our company deals in pesticides, insectides, herbicides and chemicals. Thanks and Regards. DARPAN AGGARWAL (Posted On: 04 Jul, 2013)

As per entry no. D of negative list services relating to agriculture by way of — (I) Agricultural operations directly related to production of any agricultural produce including cultivation, Harvesting, threshing, plant protection or seed testing. Therefore, all services like laboratory testing services, animal feed testing, testing of plants or animals, soil testing etc. in relation to agriculture or agriculture produce which are essential to determine the quality of agriculture or agricultural produce has now kept outside the purview of service tax. Pesticides can be classified under the plant protection therefore well be exempted and therefore the service will be exempted. If the service tax is exempted then there is no question of reverse charge.
Dear sir, If services from Orissa University of Agriculture and Technology, Bhubaneswar- 751003 on Testing of HPBI 25 SC against BPH AND WBPH of Paddy - Is reverse charge is applicable on Company in the category of support services by govt. or not. I also have a doubt if reverse charge is applicable , then, in negative list of service tax under section 66D (d) (i) Every testing relating to agriculture and agricultural produce is exempted. Our company deals in pesticides, insectides, herbicides and chemicals. Thanks and Regards. DARPAN AGGARWAL (Posted On: 04 Jul, 2013)

As per entry no. D of negative list services relating to agriculture by way of — (I) Agricultural operations directly related to production of any agricultural produce including cultivation, Harvesting, threshing, plant protection or seed testing. Therefore, all services like laboratory testing services, animal feed testing, testing of plants or animals, soil testing etc. in relation to agriculture or agriculture produce which are essential to determine the quality of agriculture or agricultural produce has now kept outside the purview of service tax. Pesticides can be classified under the plant protection therefore well be exempted and therefore the service will be exempted. If the service tax is exempted then there is no question of reverse charge.
AS PER RULE 4(7) OF CENVAT CREDIT, ONE CAN TAKE CREDIT OF INPUT SERVICE AT THE TIME OF BILL RAISE, BUT PAYMENT HAVE TO BE MADE WITHIN 3 MONTHS. MY QUERY IS ( BY EXAMPLE) THERE ARE 3 CO'S A, B, C B IS PROVIDING SERVICE TO A AND FOR THAT TAKING HELP OF C. C WILL GET CERTAIN PERCENTAGE ON AMOUNT RECEIVED BY B, BUT C WILL GET MONEY ONLY AFTER AMOUNT RECEIVED BY B. IN THIS IF B TAKES CENVAT CREDIT ON INPUT SERVICE OF C AT THE TIME OF BILLING AND B IT SELF RECEIVE PAYMENT AFTER 3 MONTHS BILL DATE THEN WHAT WOULD BE THE CONSEQUENCES FOR B IN RESPECT OF CENVAT CREDIT??? TandS (Posted On: 03 Jul, 2013)

In respect of Cenvat credit of service tax, if payment is not made to service provider within 3 months, credit is to be reversed. As in your example b has taken the credit on the service received from c, but has not made the payment to him within 3 months. Thus the same has to be reversed.
Colour and polishing work on Packing Spools and Bobbins provided by individual whether falls under Reverse Charge mechanism?What is the liabilites of service receiver as a manufacturing company?? Pradeep Rana (Posted On: 01 Jul, 2013)

Currently reverse charge mechanism in service tax is being applicable on certain specified services and the above service is not one of them. Thus reverse charge would not be applicable on this service and as a service receiver the liability under reverse charge would not arise. Even the works contract service only applies to construction, repair and maintenance and installation and commissioning services only.
Sir/Ma'am, Whether auditor has to qualify the audit report if there is income disclosed u/s 115BBE for which there is nothing available about source or nature? Rakesh Porwal (Posted On: 29 Jun, 2013)

We do not deal in Direct taxes. Please ask queries relating to the Excise, service tax or customs.
Sir, Can we taken full credit on material which is directly supplied to jobworker ? shayan (Posted On: 29 Jun, 2013)

Since excise duty is on ‘manufacture’, duty liability arises only when the goods are manufactured during job work. The test as to whether the process amounts to manufacture or not would be determined by analyzing whether a new article having a distinctive name, character or use emerges or not from the said process in accordance with the decision of the Honorable Supreme Court in Delhi Cloth and General Mills Co. Ltd Vs UOI. Where the goods are manufactured during job work, the job worker would be liable to pay duty of excise on the goods so manufactured unless the principal manufacturer who has supplied him the goods for job work, furnishes a declaration under Notification 214/86 dated 25.03.1986 which exempts goods manufactured by a job worker from duty of excise provided the said goods after job work are returned to the principal or cleared for export or cleared for home consumption on payment of duty of excise. Where the goods are returned to the principal, the principal should either clear it on payment of duty or use it in his manufacturing process which should result in a dutiable product being manufactured. The declaration as stated above should be given to the Assistant Commissioner of Central Excise who has jurisdiction over the factory of the job worker. Thus if the material send by you is received back after job work process and then cleared on the removal of dutiable product then the credit on the duty paid on inputs sent to job worker can be taken.
whether renting of hotel building is liable to service tax as it is excluded from the definition of immovable property ca yogesh k sahrma (Posted On: 27 Jun, 2013)

It seems from the query that the complete hotel is being given by you on rent. Earlier definition of “Renting of immovable property” excluded the same. Hence service tax was not payable. But after 1.7.2012, no such provision exists in negative list or mega exemption notification. Hence service tax is applicable on the same.
One of my client received goods by truck. He pays service tax on the amount of goods received. What will be his liability in case of service tax?? Plz suggest URGENT.. gaurav (Posted On: 26 Jun, 2013)

Reverse charge is applicable on transport of goods by road. Here the liability of payment of service tax falls on the person who is liable to pay freight. However, the seven categories of person are liable to service tax under reverse charge as per provision of Rule 2(1)(d)(v) of Service tax Rules. If you do not fall under these categories then the service tax will fall back on transporter. This is subject to exemptions available under GTA services.
Sir, In our factory premises one new project is coming up for which we have issued various work order e.g for construction building, consultancy as applicable to a business set up.Please advice what are the service eleigible for cenvat credit after the notification issued on 01.04.2011. CMA Ramesh kumar gochhayat (Posted On: 25 Jun, 2013)

The definition of “input service” has now been amended, Rule 2(l) of Cenvat Credit Rules (as effective from 1-4-2011), defines ‘input service’ (relevant for the query) as follows – “input service” means any service, - (i) used by a provider of taxable service for providing an output service; or (ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products up to the place of removal, and includes services used in relation to modernisation, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage up to the place of removal, procurement of inputs, accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services, inward transportation of inputs or capital goods and outward transportation up to the place of removal; but excludes services,- (A) Specified in sub-clauses (p), (zn), (zzl), (zzm), (zzq), (zzzh) and (zzzza) of clause (105) of section 65 of the Finance Act (hereinafter referred as specified services), in so far as they are used for- (a) Construction of a building or a civil structure or a part thereof; or (b) laying of foundation or making of structures for support of capital goods, except for the provision of one or more of the specified services; or Therefore it is clear from above definition that a service covered under works contract relates to the renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises then only the input credit is available. However, the exclusion clause excludes the construction of a building or civil structure. There is dispute in it. The department tries to disallow the credit on construction though it relates to repair or renovation. There is no clarity on the same. But in the instant case, new project is coming up then the credit will not be allowed on construction. It is not clear in query that what type of consultancy is being provided by you?
Sir, Pls guide us the procedures to be adopted after the order passed by Commissioner in relation to Clandestine removal of goods (DGCEI). Also clarify who will pay the penalty amount imposed on senior employes of the company who are still with the company and those who have left the company? RAJIV JAIN (Posted On: 22 Jun, 2013)

The appeal before the CESTAT can be filed against the order of Commissioner. Normally, the person is liable to pay the penalty on which the same is imposed. The department will recover the same from him. Since he was employee of company, the company can pay on his behalf.
Dear Members, One of my client is a dealer of leading motorcycle company. In his premises, he is providing some space to Finance Company's agents. When customer opt for this finance company for finance, Finance Company gives commission to dealer in lieu of space provided. Whether dealer is required to charge Service Tax for providing space and if yes, in which service he would be covered? Thanks. Ramesh Purbia (Posted On: 21 Jun, 2013)

The above matter is under dispute and litigation. The department normally initiates proceedings under the head of Business Auxiliary services treating the amount received as a commission. There are many cases decided either in favour or against. In the case of TRIBHUVAN MOTORS LTD. Versus COMMR. OF SERVICE TAX, MANGALORE [2010 (17) S.T.R. 281 (Tri. - Bang.)] it was held that the portion of premises let out to the finance company cannot be treated as business auxiliary services.
If We are not Service Provider but consume service from other Registrar delar Can we Claim for Service Tax Pritesh (Posted On: 21 Jun, 2013)

As per Cenvat Credit rules 2004, Cenvat credit is available either to a manufacturer of final products or a provider of taxable service. As you are neither service provider, nor manufacturer, credit cannot be availed by you.
Sir, We have paid facebook ads through credit card for our client, and then billed to client, so we have to be payable to service tax under (import of service) and avail cenvat credit that amount Paramasivam (Posted On: 20 Jun, 2013)

The above mentioned activity of paying for display of online advertisements on the website of facebook falls under online information and database access or retrieval services which is covered by Rule 9 of Place of Provision Rules, 2012. As per Rule 9 Place of Provision of Service Rules, 2012, the place of provision of service in this case shall be the location of service provider. As the facebook is a company that is registered outside India, its location is in non-taxable territory. Hence, the transaction would not be leviable to service tax under the reverse charge mechanism. {Query replied by: Ranu Dhoot}
If sponsership services are provided by a company to a firm...then will the firm receiving such services liable to pay ST u/rev chg mechanism OR the co. providing the services will be liable to pay ST...Pls clarify...thanks Saurabh Chokhra (Posted On: 19 Jun, 2013)

Sponsorship services falls under reverse charge mechanism. In this case service provider can be any person and the service receiver is anybody corporate or partnership firm located in the taxable territory. The entire tax is payable by service receiver. If the service receiver is not a body corporate or partnership firm or they are not located in the taxable territory, the service provider i.e. the person receiving the sponsorship money will be liable to pay service tax.
can i know facilities like town,creches, education , rural community development comes under input service as these services are being provided to th employees for motivating them to work properly which help the production indirectly.SO DOES IT COMES UNDER INPUT SERVICES JYOTI KUMARI (Posted On: 19 Jun, 2013)

The facilities stated by you do not directly fall in the definition of input service. Also, the existing definition of input service specifically excludes the expenditure of personal nature incurred for the employees. Due to this, the departmental officers continuously dispute the availment of credit on these services. The Supreme Court has decided in the case of Maruti Suzuki [2009 (240) ELT 641 SC] that unless the nexus is established between the services rendered and the business carried on by the tax payer, CENVAT Credit is not admissible. In view of definition of input service and the decision of Apex Court, the issue is highly prone to litigation and in our view credit should not be availed unless the amount involved is extremely high and we intend to take a stake.
we take work on job work basis where all inputs are given by our clients. our unit is also excisable unit. so who is liable excise duty. and we have liable service tax or not. our product also trademark and patent bhavin kansagra (Posted On: 18 Jun, 2013)

If the work undertaken on behalf of the client amounts to manufacture in terms of section 2(f) of the Central Excise Act, 1944 and the goods are received under a cover of proper job challan, no excise duty is payable by your firm. If the goods are not received by us under a cover of challan and the process amounts to manufacture; then the liability to pay the excise duty lies on us as a job worker. If the process carried on by us does not amounts to manufacture, the service tax is payable by us unless it is otherwise exempted under service tax law.
We are in the business of power generation thru wind mills.For installation of wind mills at remote / forest location we are buying land and subsequently we build road network to connect these wind mills. Road are most critical requirement as these helps in the movement of men/material/vehicles during installation and also for maintenance. For construction of these Roads we use services of civil contractors. For pure labour work involved in Road construction we issue work order with 12.36% of service tax impact and for the material to be used in Road we issue PO on the contractor with applicable VAT. Please advise 1) whether this treatment is in order or this may be treated as works contract under service tax which may have different treatment all together from service tax point of view . 2) If the service provider is non company what will be impact on us if this is considered as works contract. 3) If this Road contract job is considered as works contract , should we enter into work contract , with both labour and supply cost component. Kindly revert with your advise. NILESH BHANDARI (Posted On: 18 Jun, 2013)

Pure Labour Contracts do not fall in the definition of works contract for the purpose of service tax. To fall in the definition of works contract it is necessary that there should be transfer of property in goods involved in the execution of such contract which is leviable to tax as sale of goods. Pure labour contracts are therefore not works contracts. Since such contracts are not works contract, the reverse charge mechanism is also not applicable and the entire service tax is payable by the service provider only. However, even if a small part of material is supplied by the contractor alongwith services, it will come under the definition of works contract and accordingly reverse charge will be applicable if the service provider is an individual/HUF/Partnership firm/AOP. Also, kindly have a note that the services in relation to construction of roads are exempted under entry no. 13 of notification no. 25/2012-ST dated 20.6.2012; w.e.f. 1.7.2012 if the roads are being constructed for use of general public. Thus, if we can prove that the roads in our case are being constructed for use by general public, we can claim total exemption from service tax.
We are in the business of power generation thru wind mills.For installation of wind mills at remote / forest location we are buying land and subsequently we build road network to connect these wind mills. Road are most critical requirement as these helps in the movement of men/material/vehicles during installation and also for maintenance. For construction of these Roads we use services of civil contractors. For pure labour work involved in Road construction we issue work order with 12.36% of service tax impact and for the material to be used in Road we issue PO on the contractor with applicable VAT. Please advise 1) whether this treatment is in order or this may be treated as works contract under service tax which may have different treatment all together from service tax point of view . 2) If the service provider is non company what will be impact on us if this is considered as works contract. 3) If this Road contract job is considered as works contract , should we enter into work contract , with both labour and supply cost component. Kindly revert with your advise. nilesh (Posted On: 18 Jun, 2013)

Pure Labour Contracts do not fall in the definition of works contract for the purpose of service tax. To fall in the definition of works contract it is necessary that there should be transfer of property in goods involved in the execution of such contract which is leviable to tax as sale of goods. Pure labour contracts are therefore not works contracts. Since such contracts are not works contract, the reverse charge mechanism is also not applicable and the entire service tax is payable by the service provider only. However, even if a small part of material is supplied by the contractor alongwith services, it will come under the definition of works contract and accordingly reverse charge will be applicable if the service provider is an individual/HUF/Partnership firm/AOP. Also, kindly have a note that the services in relation to construction of roads are exempted under entry no. 13 of notification no. 25/2012-ST dated 20.6.2012; w.e.f. 1.7.2012 if the roads are being constructed for use of general public. Thus, if we can prove that the roads in our case are being constructed for use by general public, we can claim total exemption from service tax.
We are in the business of power generation thru wind mills.For installation of wind mills at remote / forest location we are buying land and subsequently we build road network to connect these wind mills. Road are most critical requirement as these helps in the movement of men/material/vehicles during installation and also for maintenance. For construction of these Roads we use services of civil contractors. For pure labour work involved in Road construction we issue work order with 12.36% of service tax impact and for the material to be used in Road we issue PO on the contractor with applicable VAT. Please advise 1) whether this treatment is in order or this may be treated as works contract under service tax which may have different treatment all together from service tax point of view . 2) If the service provider is non company what will be impact on us if this is considered as works contract. 3) If this Road contract job is considered as works contract , should we enter into work contract , with both labour and supply cost component. Kindly revert with your advise. nilesh (Posted On: 18 Jun, 2013)

Pure Labour Contracts do not fall in the definition of works contract for the purpose of service tax. To fall in the definition of works contract it is necessary that there should be transfer of property in goods involved in the execution of such contract which is leviable to tax as sale of goods. Pure labour contracts are therefore not works contracts. Since such contracts are not works contract, the reverse charge mechanism is also not applicable and the entire service tax is payable by the service provider only. However, even if a small part of material is supplied by the contractor alongwith services, it will come under the definition of works contract and accordingly reverse charge will be applicable if the service provider is an individual/HUF/Partnership firm/AOP. Also, kindly have a note that the services in relation to construction of roads are exempted under entry no. 13 of notification no. 25/2012-ST dated 20.6.2012; w.e.f. 1.7.2012 if the roads are being constructed for use of general public. Thus, if we can prove that the roads in our case are being constructed for use by general public, we can claim total exemption from service tax.
Is it require to collect c-form for nil tax item sale to outside State? Please note that item not exempted but nil rate. Dharmesh (Posted On: 18 Jun, 2013)

We do not deal in VAT / Sales Tax. Kindly confirm the same from any VAT/ sales tax consultant.
It is a private limited co. is the approval or CentralGovt. needed to pay a salary of Rs.1.50 lakhs pm with perks to its Executive Director. he is not a relative of any director. if he is a wholetime director, i opine that no approval is needed. i need ur guidance mrs. rama s rao (Posted On: 17 Jun, 2013)

We do not deal in Companies Act 1956, therefore we cannot comment on the same.
Can a Company claim credit for the Vat paid on purchase of Computers & its maintenance expenses such as laptop battery in Maharashtra. Vinay (Posted On: 17 Jun, 2013)

We do not deal in VAT / Sales Tax. Kindly confirm the same from any VAT/ sales tax consultant.
Sir, we are manufacture of Material Handling Equipment, we will design as per client requirement. Some of the parts of machinery we will manufacture in our factory and remaining we will directly outsource/buy as per our desing specification. All the parts we will bring to our factory, put the markings/labeling and despatch from our factory to client site. We will assemble all the parts at site and run the equipment. We have doubt we are bying directly from supplier with our specification/design and with their materia, whether it is acceptable or not as per law. Ram Ramesh (Posted On: 17 Jun, 2013)

Your query is not clear thus we assume that you are asking about the levy of excise duty on goods directly purchased from buyer, assembled and then removed to the client site. The Section 2(f) of the Act defines the term "manufacture" in an inclusive manner so as to include any process: (i) Incidental or ancillary to the completion of a manufactured product; and (ii) Which is specified in relation to any goods in the Section or Chapter notes of the Schedule to the Central Excise Tariff Act, 1985 as amounting to manufacture; and (iii) Which in relation to goods specified in the Third Schedule to the Central Excise Tariff Act, 1985, involves packing or repacking of such goods in a unit, container or labelling or re-labelling of containers or declaration or alteration of retail sale price or any other treatment to render the product marketable to consumer. (The clauses (ii) and (iii) above are termed as ‘deemed manufacture’.) The aforesaid definition gives a wider content to the expression "manufacture" as several processes which would not ordinarily be understood as amounting to manufacture are specifically included therein. However, the most commonly used test for ascertaining "manufacture" for the purpose of attracting Central Excise duty has taken place was evolved by the Supreme Court in the case of Delhi Cloth and General Mills 1977 (1) ELT (J 199). In terms of this decision, the activity or process in order to amount to "manufacture" must lead to emergence of a new commercial product, different from the one with which the process started. In other words, it must be an article with different name, character or use. Thus, a process which simply changes the form or size of the same article or substance would not ordinarily amount to manufacture and no excise duty would be payable unless it is deemed to be manufacture as follows: 1. In a particular case by a section or Chapter note of the Tariff; or 2. In relation to goods, which are specified under MRP based assessment under section 4A, packing or repacking of such goods, labelling or re-labelling of containers including declaration or alteration of retail sales price shall amount to manufacture. Thus Excise duty is leviable if the manufacturing process is carried out. It is to be checked at your end whether the process undertaken by you amounts to manufacture or not?
Please clarify that services provided by hospitals to the patients whose claims satisfied by insurance companies(or any other business entities) is taxable under service tax. ganesh (Posted On: 17 Jun, 2013)

The health care services provided by the hospitals are exempted by virtue of entry no. 2 of the notification no. 25/2012-ST dated 20.6.2012. This notification simply exempts the health care services (cosmetic surgery or plastic surgery or hair transplantation is not included) on the grounds that these are provided by clinical establishments. This notification does not put any such condition regarding settlement of claims by insurance companies or any other business entities. Thus, the exemption under this notification will be unaffected by the fact that the patients are being reimbursed by the insurance companies or any other business entities.
DEAR SIR, ONE OF OUR CLIENT IS ENGAGED IN THE BUSINESS OF PROVIDING PURE LABOUR SERVICES TO PUNJAB STATE POWER CORPORATION LTD IN WHICH THE MATERIAL IS PROVIDED BY PSPCL AND THEY ARE DRAWING LINES SHHIFTING LINES ON BEHALF OF PSPCL WHETHER THE CONTRACTOR IS LIABLE TO PAY SERVICE TAX AND UNDER WHAT HEAD WE SHALL GET OURSELVES REGISTERED AND WHAT WOULD BE THE TAX LIABLITY IF THE TOTAL CONTRACT IS FOR rS. 1 CR AMAN SOOD (Posted On: 16 Jun, 2013)

Pure Labour Contracts do not fall in the definition of works contract for the purpose of service tax. To fall in the definition of works contract it is necessary that there should be transfer of property in goods involved in the execution of such contract which is leviable to tax as sale of goods. Pure labour contracts are therefore not works contracts; as such, the service tax would be payable on the total value of services (i.e. on Rs. 1 cr.) at the rate of 12.36%. The registration for drawing lines or shifting lines is required to be taken in the head of Erection, Commissioning & Installation services (clause zzd).
good evening sir, can you tell me about notification no. 214/86 of excise . who will submit this letter under this notification 214/86 and why. please reply rajiv (Posted On: 15 Jun, 2013)

Excisable goods can be sent on job work without payment of duty under notification no. 214/86-CE. For the purpose of this notification, the goods are to be sent under a cover of challan and the job worker can also send back the goods after processing without payment of duty. As given in this notification, the supplier of goods for job work is required to give an undertaking to the jurisdictional Assistant/Deputy Commissioner of Central Excise of the job worker. The letter moved by the supplier should include the undertaking that the supplier will use the goods received after job work in manufacture of excisable goods which will be cleared in accordance with the provisions of this notification.
good evening sir, can you tell me about notification no. 214/86 of excise . who will submit this letter under this notification 214/86 and why. please reply rajiv (Posted On: 15 Jun, 2013)

Excisable goods can be sent on job work without payment of duty under notification no. 214/86-CE. For the purpose of this notification, the goods are to be sent under a cover of challan and the job worker can also send back the goods after processing without payment of duty. As given in this notification, the supplier of goods for job work is required to give an undertaking to the jurisdictional Assistant/Deputy Commissioner of Central Excise of the job worker. The letter moved by the supplier should include the undertaking that the supplier will use the goods received after job work in manufacture of excisable goods which will be cleared in accordance with the provisions of this notification.
Whether Customs SAD 4% refund is admissible if the local sales tax is exempted / goods imported are covered under exempted list of sales tax Satya Narayan Panda (Posted On: 13 Jun, 2013)

No, refund of 4% SAD is not admissible if no VAT / Sales tax is payable on the imported goods. The basic condition for allowing the SAD refund under Notification No. 102/2007-Customs dated 14.9.2007 is that the imported goods are also subject to levy of VAT/Sales tax.
whether service tax will be charged on bill raised on 100% EOU. mukesh (Posted On: 13 Jun, 2013)

Yes, service tax has to be charged on the bill raised on 100% EOU as no specific exemption has been given in respect of services provided to EOUs. However, 100% EOU can file refund of service tax so paid under rule 5 of the Cenvat Credit Rules, 2004.
Sir , if we dispatch goods under Notification 33/CE dt.09.07.2012( Dispatch under SHIS License )do we have to pay excise duty @ 6 % under Rule 6 ? MEHUL SHAH (Posted On: 10 Jun, 2013)

This notification allows the holder to get cleared the capital goods without cash payment of duty. However, the duty involved in the capital goods is debited at the back of the scrip. Thus, the capital goods so cleared are not actually exempted, but the duty payable on the same is not paid in cash and it is debited in the scrip. As such, it cannot be termed as exempted clearances. Also, this is similar to removal of goods against Annexure-1 or CT-2. Thus, no reversal is required under rule 6 of Cenvat Credit Rules, 2004.
Sir , if we dispatch goods under Notification 33/CE dt.09.07.2012( Dispatch under SHIS License )do we have to pay excise duty @ 6 % under Rule 6 ? MEHUL SHAH (Posted On: 10 Jun, 2013)

Already answered.
Sir , if we dispatch goods under Notification 33/CE dt.09.07.2012( Dispatch under SHIS License )do we have to pay excise duty @ 6 % under Rule 6 ? MEHUL SHAH (Posted On: 10 Jun, 2013)

Already answered.
Being a builder we have taken services from advocates whose turnover is above exemption limit.Still there are no activity as such in company as we are still in process of procuring land. Whether we are liable to pay service tax under reverse charge mechanism for taking legal and professional fees from advocates even if we havnt earned any income yet? Please reply Pinky Singhvi (Posted On: 10 Jun, 2013)

Reverse charge is applicable in case of legal consultancy service if the service is provided by an Advocate or by a firm of advocates. However notification no. 25/2012-ST dated 20.6.2012 [serial no. 6(b)(iii)] exempts services provided by an individual as an advocate or a partnership firm of advocates to a business entity with a turnover upto Rs ten lakhs in the preceding financial year. Since there was no income in the company in the preceding financial year, the legal services availed by it will get exemption under this entry. Since the service is exempted, there is no question of applicability of Reverse charge mechanism.
Sir, We are registered as manufacturer under central excise. After clearing the goods (raw material)from custom area we had directly sold it to third party without bringing it into our factory premises i.e. sale as such. So we have drawn only tax invoice and not excise invoice. Sir, my query is whether the Cenvat Credit of Bill of entry cleared by us be taken by the purchaser if we endorse the same. RAJIV JAIN (Posted On: 07 Jun, 2013)

Cenvat credit can be availed on the basis of an invoice/bill of entry as per rule 11 of the Central Excise Rules, 2002. However, the invoice/bill of entry should have certain details as given in this rule. One such detail is that the name and address of the consignee should be mentioned on the invoice. In our case, the name and address of consignee (i.e. actual user) is not mentioned in the invoice. Therefore, department may dispute on availment of credit by the buyer. Further, there is no such provision in Central Excise Act or rules for endorsement. However, there are a no. of cases wherein credit has been allowed by Tribunal on the basis of endorsement and to the satisfaction of the condition that the material under that invoice/bill of entry has been used by the endorsee in or in relation to manufacture of final product.
I am going to purchase an apartment house. I required the following clarifications. 1.Service tax is applicable whether only at the time of Registration or at the time of hand over the apartment? 2) Car Parking is inclusive of service tax? 3)I have made payments from Sep 2010. Just I want to know the rate applicable at the time of payment or reciept time of flats? 3)Is service tax attracts on Car parking area? rvperumal (Posted On: 03 Jun, 2013)

1) The payment of service tax depends on the nature of the sale i.e. if you are buying a apartment under construction and payment is being made in installments then ST is applicable. But the completed apartment is being purchased (after issuance of completion certificate by competent authority) then no service tax is applicable. Supposing there is ST liability on you then as per the provisions of service tax, w.e.f. April 1, 2011 service tax is liable to be paid on accrual basis or receipt basis whichever is earlier. But the construction of complete complex takes a long time then it will fall under continuous service. The point of taxation will be every point when the payment is due as per agreement with the builder. Hence, the service tax will be payable on each such time. 2) Certain services were listed in the negative list as well as in the mega exemption notification no. 25/2012-ST dated 20.6.2012 which were exempted. One such service listed in the mega exemption notification was “Services by way of motor vehicle parking to general public excluding leasing of space to an entity for providing such parking facility” was also exempted. However from this budget, this exemption has also been removed. Hence the Car parking will be chargeable to tax. 3) We are unable to comment on the third query as it looks a bit unclear on reading and the question raised is not clear.
Sir,We are manufacturers of machineries.We provide warranty for our machineries free of cost.Also undertake comprehensive AMC contracts. We pay vat under presemtive basis @ 75% of the contract value. We are not able to quantify the value of the material at the time of entering/receiving AMC charges.on what amount we should pay service tax assuming amc value is RS 6000/- per year. Pl clarify Ramani (Posted On: 03 Jun, 2013)

AMC contracts fall under the category of works contract service. It is presumed that there is transfer of right in property coupled with labor charges. As far as the valuation is concerned, the value of works contracts is gross value charged under contract as deducted by the value of material, if any. In your case where the quantum of material can’t be determined, you can avail the benefit of various abatements provided under this service. 70% abatement is available on repair maintenance of goods i.e. movable property. As you are providing AMC services of plant and machinery you shall be eligible for this abatement rate. Assuming the value of AMC is Rs 6000/- the service tax shall be: 6000*70*12.36% = 519/-. It is worth noting that works contract service comes under reverse charge. Thus if the service receiver is a business entity registered as a body corporate and you are person other than body corporate then you have to pay service tax @50% i.e. Rs 260/- only.
D/Sir,One of our client is paying service tax 12.36% from July 2012 on RENTING OF IMMOVABLE PROPERTY SERVICE because he is crossed the exemp.limit Rs.10/-Lac. My question is : Can assesse claim any abatement against his service tax (i.e.12.36%). Kindly give your valuable advise ... Thanks & Regrads, Kalpana Singh kalpana singh (Posted On: 03 Jun, 2013)

No, there is no such abatement available on provision of service of renting of immovable property.
In an Manufacture Concern assessee has not take Excise Import Licence for Importing R/M Now They are selling these material as finished product & charged & not passed Excise duty in past sales ...So please suggest me proceeding for taking license. Vishvas Mistri (Posted On: 03 Jun, 2013)

There is no such license called Excise Import license. Although there is a license called Import Export License which is to be obtained by importers/exporters of goods. The procedure for the same is as follows: An application for grant of IEC number shall be made by the Registered/Head Office of the applicant and apply to the nearest Regional Authority of Directorate General Foreign Trade, the Registered office in case of company and Head office in case of others, falls in the ‘Aayaat Niryaat Form - ANF2A’ and shall be accompanied by documents prescribed therein. In case of STPI/ EHTP/ BTP units, the Regional Offices of the DGFT having jurisdiction over the district in which the Registered/ Head Office of the STPI unit is located shall issue or amend the IECs. Only one IEC would be issued against a single PAN number. Any proprietor can have only one IEC number and in case there are more than one IECs allotted to a proprietor, the same may be surrendered to the Regional Office for cancellation. Rest of your query is not clear. Hence, we request you to submit your query in simple words so that we can answer the same.
Sir,If a company or individual taking contract for event or film shooting or cultural event and in that case if he is paid by service receiver the amount including his reimbursement of expense, then for assessing service tax what amount would be considered ? Gross or only those part which he received as his remunaration MEHUL SHAH (Posted On: 03 Jun, 2013)

The Service Tax valuation rules states that reimbursement of expenses (often termed as out of pocket expenses) are charges for taxable services and are includible. However as per rule 5(2) of Service Tax (determination of value) Rules, 2006, expenditure or cost incurred by service provider is not includible only if he is acting as a pure agent and all the following conditions are satisfied:  The service provider acts as a pure agent of the recipient of service when he makes payment to third party for the goods or services procured;  The recipient of service receives and uses the goods or services so procured by the service provider in his capacity as pure agent of the recipient of service;  The recipient of service is liable to make payment to the third party;  The recipient of service authorises the service provider to make payment on his behalf;  The recipient of service knows that the goods and services for which payment has been made by the service provider shall be provided by the third party;  The payment made by the service provider on behalf of the recipient of service has been separately indicated in the invoice issued by the service provider to the recipient of service;  The service provider recovers from the recipient of service only such amount as has been paid by him to the third party; and the goods or services procured by the service provider from the third party as a pure agent of the recipient of service are in addition to the services he provides on his own account.
Want to pending list of duty drawback EGM/STUFF/STUFF ALLOW ACT. satishrai (Posted On: 02 Jun, 2013)

We are unable to comment on the same as the query is not clear. We request you to kindly post your query in simple but clear words.
In case if annexure 19 is not filed on on some month i.e. Sept, Jan & Aug (NIL return) how much late filling fees to be paid or what penalty can depart Rekha S Ghadage (Posted On: 31 May, 2013)

There no provision regarding late fees and penalty for late filling of annexure 19
Sir ji. Pl. clarify whether CENVAT is available to corporate assessee for WCS where service provided by non corporate(50%) to corporate visu iyer (Posted On: 31 May, 2013)

The credit of service tax paid on works contract service is available to corporate assessees on the basis of invoice of non corporate assessee wherein he has charges service tax @ 50%. The rest of service tax paid by corporate assessee himself is also available on the basis of challan. This is allowed subject to definition of input service given under 2(l) of Cenvat credit Rules. The works contract service mainly covers construction, repair and maintenance and installation and commissioning services. The credit on construction of building or civil structure is clearly excluded from the definition. Likewise, the repair and maintenance of vehicle is also excluded. Since the type of service is not given in the query, you have to judge at your own.
MY COMPANY'S TURNOVER IS RS 10 LAKH IN FY 2010-11 SO CAN LIABLE TO PAY EXCISE DUTY? Vishal (Posted On: 30 May, 2013)

As per Exemption Notification No. 8/2003-CE Dt. 01.03.2003, if the turnover in the preceeding financial year does not exceeds the limit of Rs. 400 Lakhs, then there is no liability to pay excise duty upto the limit of 150 lakhs in the current year. Thus it is clear that your turn over being less than the statutory limit, you are not liable to pay excise duty as of now. This is subject to condition that your product is covered under the aforesaid notification and you comply with other terms and conditions of the same.
Dear Respected Sir With due respect, My query is in relation to reverse charges liability of corporate entity if it is service receiver in following matter:- 1- Legal Service- corporate entity is receiving legal service from an individual advocate of Rs 500000/- during the f.y.13-14 and it has received service for Rs 500000/- during f.y.12-13. whether it is liable under 30-2012 reverse charges or it can claim serial no: 6(b)iii of notification no: 25-2012. 2- Work Contract- a work for fabrication is given by a corporate entity to a individual contractor with the term and condition that all the material will be given by corporate entity even welding machine and welding road used in fabrication work. No material will be used by contractor during work. There is nothing transfer of any property taxable under sales tax. Please guide it will cover under work contract because if it will cover work contract we have to pay service tax. The control and supervision will also remain with contractor. thanks Your CA Praveen Bansal Mathura M-9411854723 CA Praveen Bansal Mathura (Posted On: 30 May, 2013)

Regarding your first query, you are liable to pay service tax under reverse charge mechanism for obtaining legal services. For the F.Y 2012-13, you have to pay tax on services received after 1st July, 2012 onwards only. Exemption under the serial no. 6(b)(iii) of mega exemption notification can be availed only if the turnover of the entity is less than Rs 10 lacs. Regarding your second query, please consider the fact that under works contract service, there has to be transfer of material from the provider to recipient. . In instant case, as the service provider will be charging only labour charges from you and there is no transfer of material then it will be termed as pure labour contract. Hence, no liability under reverse charge shall be incurred by you.
During the course of departmental audit it was observed that the service provider didnot claim SSI exemption for the first three quarters , but he claimed the same in the last quarter.....but deptt has raised objections and demanding differential tax ...... Please suggest any remedy available to challenge the audit objection? Thanks in Anticipation... Saurabh Chokhra (Posted On: 28 May, 2013)

The threshold exemption under Notification 6/2003 is an optional exemption notification. It provides an option to assesse either to avail this exemption or to forgo the same. But once the same is forgone then we cannot avail this notification in same financial year.
During the course of departmental audit it was observed that the service provider didnot claim SSI exemption for the first three quarters , but he claimed the same in the last quarter.....but deptt has raised objections and demanding differential tax ...... Please suggest any remedy available to challenge the audit objection? Thanks in Anticipation... Saurabh Chokhra (Posted On: 28 May, 2013)

In Small service provider exemption (current notification no. 33/2012-ST dated 20.6.2012), it is clearly mentioned that the exemption is optional and a service provider may not opt for it and he may pay the service tax. However, there is a condition in this notification which says that once the service provider opts not to avail this exemption and starts paying the service tax, this option cannot be withdrawn during the remaining part of the year.
Service tax paid under reverse charge on freight on Raw material sent to Job worker for further process on sale basis i.e as such clearance.Whether cenvat credit of service tax paid of freight available as input service or not.Pl also quote some legal provisio in support of your reply Sunil Bhageria (Posted On: 27 May, 2013)

We have sent the raw material to job workers premises from where it is to be sold further after completion of job work. In this case, place of removal of goods is the premises of job worker. Therefore, the freight so paid falls under the definition of input services as given in rule 2(l) of the Cenvat Credit Rules, 2004. Therefore, credit of service tax paid on the freight is allowed.
Pl let me know whether full service tax(12.36%) is to be shown in the invoice by the service provider providing services covered under reverse charge or only service providers's share of service tax Ramani (Posted On: 26 May, 2013)

He has to show only the portion which he is liable to pay service tax.
2 years back i had already taken cenvat credit but forgot to show it in retun. how can i represent it now??? please suggest.. gauri (Posted On: 25 May, 2013)

In the query, it is not specified, whether you are service provider or a manufacturer. Please note that in case of service provider, the return can be revised after 90 days but there is no such provision in the Central Excise. Intimation of mistake is given to the department in central excise law. But it is very surprising as in such a case, the figures of Cenvat register and return cannot tally in any case. So, how come this mistake remains hidden for two years?
Thank you sir for resolving my query regarding ER-7, sir pl. let me know the time limit for filing ER-7 kailas patil (Posted On: 25 May, 2013)

It is to be filed by April 30 every year.
Sir, My Unit is 100% EOU. I receive Invoice from my freight forwarder/clearing agent/transporter inclusive of service tax. weather my unit(100% EOU) is liable to pay service tax to freight forwarder? if yes, shall i claim the refund of service tax ? CA Pars patel (Posted On: 23 May, 2013)

There is no direct exemption to 100% EOU from service tax. The service provider will charge the same in his invoice. If the services falls under the definition of "input service" then you can take the credit on the same. Else, if it is relating to export then the refund of service tax can be claimed.
Sir,we are manufacturer of pvc pipes & filing er-1 monthly basis& paying excise duty centvat+pla 50lacs please let me know we are liable to file ER-7 return & ER-8 return KAILAS (Posted On: 22 May, 2013)

ER-7 is applicable on every registered manufacturer but ER-8 is to be filed by manufacturer who are paying concessional rate of duty of 2% under notification 1/2011.
Sir, We are running an educational institution regd under Sec 12AA of IT Act. Are we exempted from paying Service Tax in respect of construction of college buildings by virtue of Item No. 13(c) of Mega Exemption Circular. Pls advice. Regads Srinivasan N (Posted On: 20 May, 2013)

Sr. no. 13(c) of mega exemption notification no. 25/2012, exempts the Services provided by way of construction, erection, etc. of a building owned by an entity registered under section 12 AA of the Income tax Act, 1961(43 of 1961) and meant predominantly for religious use by general public. As per your query you are using the building for providing the education services, not for the religious purpose used by general public, hence this exemption is not available to your educational institute.
Can a assessee take CENVAT on the tax paid under Reverse Charge on import of service. Pl. advise..!! visu iyer (Posted On: 19 May, 2013)

yes, he is eligible to take credit subject to condition that the same is allowed as per "input service" definition given under 2(l) of Cenvat Credit Rules, 2004.
Sir One of our client is a charitable trust running educational institutions and is enjoying Sec.12A exemption under the income tax act. My question is : In respect of security, cleaning and manpower serices obtained by the trust from specified perosons whether they are liable to pay service tax under Reverse Charge mechanism. I strongly believe that they are not liable since they do not fall within the definition of body corporate registered as a business entity as per the said notification. Kindly give your valuable advise a r s krishna rao (Posted On: 19 May, 2013)

Your version is correct. Trust does not come in the definition of "body corporate".
I HAVE DTA MANUFACTUER AND I EXPORT GOODS THROUGH ARE-1 TO SEZ AND SEZ CUSTOMER QUALITY PROBLEM IN GOODS AND THEY WANT TO WHOLE GOODS PREMANENTALY RETUNED WHAT IS THE PROCEDURE ? SHELENDRA (Posted On: 18 May, 2013)

There is no prescribed procedure for bringing goods from SEZ. But it is equated with physical exports. Hence, on return, you have to give D-3 intimation to Central Excise officers and enter the same in non duty paid RG-1 register.
Sir, we are using tools manufactured by us on behalf of customer.Ownership of these tools ( Dies & Fixtures) is of customer. Now tell me how can i calculate amortization cost( whether it is calculate on No. of stroks or No. of components produced by using these tools)Please explain me how to calculate amortisation value? Yogesh Pawar (Posted On: 18 May, 2013)

Yes, the amortised value is to be taken. It is to be taken on the basis expected number of components to be produced with this dies. It has to be linked with finished goods produced with this tools.
Sir, if residential complex started construction before 1st July,2010 and such project is more than 12 units than and collecting amount as advance from customer before completion of construction than service tax applicable from where ......???????? pradip (Posted On: 18 May, 2013)

The exemption was provided to payment received prior to July 2010. Further, as per our opinion, the ST is applicable on construction undertaken after the date of July 2010. Hence, a certificate from Chartered Engineer is to be taken for completion before that date.
Sir in case of change in rates, whether service tax rate is determined by section 67A of finance act 1994 or rule 4 of Point of taxation rules.Where section 67A will apply. Thanks Deepak Gupta deepak (Posted On: 16 May, 2013)

Rule 4 of POT Rules, 2011 determines point of taxation in cases where there is a change in effective rate of tax in respect of a service. Whereas, Section 67A of the Finance Act, 1994 determines the rate of service tax, value of a taxable service and rate of exchange. Thus, for calculating service tax rate, Section 67A shall apply.
Dear sir, we are manufacturer of pvc pipes & paying cenvat + PLA 48 lacs p.a. our annual T.O. is 7.80 coror we are filing ER-1 monthly basis. Please let me know whether we are liable to file any other return under excise law. KAILAS (Posted On: 13 May, 2013)

Already Answered.As per Notification No. 17/2006-Central Excise (NT), dated 01.08.2006, as amended, issued under Rule 12(2)(b) of the Central Excise Rules, 2002, inter alia, exempts assessee who paid duty of excise less than Rs. 1 crore in the preceding financial year, from filing the ER-4 return. Similarly, Notification No. 39/2004 Central Excise (NT), dated 25.11.2004, as amended, issued Rule 9A(4) of the CENVAT Credit Rules, 2004, exempts the specified class of manufacturers who paid duty of excise less than Rs. 1 crore in the preceding financial year, from filing ER-5 declaration and ER-6 return. Thus you need not to file ER-4 , ER-5 and ER-6 return
sir my company is a meat processing factory and than export the frozen foods to other country and but the p.y we start ti installed SLAUGHTER/ETP/REFGERATION UNIT FOR THE PURPOSE TO EXPORT FROZEN FOODS TO OTHER COUNTRIES.SO I WANT TO TAKE INPUT VAT ON MACHINERY FOR WIP AS REIMBURSE IN THE CURRENT YEAR 50%.THIS IS CORRECT OR NOT PLEASE GUIDE ME ayesha (Posted On: 11 May, 2013)

We do not deal in VAT. Thus, we will not be able to comment on the same.
Sir I am going to start with a private limited company providing pre-school (Kindergarten) service and also services such as training and development, business stratergy, etc. There are two different units of which one is Pre-school business and other is training and development. The querry is, do I need to charge service tax in pre-school business? The other unit of my business which is training and development are taxable under service tax perview but do I also need to charge service tax in pre school business? Hussain Umrethwala (Posted On: 10 May, 2013)

As per sec 66D ENTRY NO. (l) Services by way of pre-school education and education up to higher secondary school or equivalent have been exempted from the levy of service tax. Hence, you need not to charge service tax on pre- school service.
Dear Sir One of our Prop. Firm is working as a sub-contractor of steel binding on labour rate i.e Client is providing us material and we are doing work. The labour is in our supervision and we are issuing invoice on per Mt. Tone /area basis. Sir Please tell us in which category of service tax we will falls. dinesh negi (Posted On: 09 May, 2013)

The further details of work to be done, place of work etc. are required to classify the same. But it will not fall under works contract as own material is not used by us.
Sir, We are paying service tax on inward freight under reverse charge Notification and claiming abetment 75%. We are despatching material to our customer. GTA is charging Service tax on outward despatch. My question is what will be service tax position if freight paid by us or freight paid by customer. Consignment Note is in name of customer? S.P.Gupta (Posted On: 07 May, 2013)

In case of GTA service tax is payable on reverse charge basis. The person who is liable to pay freight, is liable to pay service tax as per Rule 2(1)(d) provided he falls under seven categories. But if the person making the payment does not fall under any of seven categories then the liability pay service tax is on the transporter.
Dear sir, My company is a IT Company in Pune, We have to pay the service tax to our landlord. The owner will file service tax in his own name. Can we use that service tax in set off in our business. Darpan Gupta (Posted On: 07 May, 2013)

Input service means any service, used by a provider of taxable service for providing an output service. The CENVAT credit in respect of input service shall be allowed, on or after the day which payment is made of the value of input service and the service tax paid or payable as is indicated in invoice, bill or, as the case may be, challan referred to in rule 9. Thus if you are providing taxable service then you can take the credit of service tax paid on input services.
Suppose a company purchase capital goods and taken cenvat cr.50% and return it within 180 days due to some problem then is interest chargable on portion of cr taken or not Shyam Kumar (Posted On: 06 May, 2013)

Already Answered. If the capital goods, on which CENVAT credit has been taken, are removed after being used, the manufacturer or provider of output services shall pay an amount equal to the CENVAT credit taken on the said capital goods reduced by the percentage points calculated on the straight line basis as specified below for each quarter of a year or a part thereof from the date of taking the credit , namely: 1. For computers and its peripherals,: a. For each quarter in first year@10% 2. For capital goods other than computer and its peripherals@ 2.5% for each quarter. Provided that if the amount so calculated is less than the amount equal the duty leviable on the transaction value, the amount shall be equal to the duty leviable on the transaction value. Moreover, if the capital goods are removed in the same year then he should take the balance 50% credit and then remove the capital goods under an invoice issued under Rule 11 after reversing ht credit as per provisions narrated above. But no interest is payable on the same.
Suppose a company purchase capital goods and taken cenvat cr.50% and return it within 180 days due to some problem then is interest chargable on portion of cr taken or not Shyam Kumar (Posted On: 06 May, 2013)

If the capital goods, on which CENVAT credit has been taken, are removed after being used, the manufacturer or provider of output services shall pay an amount equal to the CENVAT credit taken on the said capital goods reduced by the percentage points calculated on the straight line basis as specified below for each quarter of a year or a part thereof from the date of taking the credit , namely: 1. For computers and its peripherals,: a. For each quarter in first year@10% 2. For capital goods other than computer and its peripherals@ 2.5% for each quarter. Provided that if the amount so calculated is less than the amount equal the duty leviable on the transaction value, the amount shall be equal to the duty leviable on the transaction value. Moreover, if the capital goods are removed in the same year then he should take the balance 50% credit and then remove the capital goods under an invoice issued under Rule 11 after reversing ht credit as per provisions narrated above. But no interest is payable on the same.
hlo sir. suppose a factory owner selling goods to another. and the second party is exporting those goods through merchant exporter. so whether first party's transaction would be including in claiming Rs. 400 lakhs exemption limit as home clearance sunil mehla (Posted On: 06 May, 2013)

First of all, the small scale exemption under Notification number 8/2003 is available upto Rs. 150 Lakh if the aggregate value of clearances in last financial year is less than Rs 400 lakh. Your query is that whether the goods cleared to a person and he is exporting through merchant exporter will be counted in computing this limit of Rs. 400 Lakhs. The export sale is not counted towards the same. However, it is not direct export as well as export through merchant exporter. You have cleared to third party and this party is exporting through merchant exporter. Hence, as per our opinion, this will not be termed as exports and will be termed as home clearances. Hence, this will be counted in aggregate value to be computed in Rs. 400 Lakhs.
DEAR SIR, Regarding my earlier query ST-25/212 read with Notification 3/2013 GTA carrying agro produce and foodstuff is exempt from service tax. Earlier food grain was used. My query is foodstuff includes human or animal or both? Whether poultry feed and Roasted Gaur Korma, supplements are include in foodstuff? SATYA PARKASH GUPTA (Posted On: 06 May, 2013)

Prior to the notification no. 3/2013 service tax on GTA was exempt in respect transportation of fruits, vegetables, eggs, milk, food grains or pulses in a goods carriage but this was amended trough the Notification no. 3/2013, through this notification service tax on GTA was exempted in relation to the agricultural produce and foods stuff. Generally food stuff is any item that can be used or prepared for use as food. As per sec 65(b) "agricultural produce" means any produce of agriculture on which either no further processing is done or such processing is done as is usually done by a cultivator or producer which does not alter its essential characteristics but makes it marketable for primary market. Usually guar seed when passed through solvent extraction process turns to guar gum split and Churi korma. Thus it won’t be covered under exemption notification as it has been materially altered.
Sir, We are manufacturing co. & SSI unit having annual turnover Rs. 7.00 corer & paying excise duty near about 48 lakhs (centvat + PLA) Presently we are filing ER-I return. My query is whether we are liable to file ER-4/ER-5/Er-6?Pl advise KAILAS PATIL (Posted On: 05 May, 2013)

As per Notification No. 17/2006-Central Excise (NT), dated 01.08.2006, as amended, issued under Rule 12(2)(b) of the Central Excise Rules, 2002, inter alia, exempts assessee who paid duty of excise less than Rs. 1 crore in the preceding financial year, from filing the ER-4 return. Similarly, Notification No. 39/2004 Central Excise (NT), dated 25.11.2004, as amended, issued Rule 9A(4) of the CENVAT Credit Rules, 2004, exempts the specified class of manufacturers who paid duty of excise less than Rs. 1 crore in the preceding financial year, from filing ER-5 declaration and ER-6 return. Thus you need not to file ER-4 , ER-5 and ER-6 return.
If any service provider not crossing the limit i.e 10 lakhs, getting registred have to comply with the service tax laws & Procedure. Raghavender upadhyay (Posted On: 03 May, 2013)

If he is registered with the department then he has to file returns and comply with services tax rules and regulations. However, he can claim the exemption of Rs. 10 Lakh in his return.
sir, one of my client has purchased a manufacturing unit & the seller is charging excise duty on sale of machinery. is seller is eligible to charge excise duty? If yes, than can we take credit of it? ca deepak vaarmora (Posted On: 01 May, 2013)

The excise duty is to be charged on removal of goods from his factory. It cannot be charged when the complete unit is sold. On the contray, you can get unutilised credit lying in balance under Rule 10 of Cenvat credit Rules provided all the stock of raw material, under proces and finished goods is also transferred and complete liabilities of old unit is undertaken by the new unit.
Dear sir, Our unit is manufacturing we are purchasing aluminium scrap with duty paid, this same material sent to job work, and after job work material received with rod and this rod is issued for production, my query is how to show in excise book like, RG 23 part 1. Uttam wagdare (Posted On: 29 Apr, 2013)

When the materila is issued for job work then show the material issued in RG 23 A part I register also. It will also be entered in job work register. On receipt from job worker, it will be shown in job work register. If you are maintaining the RG 23 A part I register for rods also, then also show the receipt of the same in this register also.
Dear Sir. we are the manufacturer of small commercial vehicles and we are selling our vehicles to our authorized dealers. As a condition of sale the dealer is giving free warranty service to end customers and for which dealer is recovering cost of service along the with service tax from us(Manufacturer)  Can we avail cenvat credit on dealer bill  we have taken marine insurance policy which is covering all vehicles sold to dealers in transit. we are recovering the premium amount proportionately from the dealer through billing. can we take the service tax cenvat credit on insurance premium paid for marine policy.   manufacturer has warranty failed parts in their factory and again sending those warranty failed parts to original supplier for analysis purpose (Reason of failure). while sending those failed parts from our factory (Manufacturer) shall we need to pay excise duty on this. Please suggest on this. Regards RAMAPPA SOMAKKALAVAR RAMAPPA (Posted On: 29 Apr, 2013)

The number of questions have been raised in this query. We are replying in same order:- 1. The credit on free warranty bills of dealers can be taken as the definition of “input service” in Rule 2(l) of CCR,2004 clearly provides in exclusion clause the credit on repair and maintenance of vehicle will be available to manufacturer of vechile. 2. The same way the definition of input services allows the Cenvat credit of the credit of general insurance services availed for the vehicles can be taken by the manufacturer of motor vehicles. This is because the exclusion clause (BA) of the definition of input services does not apply on the manufacturers of motor vehicles and insurance companies. Therefore, they can take credit of the insurance and repairs and maintenance services pertaining to motor vehicles manufactured by them. 3. So far as the sending of warranty failed parts for testing purpose is concerned, manufacturer is not required to clear the same on payment of duty. When the same are received back in factory from dealer, he must not have taken the credit on the same as per Rule 16. These goods normally cannot be repaired, remanufactured then Rule 16 does not apply and the credit was not taken on the same. But if the credit is taken then he has to clear the same on payment of duty.
New office build-up in the factory premises.In this case is company is liable to pay service tax under works contract ( by considering partial reverse charge)? If yes then on which value as company paid him (service provider) step by step as work will progress? Yogesh Pawar (Posted On: 28 Apr, 2013)

If the construction of building is kind of original works i.e. new construction, erection, commissioning, installation then abatement of 60% of total amount is allowed and service tax is levied on the balance 40% amount. Hence, the service tax payable under the same is 4.944%. The reverse charge is also applicable in the work contract service. If the person providing the service is individual, partnership, HUF etc and service recipient is company ( as told by you in query) then 50% of the service tax is payable by service provider and rest 50% by service receiver. Therefore you are liable to charge 50% service tax in your bill and deposit the same. But if the service falls under finishing services then the rate of abatement is 40% and service tax will be payable on 60% of value. Hence the tax will be 7.42. Out of above, 3.71% will be payable by you under reverse charge mechanism and service provider will pay 3.71%.
Sir, my query is regarding amended rule 3(5)(b) w.e.f. 01.03.11. As per rule before amendment i.e. up to 28.02.11, if value of any input on which CENVAT Credit has been taken is written off fully or where any provision to write off fully made in the books of account, then the manufacturer was require to pay an amount equivalent to the CENVAT credit taken in respect of the said inputs. (i.e. cenvat reversal require when 100% written off) But as per amended rule w.e.f. 01.03.11, if value of any input on which CENVAT Credit has been taken is written off fully or partially or any provision made fully or partially then the manufacturer is require to pay an amount equivalent to the CENVAT credit taken in respect of the said inputs. (i.e. cenvat reversal require even partial write off of input). We have followed the amended rule and reverse the cenvat on input on which partial absolute or non-moving provision is made after 01.03.11. There was partial provision existed in our books on absolute stock as on 28.02.11 (before rule changed). In Excise audit, dept took stand that the amended rule 3(5)(b) w.e.f. 01.03.11 is also applicable to the partial provisions made earlier. They have asked to reverse the cenvat credit and pay an amount to Govt and take re-credit of the same in subsequent month. In our reply we have denied to reverse the cenvat on the provision made earlier 01.03.11 as rule is not having retrospective effect. Now we are waiting for reply from dept. Sir, can u guide whether the department’s stand is correct as per rule. Sachin Pawar (Posted On: 28 Apr, 2013)

Your stands seems to be correct. For detailed opinion on the subject, we will require the detailed documents and show cause notice.
Dear Sir, our firm is a contractor of govt. local body, employee engaged in this firm is 4 or 5. we have no PF & ESI no. as we have less than 20 employee but problem is that with out PF no. we cann't file tender in that local body. so what to do in this situation? mita mukherjee (Posted On: 27 Apr, 2013)

We are not dealing in PF and ESI act and hence will not be able to reply your query.
Dear Sir, One of my client is supplying trucks to a main contractor who has taken Road construction work for shifting of sand from one place to another he is issuing invoices as per the agreement on monthly basis Service receiver is a pvt. company and service provider is an Individual whether the service amounts to GTA service or whether the above service is taxable under supply of tangible goods for use. If it falls under GTA service then service provider is not liable to tax as the Tax is payable under RCM by the service receiver if it falls under supply of tangible goods for use then the service provider is liable for tax can you please clarify. nagendra (Posted On: 26 Apr, 2013)

Supply of dumps trucks without the transfer of ownership is covered under the scope of supply of tangible goods service whereas “goods transport agency” means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called Section 65 (50b)of the Finance Act, 1994. Here it seems that your client has transferred the right to use of truck to the pvt. Com and he is not operating transport of goods service. Therefore, in our opinion, it is covered under the supply of tangible goods service and service tax @12.36% must be charged by the service provider.
Our company is doing process [which is not amount to manufacture or production] on the material send by one excise exempt unit -[this unit is exempt on place basis]. After processes, processes material along with scrap is sent back to the excise exempt unit. For the processes, our company is charging job work charges and on that amount paying service tax. My question is: 1. Whether service tax is leviable on such job work charges in view of the fact that our company's customer is an excise exempt unit on the basis of its location?? 2. If our company is liable to pay service tax then can our company take cenvat credit of service tax on the labor charges hired for the processes [service tax has been paid under reverse charge]. atul jain (Posted On: 26 Apr, 2013)

For job work, there are two type of exemption from service tax. Firstly, if the process amounts to manufacture and secondly, the supplier further uses the goods and pays Central excise duty on his final product. But both the conditions are not fulfilled in this case. Hence the service tax is payable. Moreover, there is no area based exemption for service tax. Also,if the input servcies are used in providing the output services then the credit can be taken on the same.
ABOUT SAD REFUND condition is that the burden of 4% AD has not been passed on by the importer to the buyer and that the requirement to rule out unjust enrichment is fulfilled. Sir how it is possible because after import a importer sale this goods and charge sale tax from customer tarun (Posted On: 24 Apr, 2013)

The SAD is different from the sales tax. The sales tax is to be charged and its incidence is to be passed on to the buyer. The condition is that incidence of 4% SAD paid at the time of import should not be passed on to the buyer. This means that it should not be part of price of goods sold.
Dear Sir, Applicability of service tax - Renting of Immovable Property Services performed before 01/06/2007 when it was exempted from service tax, I need your valuable opinion regarding the applicability of service tax in the following situation. Situation -1: Billing to client and consideration received after 01/06/2007. Situation -2: Billing of the same to client done before 01/06/2007, whereas the consideration against such service received after 01/06/2007 Regards Rakesh Rakesh Kumar Singh (Posted On: 24 Apr, 2013)

During that period, the point of taxation was not applicable. The service tax was payable on receipt basis. But there was clearcut verdict of Gujarat High Court on this issue that the service is neither limked with billing or receipt of service but it is linked with provision of serivce.
Is filing of ST-3 compulsory for Transporter. Yash (Posted On: 23 Apr, 2013)

If he is registered with the department then return is to be filed. But if he providing services to seven categories of person only and there is no tax liabilty on him then there is no need to get registered with the department and file returns.
In case the vendor has wrongly billed full service tax in his invoice but his service is covered under the Partial Reverse Charge Mechanism and we had paid the full tax amount to him, so still our liablity stands to pay servicetax under RCM as we are a company. Kshitij khare (Posted On: 23 Apr, 2013)

The ultimate liability to pay tax is on you and you cannot shift this statutory liabiity by contractural obligation. We have seen that the department has issued demands in such cases. We can plead that the service tax has been paid to the Government and there cannot be double taxation on same transaction.
Dear sir, we are holding central excise certificate on readymade garments manufacturing on current budget the tax rate is zero rate. so we have to surrender the certificate and continue the business. is it possible to run the business. pls suggest RAVICHANDAR (Posted On: 22 Apr, 2013)

The query is not much clear. You can surrender and continue the business.
Respected sir Whether CT-1 form ( for a merchant exporter) can be used even after expiry of a period of one year when validity period of one year is specifically mentioned in CT-1. What is the solution if CT-1 is used beyond one year period with regards N.k.Joshi nkjoshi (Posted On: 21 Apr, 2013)

It can be used during the validity period. But when it is used beyond the period and proof of export has also been filed, then we can plead that the export has taken place, hence the demand should not be raised on this procedural lapse.
when & which transactions are debited / credited in B 17 Bonds by EOU units ANIL TIWARI (Posted On: 19 Apr, 2013)

B-17 bond is executed for these transactions:- 1. 25% duty forgone on capital goods whether imported or indigenous. 2. Custom or Central excise duty forgone on inputs; 3. Duty for the export of goods. The transactions relating to same are debited/credited in B-17 bond.
we are a professional member of Indian Energy Exchange Ltd .We provide the service to our clients by procuring power . In this connection we had paid admission fee and membership fee to Indian Engery Exchange on which service tax is collected by them. We charge to our clients Service charges on which Service Tax is collected. Now our question is whether we can claim the Service TAx paid on Admission and Membership Fee as input and set of the same against the service tax payable by us . Kindly Clarify radha sri krishna rao (Posted On: 18 Apr, 2013)

As per definition of input service given under Rule 2(l) of Cenvat Credit Rules, 2004, “input service means service used by service provider for providing output service”. Therefore if such service of membership is used for providing your output service then credit will be allowed.
i ve rented out commercial premise. i am now collecting service tax on it. can i take set off for srvice tax on maintenance bill(for that commercial premise which is rented out), my own mediclaim service tax,also whether service tax is to paid on gross rent of 20000 or after deducting municipal tax of 2000 and then be paid on 13000, kindly guide with ur experience rishi (Posted On: 18 Apr, 2013)

1. As per Rule 2(l) of Cenvat credit Rules, 2004 you can take the credit of those services which are used for providing output service of “Renting of Immovable Property”. The credit of maintenance charges will be allowed but if maintenance is in nature of work contract service, then credit will not be allowed as it is specifically excluded from the definition given under Rule 2(l). Further credit of mediclaim will not be allowed as it is personal nature expenditure. 2. Service tax will be levied after deduction of municipal tax paid. Further it is clarified here that renting of immovable property for residential purpose is exempt under negative list, so if you have rented the property for residential purpose, then you are not required to pay service tax.
Respected Sir, A foreigner stay in the hotel and paid the bill amount in Indian currency. whether that amount will be considered as foreign earning for redemption to EPCG license? NAVIN JAIN (Posted On: 17 Apr, 2013)

No, it will not be considered as payment in foreign currency.
Respected Sir, ABC P LTD got registered with excise department from 01.04.2012, however company is liable to pay excise duty from 01.04.2011, now company has paid excise duty from 01.04.11 to 31.03.2012. My question is can company file the return for the period 01.04.2012 to 31.03.2012 or what type of documents shall be submitted with department? Whether company is liable to pay any penalty other than interest? NAVIN JAIN (Posted On: 17 Apr, 2013)

You have to file the returns for the earlier period along with interest. But the penalty need not to be deposited. If it is levied by adjudciaiton officer after the show cause notice then the same is payable.
Sir, We installed in factory one capital goods last F.Y. thats time we have utilised cenvate 50% But Second year we not taken a cenvat credit. My Query is know possible on take the credit? bhairav kumar (Posted On: 17 Apr, 2013)

Yes, you can take now the remaining Cenvat credit (50%) of that capital goods.
dear sir, if my service provided in preceeding f.y is more than 10 lakh , and i m cover under mega exemption notification ,is there neccecity to get registration. ca vasib ansari (Posted On: 15 Apr, 2013)

No, you are not required to get the registration as the service itself is exempt. Registration is required to that person who is liable to pay service tax or any provider of taxable service whose aggregate value of taxable service in a financial year exceeds 9 lakh rupees.
what is last date of filing annexure 19 under excise act and what is the last date of submiting hard copy of er-1 in excise department???? vinay gautam (Posted On: 15 Apr, 2013)

The last date of filing of return in Annexure 19 is not prescribed but normally it is to be filed before next month. Secondly, there is no need to file manual ER-1 return in the department.
Dear Sir, Please suggest whether Service Tax to be deposited?? " The company has given a quotation of 100+12.36 to customer. Later the company found that the same was export of service and no liab. arise on the same, hence while billing they billed @ 112.36 for service only as no S.T. being shown any where on the invoice." Rahul (Posted On: 15 Apr, 2013)

If anything is recovered in the name of service tax then it is to be deposited to the department. It is clear from the agreement that you have recovered service tax though not specifically shown in inovice then the service tax is to be paid to the dpeartment.
Dear Sir, We have availed services from Bureau of certification for ISO 9000-2008. The reasons to become certified in ISO 9000 are that we are able to satisfy customer requirements, to be able to do business in Europe, to be able to advertise your certification, and to improve your company's operations. Whether we can avail cenvat credit on such certification charged by service provider Regards DM Dayal (Posted On: 15 Apr, 2013)

In our opinion credit of certification service will be allowed. As per Rule 2(l) Input service means any service used by manufacturer whether directly or indirectly in the manufacture of final product and clearance of final product upto the place of removal or services used by service provider for providing output service. Further this definition specifically includes services of Credit Rating, advertisement, business exhibition, share registry etc. The nature of certification service is also same as credit rating therefore in our opinion credit will be allowed. However department may raise the point that Certification service is not specifically mentioned in the said definition.
Our company has issued work order to a firm for arranging & acquisition of land after all necessary approvals from various governemnt bodies and also clearing/cleaning of the land for easy access/ transfer of title etc. For this the service provider shall give us the bill for professional service fees. This service shall come under which category from service provider point of view and also whether we as a company shall be covered under reverse charge mechanism. At present the service provider is regd under : erection/commissioning/intallation , Consulting enginnering service,Technical inspection and certification agency.Please clarify NILESH BHANDARI (Posted On: 13 Apr, 2013)

The service will be covered under “Real Estate Agent” service. Further you are not liable under reverse charge mechanism for the purpose of this because reverse charge mechanism is not applicable on this service.
Dear Sir, our firm is providing AC service we are providing it by AMC which is comprehensive[ with Material] then service tax should be on 70% amount.when we going to raise bill to our parental company.but whether we are liable to pay vat when we raise bill to our parental company?we are also trading company. Payal Thakkar (Posted On: 13 Apr, 2013)

We do not deal in VAT laws. However in our opinion VAT will be levied on material value because the State VAT laws are not linked with Central law of Service tax and it shall be levied on sale whether service tax is leviable or not. Further there is no effect of the fact that the buyer is a parent company as seller and buyer are two separate entities.
SIR WE ARE DEALING IN EXPORT OF TIMBER SO I WANT TO KNOW CAN I AVAIL ZERO CUSTOM DUTY UNDER EPCG SCHEME tarun (Posted On: 12 Apr, 2013)

The zero percent EPCG is not applicable to Chapter 44 (except plywood and allied product). Hnece we are of view that it is not applciable to instant case.
A section 25 Company is registered under Section 12AA of the Income Tax Act, 1961 and its main objects are : To collect information upon all topics of interest to members and act as press organization. Any fees received from it members will attract service tax?? Meeta (Posted On: 12 Apr, 2013)

In our opinion service tax will be levied on fees received from members as the service is neither covered under Negative List or Mega exemption Notification 25/2012 as amended. However the Sl. No. 28 of mega exemption notification exempts “services by a non profit entity to its members by way of reimbursement of charges or share of contribution for the provision of carrying out any activity which is exempt” but this exemption will not available in the instant case because the output service of press organization is not an exempted service.
Sir, In respect of amendments notified through Notn. No. 3/2013, whether exemption is available since the original Mega Exemption Circular, i.e., from 01-07-2012 or only prospective from 01-04-2013. Eg. Freight on Tea Kannan (Posted On: 12 Apr, 2013)

The notificaiton is applicable from the date of its publication. Hence, Notification 3/2013 will be effective from its date only.
We are a Firm and manufacture vermicelli. We pay freight to lorries for wheat and maida. We hope wheat was exempted as food grains / agri produce. But whether maida, a derivative of wheat, is also exempted from inception or only wef from 01-04-2013 - vide Notn. No. 3/2013 Kannan (Posted On: 12 Apr, 2013)

In our opinion transportation of Maida will also be exempt under Sl. 21(d) of exemption notification i.e. transportation in goods carriage of foodstuff including flours, tea, coffee, juggery, sugar, milk products, salt etc because maida is also a type of foodstuff similar to flour.
Sir ji.. In respect of Renting or properties to a Company by is Director is now taxable under RCM at the hands of Company; Can u pl. advise the Director can surrender his RC since the Director has no other taxable Service income other than renting of immovable properties What is the formalities.. in such cases..? visu iyer (Posted On: 12 Apr, 2013)

You can surrender your registration online and submit the print out along with original registration certificate to the department.
Sir, our unit is manufacturing and we are filling excise return ER-1 on monthly basis, on this return I have taken credit of Service tax of GTA and Input services, now I am am filling service tax return st-3 for 2nd qty (july-12 to sep-12), than should I credit of input service tax and gta in service tax return ST-3. Uttam (Posted On: 11 Apr, 2013)

As per our opinion, it is to be shown in ER-1 return only as you are taking credit as a manufacturer and not as service provider.
Sir. we had taken service tax registration under manpower supply and we are depositing service tax under this code but in actual, we are providing services under work contract we had deposited 2nd qtr and 3rd qtr of service tax under manpower supply. On february-13 we have taken registration under work contract and deposit service tax under work contract code for 4th Qtr. what are adjustement for 2nd qtr and 3rd qtr. and is there any penalty provision for late registration Pls suggest on above matter regards Dinesh dinesh negi (Posted On: 09 Apr, 2013)

You had registered under service tax but only the mistake was that the category of classification is wrong i.e. Manpower supply service instead of Work contract service. After introduction of negative list concept, classification is no more important and question of classification is arisen only in special cases i.e. reverse charge, abatement, exemption, valuation etc. and in general cases classification is not more important as service tax rate and valuation is same. Now in the instant case if you have correctly determine the service tax as per provisions applicable to “Work contract service” and only mistake was that you have deposited in wrong category then there is no problem. However, the classification is re-introduced in service tax. Hence, we should deposit the service tax under correct heading in future. Further the penalty should not be imposed for mistakes limited to wrong classification. But if service tax itself is wrongly determined by not following valuation rules for work contract service then interest and penal provisions will apply.
Dear sir, whether reverse charge mechanism on services provided by vastu consultant is applicable or not .If yes please advice me the apportionment of S.tax payable by receiver and provider .Sir answer as soon as possible .. (Posted On: 08 Apr, 2013)

No RCM for such services.
Dear sir, whether reverse charge mechanism on services provided by vastu consultant is applicable or not .If yes please advice me the apportionment of S.tax payable by receiver and provider . Ankur K. Prince (Posted On: 08 Apr, 2013)

Already answered, No RCM for such services.
Dear Sir, We are doing Supply of Man Power Business & we pay service tax on this services. I have question if we are paid service tax on Labour/employee group mediclaim Policy & Group Personal Accident Policy then we are eligible to taken credit of service tax paid on this policy. Pravin Divate (Posted On: 05 Apr, 2013)

The definition of Input service specifically excludes services of life insurance, health insurance etc. primarily for personal use of employees. Therefore service tax on mediclaim will not be allowed. However, in our opinion credit of service tax on Group Personal Accident Policy may be allowed as it is not specifically mentioned in the exclusion clause. But department will raise the objection that the services referred in exclusion clause is only examples and similar services will also be included for the purpose of this exclusion.
dear sir, plz clarify on the export of goods issue" (shipping bill date is 26.03.13 & let export date 28.03.13) please tell export made under this shipping bill will be considered in export turnoner of year 2012-13 or 2013-14. also let export date can be considered as date of transfer of ownership or not. PARVEEN KAUSHAL (Posted On: 05 Apr, 2013)

Export is considered on the basis of Let Export Date and in the instant case, export will be considered in 2012-13. Further the transfer of ownership is not related to the Let export and Let export date may differ from date of transfer of ownership based on facts of each case.
Dear sir, One of our client is providing foreign language coaching and translation work service. After getting translation work from Non residents, they sublet/contract work to Non resident.(that means they are working as brokering) My query is whether the service provided outside India is export of service? Will the payment made to the sub letting person also attracts Service tax? Raghavender Upadhyay (Posted On: 04 Apr, 2013)

:- For the determination of leviability of service tax, it is to be decided whether the service in instant case is treated as Intermediary service as mention in Rule 9(c) of place of provision rules or not. Intermediary is a person who arranges a provision or service between two or parties but does not include a person who provides main services on his account. In the instant case assessee is not treated as intermediary as he is providing services on his account i.e. there is a principal to principal relationship and also consideration is not represented such as commission etc. As he is not treated as intermediary therefore place of provision will be determined as per Rule 3 and as per this rule place of provision shall be the location of service receiver. As place of provision is non-taxable territory therefore if in the instant case consideration is received in the Convertible foreign currency then it is treated as export of service in terms of Rule 6A of Service tax Rules and service tax will not be apply. Further input service received from non-resident will be taxable and liability will be on service received as it will be treated as import of service. As you have clearly not mentioned the facts therefore if the facts represent that it is an intermediary service then service tax will be levied because in such case place of provision will be location of service provider i.e. taxable territory and therefore it will not satisfy the conditions of Rule 6A of Service tax Rules, 1994.
If ABC ltd not paid service tax under reverse charge within 6 month of the date of invoice then service tax liability will be applicable from the date of invoice. Suppose abc ltd has paid service tax under reverse charge after 7 month with interest but not paid to value of input service to vendor then ABC ltd is eligible to take cenvat credit of such service tax paid under reverse charge. Query Related to service tax under reverse charge: (Posted On: 04 Apr, 2013)

The first proviso to Rule 4(7) of Cenvat credit Rules clearly says that the credit will be allowed only after payment.
Sir, Can a Chartered Accountant take CENVAT Credit of Excise duty paid on Computer/Laptop purchased in the Firm Name Vipul Kumar (Posted On: 03 Apr, 2013)

As all the services of CA are taxable, hence he can take credit on captial goods as per definition given under Rule 2(a) of Cenvat credit Rules.
Dear Sir, Whether Service Tax paid on Purchase of flat can be claimed while paying the Service Tax on professional Fees. Regards, Jinu Jinu Michael (Posted On: 03 Apr, 2013)

There is specific exclusion in defintion of input service given under Rule 2(l) of CCR, 2004 about works contract and construction service relating to building or civil structure.
sir, i am service receiver and paying reverse mechanizam on billing amount of 75 %, i used credit what ever i pay tax , sir now in st3 [july to sept 2013] where i show this credit utlized. asmita (Posted On: 03 Apr, 2013)

Firstly Service receiver can’t be utilize the Cenvat credit for payment of service tax under Reverse charge mechanism in term of Explanation to Rule 3(4). In case of credit utilized for output services, it is to be shown in Column D2 (service tax), E2 (Education Cess), F2 (SHE Cess) of part D, E and F respectively.
My client is into fabrication work. My query is that for service tax on GTA and labour it is registered at office address and it is taking setoff of service tax paid against its excise liability for which registration is at factory premises. Whether such setoff can be taken if premises are different. If no , what happens about setoff already taken . seema raisoni (Posted On: 02 Apr, 2013)

If both the registration are at separate premises then credit cannot be taken. If these are manufactured as well as servcie is provided from same premises then it is advisable to take registration from same premises.
dear sir what is the point of taxation inrespect of "construction of residential complex service" whether it is the date of receipt of advances or the date of registration of flat. please clarify. anil kumar m (Posted On: 30 Mar, 2013)

The point of taxation is advacne received, invoice raised or service provided whichever is earlier. If the invoice is raised within 30 days of service provided then the service tax will be payable on invocie basis. But if invoice is not raised within that period then it will be date of provision of service. Furhter, the point of taxation for the continuous service will be decided on the basis of terms and conditions of agreement.
Sir, we are build up Shiv Murti 350 fit and making parties charge us service tax, vat, CST etc. This is developing purely for general public therefore above taxes are exempted or not. arvind jain (Posted On: 29 Mar, 2013)

No, there is no any exemption in service tax in this regard. This type of service is not specified either in negative list or under mega exemption notification. However service tax will not be levied if the activity amounts to manufacture.
Respected Sir, We are manufacturer of Iron and Steel covered under Excise .After introducing of Reverse charge mechanism (RCM) we are facing some problem like. 1 we have labor contractors for bundling & bundling of Bars they don’t have registration in Service tax (bcoz amount is less than 10 lac).so, RCM should attract on them or not? Under head supply of Man power) 2. We have made construction in the plant, labor and material supply by the civil contractor should it cover under the works contract service in under RCM or not? We have suggested by range Superintendent that there is no clarification about it. So please take precaution about in these types of transaction .Dept Can Arise liability in near future. So sir Please Give your Suggestion Regarding in these transaction CA Rajat Jain 9166132638 Rajat jain (Posted On: 29 Mar, 2013)

If the control and supervision in case of manpower supply is in hands of manufacturer then the service tax under RCM is applicable. Moreover, the provider should individual, HUF, partnership and recipient should be company. In case of construction service, if the material and labour are used by contractor then it will fall under works contract. Hence the RCM is applicable provided all other conditions are satisfied.
Sir This query is reg ser tax applicability. Tractor driving by road by a contractor. We pay per tractor Rs.500/-. Driver not working under our co. Contractor gives bill for 500/-. Any ser tax liability?? D.S.MURTHY (Posted On: 29 Mar, 2013)

Under GTA service tax is on agency who issues consignment notes. As in such cases, the transporter himself is providing services and no consignment notes is issued, hence no service tax is applicable.
Sir, we are a C. Exc. regd. factory registered as a service receiver and have been filing ST3. Now in the new ST-3 meant for July - Sept.2012, in the drop down list for constitution, there is no word as PARTNERSHIP. instead there is one "Limited Liability Partnership" and another "A FIRM" we are partnership as per the deed; which one is now applicable for us to select out of the 2 new constitutions mentined in the format ; pls advise us Sir, (Posted On: 29 Mar, 2013)

There is lot of problems in ST-3 return for July to September 2012. The last date of filing of return is extedned to April 30. Hope that the solution will come to all problems.
Dear Sir If any transportation company charge service tax on their bill then company (Service Receiver) have to pay service tax to transporation company or to Govt. gaurav (Posted On: 28 Mar, 2013)

In case transportation of goods by road service, if person liable pay is company then 100% liability of service tax is on company and not on transporter. Therefore company has to pay service tax directly to government and not to transporter.
Sir, Kindly clarify the following 1. whether service tax is payable under RC mechanism on sitting fees payable to whole time directors. 2.whether non employee director has to compulsorily issue invoice for sitting fees payable to him 3.whether service tax paid by the company under RC mechanism for sitting fees paid to non employee director could be availed as input credit. Regards, Nagarajan V nagarajan v (Posted On: 25 Mar, 2013)

Whole time directors are treated as employee of company and as per definition of service given under clause 44 of 65B Service not include “provision of service by employee to employer in course of or in relation to his employment” Further as Department Letter No. 3/1/90 CL-V, dated 18-07-1990 of MCA makes it very clear that sitting fee may be paid only to a director who is not whole time director or a managing director. i.e. sitting fees is to be paid to a non-executive director only. This letter makes it very clear that if sitting fees is paid to managing director or whole time director then it will be considered only as payment of remuneration to the directors. As the whole time directors is treated as employee of company and sitting fees paid to them is also a part of his remuneration therefore in our opinion service tax will not be levied on it. 2. In our opinion, non-employee directors are not required to raise the invoice because these services are covered under reverse charge mechanism. In case of RCM for directors, the 100% liability is on company. The input credit of these services is allowed to company on the basis of challan depositing service tax. 3. Yes credit will be allowed in respect of service tax paid on services of director as it covers under the definition of input service given under Rule 2(l) of Cenvat Credit Rules.
Sir, is it mandetory to make aggrement / contract on stamp paper under works contract service with service provider? Yogesh Pawar (Posted On: 24 Mar, 2013)

No, In service tax law there is no such type of requirement that agreement of work contract should be on stamp paper.
Dear Sir, Kindly advise the date of deposition for March'13 under reverse charge mechanism especially for service receiver component i.e. 75% security & manpower supply. Regards ATUL GAUR (Posted On: 24 Mar, 2013)

Service tax deposition date for March month (whether under reverse charge or otherwise) is 31st March. Service tax is to be deposited on the basis of Point of taxation i.e. if Point of taxation is in March then it shall be paid upto 31st march and if POT is in any other month then service tax is to be deposited upto 5th day of subsequent month of POT. In case of service receiver liable under reverse charge mechanism, point of taxation is the “date of payment”, subject to condition that payment of such input service is made within 6 month. But if payment is not made within 6 month then Point of taxation shall be the date of invoice/date of service provided.
pl guide me service tax exemption limit of i0 lac can avail if the company having excise turnover of rs 2 crore and 8lac in service in preceding year SOMNATH GHOSH (Posted On: 23 Mar, 2013)

Yes you can avail the threshold exemption of service tax. For claiming exemption under service tax, the turnover of taxable services of the previous is to be considered and not the excise turnover.
Dear Sir, If a broker ( registered service provider )purchases a property on which he pays service tax at the rate of 3.09%.Can he claim credit of the service tax paid on the property purchased against the service tax payable on the brokerage service provided by him? Please reply at your earliest convenience l (Posted On: 22 Mar, 2013)

As per Rule 2(l) of Cenvat Credit Rules 2004, input service means any service used by provider of output service for providing output service. i.e. credit will be allowed only on those services which is used for providing output service of broking. But credit of service tax paid on purchase of property will not be allowed even if it is used for providing output service because the definition of input service given under rule 2(l) specially excludes services “service portion in the execution of a works contract and construction services including service listed under clause (b) of section 66E of the Finance Act (hereinafter referred as specified services) in so far as they are used for construction or execution of works contract of a building or a civil structure or a part thereof” therefore credit will not be allowed.
Dear Sir, Whether Service Tax on GTA services is exempted in hands of consignor/consignee for carriage of tea as per recent budget 2013-14 Subhendu S Ghosh (Posted On: 15 Mar, 2013)

Notification no. 03/2013-ST has amended the entry no.21 of notification no.25/2012-ST. Through this amendment service tax on GTA has been exempted on the carriage of tea. Thus no service tax will be payable for the carriage of tea.
sir, one person(not company) done installation of ac work in my company and issued bill under heading "supply of labour for installation of ac" wether it attracks service tax under reverse charge mechanism under work contract pankaj kumar (Posted On: 15 Mar, 2013)

As you are saying that only labour work is done therefore it is not a work contract service (material not supplied) therefore reverse charge will not apply. Further it is also not “manpower supply Service” because it is a contract for work and not manpower supply(i.e. work is done independently and not in supervision of service receiver).
Dear Sir, CCTV CAMERA ARE CAPITALIZED GOODS FOR A/C PURPOSE. somnath (Posted On: 15 Mar, 2013)

We deal in service tax and excise matters only. Please ask queries related to them.
Dear Sir, when a commodity is subject to assessment on MRP basis as per sec 4A of CE Act, Is there any relevance between assessable value (MRP-abatement) and billed value ? Whether CE dept will rise question in case assessable value is lesser than billed value?. Kindly clarify. Thanking you. M.Rajendran (Posted On: 14 Mar, 2013)

If a commodity is covered under Section 4A of Central Excise Act, 1944, then MRP valuation will be applicable. Under MRP valuation, assessable value is determined by subtracting a specified percentage of Abatement irrespective of billed amount. Therefore department can’t raise the question. However, if MRP is incorrectly declared then penalty can be imposed by Central excise department [section 4A (4) (a) of Central Excise Act] and in such case department may consider, billed amount also.
we have been registered with central excise.Now excise duty has been withdrawn on readymade garments. we have balance of duty in hand. also have finished goods in hand. On adjusting the duty credit on finished goods still duty is recoverable. How to surrender the license along with claiming the refund. How to file the statement regarding reversal of duty include in finished goods? Thanks in advance sambhav Jain (Posted On: 12 Mar, 2013)

As per Rule 11(3) (ii) of Cenvat Credit Rules, 2004, the manufacturer of finished goods is required to pay an amount equal to Cenvat credit availed by him on inputs which is in stock or in process of final goods or is contained in finished goods if the such finished goods have been exempted absolutely under section 5A of the Act. Also, the exemption to garment industry is with the condition that no credit should be taken on input and input services. Hence, if we want to avail this exemption then the credit is to be reversed. Further the balance of Cenvat credit after deducting this reversal amount (amount of credit availed on inputs in stock, in WIP or contained in finished goods) will also be lapse. But if there is shortfall then it is to be paid in cash. Thus, in your case also manufacturer of readymade garments will have to reverse the balance of Cenvat credit of inputs of the said exempted finished goods as credit is available. For surrender of the Registration certificate, a declaration in prescribed format should be submitted to Superintendent.
Dear Sir, I have a quarry about 194C. If we are using contract labour and contractor gives two bills one for labour amount and second for service charge then on which amount we deduct TDS i.e. on whole amount/ on Service charge amount or on labour charges amount. please solve this query as soon as possible Saurabh Khandelwal (Posted On: 12 Mar, 2013)

We do not deal in Income Tax. Ask Queries related to Excise, Service Tax and Customs.
IN THE REPLYING OF QUERIES OF 1 PERSON, YOU ANSWERED :- QUES :-AMC given for Machine where sale of Property does not include, then, whether it is covered under works Contract OR Not? ANS :- For work contract service there should transfer of property in goods involved in execution of such contracts. Since you are saying there is not transfer of property in goods involved so the service will not be work contract service. SO, PLSE SUGGEST ME UNDER WHICH CATEGORY , IT IS FALL. THANKS DARPAN AGGARWAL (Posted On: 11 Mar, 2013)

As it is not covered under work contract service, therefore, for payment purpose, it will be covered under “Maintenance and Repairs Service” and accounting code is “00440245”.
Dear Sir, Pls. let me know the CVD on 100% Cotton readymade branded garment of children and other readymade garments in chapter 61-62 Brijesh Sharma (Posted On: 11 Mar, 2013)

As per Notification no. No. 11/2013-Central Excise the ready garment has been exempted from the payment of excise duty. Therefore no duty is payable on them.
Sir one of my client importing gift articles and remove the cover and sell the gift articles under their packing cover to the gift shop ( retailer). I just want to know whether packing and repacking is liable to excise under the mrp based valuation Thanks in advance Arun kumar (Posted On: 10 Mar, 2013)

You have not clarified that what type of products are imported i.e. product name or tariff head of product. Therefore we can’t say that whether it is liable to excise or not. If the article is classified under Third Schedule of Central Excise Tariff Act then packing or repacking will be amount to manufacture and duty will be payable under MRP based valuation.
How do we differentiate goods transport operator and goods transport agency? Seeing the current definition of GTA it seems that even goods transport operators are liable for service tax? Sweta Kalantri (Posted On: 08 Mar, 2013)

In case of Transport of Goods by road, service tax will be levied only if Service provider is either Goods Transport Agency or a Courier Agency. Goods Transport Agency means, “person who provides services in relation to transport of goods by road and issues consignment note, by whatever name called”. Therefore service tax is levied only when transporter issues consignment note or any other document by whatever name called otherwise it is exempt. So whether if a transporter issues consignment note (whether it is called as goods transporter operator or not), service tax will be levied.
Our private limited company has let out one residential flat. We have not charged any service tax as the this is residential flat. However, society is charging us service tax on maintenance. My query is whether I can get credit for this service tax against my service tax raised through consultation fees. We are not using residential flat as such Rajesh Shah (Posted On: 08 Mar, 2013)

Credit of Service tax paid on Maintance Service of residential flat will not be allowed. As per Rule 6 of Cenvat Credit Rules, 2004 credit of input services used for providing exempted service will not be allowed. As letting of residential flat is exempted service and maintenance service is exclusively used for providing this service therefore credit will not be allowed.
One partnership firm having agreemnet with an Individual for suppyl of Labour but contract is these labour shall work on Piece rate basis not on basis of their slary.At month end their remuneration is paid on basis of production of pieces. Industru is textile processing and these labour works at Factory of firm. My question is Is it manpower supply agreement or Works contract agreement? How much service tax is payable? Is reverse charge is applicable?. S.P.Gupta (Posted On: 08 Mar, 2013)

Firstly it is not work contract service. Whether it is covered under manpower supply service or not, reverse charge will not apply (as service recipient is a firm and not a body corporate). Further in our opinion prima facie the service in instant case is not treated as manpower supply service as consideration is represented on the basis of work and not on the basis of labour supplied and it shows that control & supervision of manpower is not with service receiver. However whether the service is manpower supply service or not is ultimately depend upon the terms and conditions of the agreement. In our opinion, the service is not covered under manpower supply service and therefore it is a Pure Labour Contract. As you are saying labours work at factory for textile processing and as per sl. No. 30(a) of Mega Exemption Notification 25, “any intermediate process relating to textile processing is exempt from service tax” therefore service tax will not be levied.
sir,we have manu. unit and registered excise unit exporting goods in nepal and domestic market availing excise exemption of 1.5 crore under ssi.now our turnover increased from 1.5 crore ie 1.25 crore in domestic market and 60lackh in nepal market.excise dept issue us a notice to pay excise because we have accross limit of 1.5 crore in total turnover(nepal+india).we are exporting goods under bond ut1 and are1.we are receiving payment in inr. so do we have to pay excise duty or we will be exempted from paying the duty? abhinav aggarwall (Posted On: 07 Mar, 2013)

No, excise will not be levied. The exemption of 1.5 cores is available for home clearance and aggregate value of 1.5 crores does not includes export clearance. Therefore you are not required to excise on home clearance. Now the goods exported to Nepal in Indian Rupee is also counted as export.
Respected Sir, I am newly passed out CA and require your valuable advice. One of my clients has raised a query on service tax which is as follows: - My client is in the business of Road Construction, Repair and Maintenance and is a Pvt. Ltd company. They are in the receipt of services for the maintenance of the road and as per the Reverse Charge Mechanism the service tax liability in respect of some services is to be discharged by the service recipient w.e.f 1st July, 2012. My client business was made exempt from the service tax by including them in the List of Exemptions under Mega Notification no 25/2012-ST dated 20-06-2012 which is as follows:- "Services provided by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of a road, bridge tunnel, or terminal for road transportation for use by general public is exempt from service tax" They therefore being an exempt entity from service tax, whether they have to pay service tax under reverse charge Mechanism as service recipient or they will be exempt. Your professional guidance in this will help me a lot. Request you to also provide the reference for the above. Regards, Jayant Nahata jayant nahata (Posted On: 07 Mar, 2013)

The exemption is available in respect of service not to person providing service. The liability under reverse is independent from output service and therefore he will be liable under reverse charge, if applicable.
dear sir ,construction of bridges for government is exempt for main contractor.further if a sub contractor is providing work contract service to such contractor he is also exempt from service tax.please clarify that whether main contractor will deposit service tax under reverse charge since liability of recipient and provider are independent.. manish (Posted On: 05 Mar, 2013)

The exemptions contained in Mega exemption notification(either services provided by main contractor to government or provided by sub contractor to main contractor) is available in respect of “Service” and not in respect of “Person” i.e. ‘services’ provided by sub contractor to main contractor is exempt (if WC services provided by main contractor is exempt) and “Sub-Contractor” is not exempt. Therefore Main contractor will not be liable under reverse charge as services provided by sub-contractor are exempt.
Dear Sir, Some transporters are charging service tax @ 12.36% on their GR in spite of charging 3.09 %.My query is, Can we take the input of that full amount of Service tax charged by them? Thanks. Sudheesh K C (Posted On: 05 Mar, 2013)

Yes, You can take full credit. Availing of abatement is optional and if transporter charges @12.36, it means he has not availed the option of abatement. Further, there are number of decisions that the classification and valuation of supplier cannot be challenged at the end of receiver.
we are registered under service tax in faridabad and providing service in haridwar then we have to register there in yes then why? gaurav (Posted On: 05 Mar, 2013)

Already answered. Registrations are required to take in respect of premises from which service provider provides services and not the premises of service recipient. Therefore if organisation provides services from a premises other than its registered then it is required to take a separate registration. But if organisation provides services from registered premises then it is not required to take a separate registration even if receivers are located at different premises.
if any orgainsation provide service to their client which are located at another than registered area, then service provider have to registered at service receiver area under service tax or not. gaurav (Posted On: 05 Mar, 2013)

Registrations are required to take in respect of premises from which service provider provides services and not the premises of service recipient. Therefore if organisation provides services from a premises other than its registered then it is required to take a separate registration. But if organisation provides services from registered premises then it is not required to take a separate registration even if receivers are located at different premises.
Dear Sir, Kindly elaborate in line with para ((B) specified in sub-clauses), whether can we avail input service credit vehicles engaged for movement of goods within factory especially in cement industry from one place to another place (loading of Coal into conveyor belt). Sec. 2 (1) of the CENVAT Credit Rules, 2004 defines “input services” and states that “input service” means any service, – (i) used by a provider of taxable service for providing an output service; or (ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal, and includes services used in relation to setting up, modernisation, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services, inward transportation of inputs or capital goods and outward transportation upto the place of removal; (A) specified in sub-clauses (p), (zn), (zzl), (zzm), (zzq), (zzzh) and (zzzza) of clause (105) of section 65 of the Finance Act (hereinafter referred as specified services), insofar as they are used for– (a) construction of a building or a civil structure or a part thereof; or (b) laying of foundation or making of structures for support of capital goods, except for the provision of one or more of the specified services; or (B) specified in sub-clauses (d), (o), (zo) and (zzzzj) of clause (105) of section 65 of the Finance Act, insofar as they relate to a motor vehicle except when used for the provision of taxable services for which the credit on motor vehicle is available as capital goods; or (C) such as those provided in relation to outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits extended to employees on vacation such as Leave or Home Travel Concession, when such services are used primarily for personal use or consumption of any employee;”. T.GOPALA KRISHNA (Posted On: 05 Mar, 2013)

Firstly, in case of transport of goods service, service tax will be levied only when services are provided by GTA (GTA- which issues consignment note). If service tax is levied and it is inward transportation of goods then credit of service tax on freight in relation to movement of goods will allowed as it is covered under the definition of input service.
Hello A trust regd under section 12aa runs a school It is a school which provides nursery and primary education .This is not recognized However they also corse which is not CBSE but recognized by MCD education deptt Not by CBSE because it does not cover class X and XII Whether classes of nursery and primary i.e fees charged is liable to service tax pradeep (Posted On: 04 Mar, 2013)

No it is not liable to service tax. As per Sl. No. (l) of Negative list as given under section 66D, “Pre-school education and education upto higher secondary school and equivalent is exempt”. Nursery course and primary education is covered under this clause, therefore it will be exempt.
Hello There is a trust regd under section 12 aa It gives a part of the premises on rent to ICWA institute Is the service taxable They also carry out some vocational courses like tailoring/beauty parlour etc ,for which they charge a fees .These courses are not recognized Are thses liable to service tax pradeep (Posted On: 04 Mar, 2013)

As per notification no. 25/2012-ST, “Services by an entity registered under section 12AA of the Income tax Act, 1961 (43 of 1961) by way of charitable activities” is exempt from service tax. In our opinion Renting of Premises to ICWA is not a charitable activity, therefore service tax will be levied.
Prepared food supplied to outdoor Catrer like gravy, sauces etc will this attract service tax over and above value added tax of 12.5% tax ?? If yes how much and break up of both taxes ??& slab ?? Rahul Shah (Posted On: 03 Mar, 2013)

In our Opinion service tax will not be levied on supply of material to Outdoor caterers as it is a sale of goods and not a service.
Respected Sir, According to the knew budget, is there any change for the turnover limit of excise for the ssi units due to which they come in excise with effect from 01-04-13,as in the last budget it was Rs.4 crore mehul (Posted On: 02 Mar, 2013)

No there is no any change in the SSI exemption Limit. If the turnover in the previous year is lower than 4 Crores then exemption will be allowed upto Rs. 1.5 Crores in current financial year.
Rule 7 of CCR, 2004 prescribes manner of distribution of credit by Input Service Distributor. Credit of Service Tax shall be distributed on pro rata on the basis of turnover of the concerned unit to the sum total of turnover of all the units. In case non-clearances of a particular unit during a month, can we distribute the credit to the other units by excluding the said unit? A Ravindra Babu (Posted On: 02 Mar, 2013)

The Rule 7 of Cenvat Credit Rules 2004, describes that the credit is to be distributed in pro rata basis in the ratio of turnover. If a unit has no any turnover in a particular period then according to rule that unit itself not eligible for credit (as it has Zero Turnover) and credit will be distributed to other units only.
sir ministry of finance has imposed service tax on products transported through rail.some essential commodities like food grains , perishables, fertilizers have been exempted from service tax when transported through rail, but railways is charging/demanding service tax on demurrage amount levied on rakes which carried those essential commodities which have been exempted from service tax when transported through rail. is it justifiable on the part of railways? please guide us. thanks sukhjit singh (Posted On: 01 Mar, 2013)

The exemptions contained in the Mega Exemption Notification is allowed in respect of transportation services but demurrage charges are not a consideration for transportation service. Further it is specifically mentioned under Rule 6(1) of Service Tax (Determination of Value) Rules, that “the amount realized as demurrage for a service beyond the period originally contracted” should be included in the value of service. Therefore service tax will be levied on demurrage charges.
respected sir, We have digital photo printing and binding unit of wedding albums. Whether we have to pay service tax. samarth albums (Posted On: 01 Mar, 2013)

Yes, service tax will be levied as it is neither covered under Negative List Section 66D or under Mega Exemption Notification 25/2012-ST. Further it also not covered under Work Contract Service as the activity is not construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation or alteration activity. As this activity involves material also therefore valuation will be based on Dominant Nature Test. If material portion is dominant then service tax will not be levied otherwise service tax will be levied on 100% value.
Respected sir, I am a accountant in online portal.i have also a affiliation of online portal we sales through this web site but product dispatch through our place to customer but payment come through affiliation site. he deduct your commission than paid to us that is mean we sale the customer through website and payment come here.what is the sale entry in tally software. Manoj Singh (Posted On: 27 Feb, 2013)

We are dealt with service tax and excise laws. Ask the questions related to these matters only.
In case of outdoor catering services DVAT will be levied on gross value or on abated value under Service Tax? Manoj Jhanwar (Posted On: 27 Feb, 2013)

We do not deal with VAT Laws. Service tax will be levied on Gross amount charged excluding Vat and it is to be charged on 60% value of Gross amount excluding VAT.
Our Client is engage in the business of preparation of Advertisement Hording for the various companies. In this they do fabrication and printing work along with supplying the material. We are paying Vat on the entire bill amount. My question is that weather it attracts the Service tax or not ? SIMAL (Posted On: 27 Feb, 2013)

Yes service tax will be levied on this activity as it is neither covered under negative list nor under mega exemption notification. Further it is not covered under work contract service and service tax will be levied only on service portion not on material portion. However, if the value of material cannot be segregated then Rule of Dominant nature test will apply and accordingly value will be calculated.
When we need to file the II hly return for 12-13; Any new format of ST-3 for RCM workings..!! visu iyer (Posted On: 26 Feb, 2013)

Refer the Notification no. 01/2013-ST at http://www.new.capradeepjain.com/redirect_amdview_6311. The new format has been prescribed and also the last date is 25.03.2013 for filing of Return for period July to September 2012 but still the format is not ready on ACES for filing the return.
Respected sir, We are SSI unit manufacturing pvc tubing. We have crossed our turnover Rs. 90 lacs during the m/feb-13. Sir i want to know the whether we are liable to submit declaration to the excise department if us pl let me know under which format. KAILAS (Posted On: 24 Feb, 2013)

Yes, you are required to file a declaration to Deputy/Assistant Commissioner as prescribed under notification 36/2001-C.E. (N.T.) dated 26.6.2001 and as amended issued under Rule 9 of Central Excise Rules.
We are providing services of only labour work(without material) for electric fitting at Individual residence, new residential complex to be constructed new commercial complex to be constructed. My question is under which category my case will fall i.e. under which category i have to make application for service tax registration. LALIT GHIA (Posted On: 23 Feb, 2013)

You have to registered under category “services other than Negative List ( 00441480)”. The classification is only for statistical analysis only and it is no more important therefore classification should be done under more suitable category (because each service is not defined separately). However, the CBEC has required classification to be done in Registration also by notification number 48/2012 dated November 30,2012. You will fall under Residential complex service/ repair or maintenance service/ installation and commissioning service. You have to decide based nature of your contract.
How shall differentiate sponsorship and advertisement as both are categorised in revenue expenses under Publicity where sponsorship is taxable and advt is not taxable visuiyer (Posted On: 23 Feb, 2013)

Firstly it is clarified that all type of advertisements are not exempt. Only “Selling of Space and Time slot for Advertisement” is exempt. Further Sponsorship is an indirect advertisement and generally consideration is represented, other than by way of money e.g. organizing an event, distribution of prizes to winners. Sponsorship includes naming an event after sponsor, displaying the sponsor’s company logo or trading name, giving the sponsor exclusive rights etc.
Sir, our client is a SEZ unit in Noida and they are claiming refund for the Service tax payable to the service provider. Can the adjust their liability under reverse charge mechanism against the Service Tax claimed as refund or they have to pay?? CA Shweta Ojha (Posted On: 22 Feb, 2013)

No. Liability under reverse charge can’t be adjust against refund claim. Service tax liability under reverse charge should be separately discharged only in cash.
Sir If a company is constructing roads, gardens & other facilities in a residential complex or villas & receiving a certain percentage of the sale amt. of complex from the customer directly, whether it would be taxable. Mohit Jindal (Posted On: 22 Feb, 2013)

Yes it will be taxable as the activity is neither covered under negative list nor under mega exemption notification. Roads for general public are exempt. But road inside the residential complex cannot be termed as meant for general public.
Dear Sir, Service provided in India is just of identifying vendors for the parent company from where the vendors shall procure inputs directly. The inidian subsidiary shall receive the payment in foreign currency from parent company. As per Rule 6A read with POP rules, can it be called export of service. CA Irfat (Posted On: 22 Feb, 2013)

The service of identifying vendors for parent company, is not covered under definition of “intermediary service” as mentioned in Rule 2(f) of PPS Rules. Therefore Rule 9(C) of PPS will not be applied. As Rule 9(C) is not applied, Place of Provision will be determined as per general Rule 3 of PPS Rules. As per this rule, generally Place of Provision will be Location of Service Receiver. Hence in our opinion, in the instant case, place of provision will be non taxable territory (location of Parent company). As the place of provision of service is outside India and consideration is received in the convertible foreign currency,it will be treated as Export of service as per Rule 6A.
Dear Sir, We are aviling cenvat credit of service tax against premium paid towards marine insurance. This covers goods in transit as we have sales network across india. The premium is paid upfront for the entire financial year. Query is 1) whether cenvat can be availed towards service tax paid on such premium. 2) if affirmative then whether service tax credit can be taken upfront or on proportionate basis based on consumption only. Request your valuable views DM (Posted On: 21 Feb, 2013)

In our opinion, Cenvat Credit of Insurance premium towards marine insurance of final product is not allowed as the definition of input service as given under Rule 2(l) of Cenvat Credit Rules, 2004 defines input service as “any service used by manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal” This definition includes only services used ‘upto the place of removal’. Therefore, service tax credit on marine insurance of final product will not be allowed. However you may be eligible for refund under notification 41/2012-ST (effective after 1st July) if such service is treated as service used beyond the place of removal ‘for Export of goods’.
sir please clarify that if a service is covered by mega exemption list and is liable to reverse charge as well ,whether recipient would be liable to deposit service tax under reverse charge mechanism. Manish (Posted On: 20 Feb, 2013)

If service itself is exempt then no question of reverse charge arises i.e. reverse charge is applicable only when service is taxable.
we are a manufacturing unit in SEZ and use laundry Services. Factory uniforms used in production area are collected by laundry service provider from our sez location and delivered to us after washing. Washing activity is carried out outside sez. Please guide if Service Tax is payable on this activity in lights of notification No 40/2012 ST. naveen (Posted On: 19 Feb, 2013)

As per notification no. 40/2012-ST, services received by SEZ are exempt. The exemption is allowed by way of refund. However the direct exemption will be allowed if services are wholly consumed in SEZ.
Dear Sir, We are a small manufacturing concern (proprietorship)having turn over of below 2Cr. We are paying Cartage to transporters who is not charging any service tax on Gr. My query is, Does that create any liability for us to pay service tax? Thanks. Sudheesh K C (Posted On: 18 Feb, 2013)

If the “factory of manufacturer(Proprietor) is registered under or governed by the Factories Act, 1948 (63 of 1948)” then 100% liability of service tax on GTA service will on manufacturer otherwise no any liability. Secondly, the consignment note should be issued by GTA for levy of service tax. If it is local cartage only and the transporter is truck owner then service tax is not payable.
service receiver company engaged an professional firm of Corporate social responsibility to execute company's CSR Plan and provided a fund to incur it using his expert knowledge in the field of CSR. The firm is working as a pure agent and they will charge only professional fee and expenses incured in relation to CSR will be reimbursed by company or credited against advance deposited in a separate bank account. The firm further gives contracts to various contractor to execute different job like water pipe line, renovation of school etc. IN THIS CASE WHO WILL AVAIL CENVAT CREDIT FOR THE SERVICE TAX CHARGED BY SUCH CONTRACTOR ON THEIR BILLS. PRACTICALLY I THINK COMPANY SHOULD AVAIL THE CREDIT. BUT HOW COMPANY WILL AVAIL IF BILLS RAISED BY CONTRACTORS ON THE PROFESSIONAL FIRM. HOW THE PROCESS WILL WORK SO THAT CENVAT CREDIT CHAIN NOT BREAK AND COMPANY COULD AVAIL CENVAT CREDIT. PLEASE EXPLAIN jagmohan (Posted On: 18 Feb, 2013)

Pure agent has been defined in Explanation to sub-rule 2 of Rule (5) of the Valuation Rules as a person who- “1• enters into a contractual agreement with the recipient of service to act as his pure agent to incur expenditure or costs in the course of providing taxable service; 2• neither intends to hold nor holds any title to the goods or services so procured or provided as pure agent of the recipient of service; 3• does not use such goods or services so procured; and 4• receives only the actual amount incurred to procure such goods or services.” The above definition of Pure agent makes it clear that the invoice for services received as pure agent should be in name of principal not in name of pure agent and pure agent can’t use these service(point no. 2 & 3). In the instant case, If CSR Firm is covered under the definition of pure agent (i.e. the above 4 conditions satisfy) then credit of service tax will be allowed to the company on expenditure incurred by CSR Firm on behalf of company. In such case value of service provided by CSR firm will be equal to professional fess only and service tax will be charged only thereon i.e. service tax will not be charged on reimbursed amount. But if the above conditions not satisfied then CSR Firm will not covered under the definition of pure agent and service tax will be leviable on whole amount charged by CSR i.e. Professional Fees + Expenditure reimbursed and in such case credit of expenditure incurred by CSR will be allowed to CSR Firm and not to Company. However credit of service tax charged by CSR Firm on Total Amount (i.e. Professional Fees + Expenditure reimbursed) will be allowed to the company. As you are saying that bills of Contractors are raised in the name of CSR Firm therefore CSR Firm is not treated as pure agent and credit will not be allowed. The arrangement should be done as to that the CSR firm will cover under the definition of pure agent and then credit will be allowed to the company. Further in case of CHAMUNDI TEXTILES (SILK MILLS) LTD. [2010 (20) S.T.R. 219 (Tri. - Bang.)] it has been decided that credit of service tax levied on expenditure incurred by pure agent on behalf of principal, will be allowed if reference of principal is given in the invoice.
we award pure labour contract for radial gate painting,materias supplied by department.Are we liable to insist for 100%ST remittance proof from contractor as service receipent. ramananda rao (Posted On: 17 Feb, 2013)

You query is not clear. In case of pure labour contract, reverse charge does not applies and recipient is not required to obtain any evidence from service provider. Further, when the liability to pay tax is on provider, there is no liability on recipient.
Dear sir we are registered under erection commisioning and maintenance and doing work contracts i.e.(labour + supply) and seperate contracts also..However on our work contracts 4% WCt is deducted at source by Clent and submitted to State Governmnet as VAT.Then is there is any liability for Service Tax also or not.and also if we can bifurcate some contracts in labour and supply and cant bifurcate between some then what is the criteria of assesing the same upto Financial year 2011-12 DIVESH AGGARWAL (Posted On: 17 Feb, 2013)

Yes service tax will be levied as it is a work contract service. If you can bifurcate the labour portion then service tax will be levied on labour portion only @12.36%. But if the material and labour portion can’t be segregated then: “(A) in case of works contracts entered into for execution of original works, service tax shall be payable on forty per cent. of the total amount charged for the works contract; (B) in case of works contract entered into for maintenance or repair or reconditioning or restoration or servicing of any goods, service tax shall be payable on seventy percent. of the total amount charged for the works contract; (C) in case of other works contracts, not covered under sub-clauses (A) and (B), including maintenance, repair, completion and finishing services such as glazing, plastering, floor and wall tiling, installation of electrical fittings of an immovable property , service tax shall be payable on sixty per cent. of the total amount charged for the works contract”
Sir, We are in to manufacturing and does not provide any services.Can we take the input on service tax paid on Stock & Building Insurance premium? Thanks. Sudheesh K C (Posted On: 16 Feb, 2013)

As per definition of Input service as given under Rule 2(l) of Cenvat Credit Rules, 2004, input service means, any service used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal. Further the definition also include services in relation to accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services etc. Therefore credit of insurance premium of factory building and stack will be allowed as it is used for manufacturing and is not excluded from the above definition of input service.
Sir, we have procured a capital goods in April,2010 and availed in April, 2010. Balance 50% credit has taken by us next financial year 2011-12 i.e. in April, 2011. Now we intend to remove this captial goods after use. As per CCR we can claim 2.5% depriciation per quarter from April, 2010 onwards. In this regard, I want to know your valuable advise whether we should also consider April, 2011 for claiming depriciation 2.5% for balance 50% balance credit. As per my knowledge, 2.5% depriciation will be calculated on entire duty amount from April, 2010. Kindly confirm whether my understanding in order. Your immediate response in this regard, will be highly appreciated. Kamal (Posted On: 16 Feb, 2013)

As per Rule 5A of Cenvat Credit Rules, 2004, if capital goods removed after being used, the manufacturer or provider of output service shall pay a duty equal to the higher amount from following i.e. (1) or (2) whichever is higher:- 1. Cenvat Credit Taken minus 2.5% for every quarter or part thereof from the date of taking the Cenvat Credit. Or 2. Duty leviable on Transaction value (sale value) Further the depreciation of 2.5% under above point (1) shall be deducted from the date of taking the Cenvat Credit. In our opinion for the purpose of this deduction, the date of taking Cenvat credit first time should be considered.
Sir, in hotel industry. normally room are provided @ Rs.2000/- with breakfast and lunch free and they are paying service tax on lunch @ 500/- per plate and breakfast@150/- per plate as their decided price @4.944 and balance under accomodation service7.416%. This method is correct. Please provide legal position. CA Sanjeev Mishra Jaipur (Posted On: 15 Feb, 2013)

It is not a correct treatment. When two or more services are provided in a composite contract like this i.e. room along with breakfast and lunch are provided then it is naturally bundled service. In this case, the service which gives colour to whole transaction the service tax will be charged under that head. In this instant case, room stay is giving colour to complete service. Hence, it will be covered under Accommodation service. Thus, the service tax will be charged @ 60% under notification 26/2012-ST dated 20.6.2012.
Mr. A inaugurated office on 1st April 2013. Will he be eligible for SSP exemption (E/N 33/2012) in 2014-15 if his income in 2013-14 is as follows (each case is an individual case): Case 1. Receipts from fashion designing: Rs 4 lakhs; Receipts from service station with brand name of Maruti: Rs 8 lakhs Case 2. Receipts from fashion designing: Rs 4 lakhs; Receipts from GTA business: Rs 8 lakhs Case 3. Receipts from fashion designing: Rs 4 lakhs; Receipts as insurance agent: Rs 8 lakhs Case 4. Receipts from fashion designing: Rs 4 lakhs; Receipts from service of supply of manpower [to corporate clients]: Rs 8 lakhs Also, in case no. 4, on what amount will he be required to pay service tax in 2013-14 - entire Rs 8 lakhs or only Rs 2 lakhs(i.e., after availing balance exemption of Rs 6 lakhs (10 lakhs-4 lakhs)? Varun Verma (Posted On: 15 Feb, 2013)

Case 1:- Exemption will not be allowed as aggregate value of taxable services in the previous year exceed 10 Lakhs(service provided in the Brand name will also be included as per definition of “aggregate value” in the notification. Case 2:- In case of GTA business, value of service provided in which reverse charge applies(service tax is payable by receiver) shall not be considered for the purpose of calculating aggregate value of 10 Lakhs therefore from the value of Rs. 8 Lakhs if value of Rs. 2 Lakhs or more is payable under reverse charge then exemption will be allowed otherwise not. Case 3:- Exemption will not be allowed. Case 4:- Exemption will not be allowed. in 2013-14, service tax will be levied after availing crossing exemption limit as in 12-13 it has no any turnover therefore service tax will be levied on 2 lakhs.
Sir, I want to know - - how an Interior Decorator's service is chargeable to Service Tax in FY 10-11, FY 11-12 & FY 12-13? - Whether any abatement is available? - How to compute the assessable value? - Can we bifurcate it into Works Contract activity and the like and ID's Service? - Whether Reverse Charge Mechanism applies? - Please also clarify whether there is a difference between Interior Decorator and Interior Designer, which makes the difference in chargeability of Service Tax from their Client Kindly Reply, heavily confused please help me to get out of this...... Vishwanath (Posted On: 14 Feb, 2013)

Prior to introduction of negative list service tax was leviable on the services specified in Section 65(105) and each service had defined separately. Prior to negative list interior decorator service means, services by way of advise, consultancy, and technical assistance or in any manner, related to design or beautification of spaces. Earlier there was no any abatement for this service. After introduction negative list each service is not defined separately and a few services are defined. Now in service tax, definition of interior decorator service is not given and the service is also not covered under reverse charge mechanism. Further the service can only be categorized if the service is satisfied the definition of work contract service as given u/s 65B(54). Also, there is no any difference in treatment of service tax on interior decorating or designing. Under negative list concept, there is no any definition of interior decorating or designing. The same tax will be applicable to both of them.
We are manufacturers. we are paying to transporters, who are delivering the goods to our consumer place... For that we are collecting freight/carriage seperately in the sales bill. we are collecting more than we paid to transporters.... we are getting service from registered and unregistered transporters... tell me GTA impact in that .. Thanking You in advance... KEERTHANA (Posted On: 14 Feb, 2013)

At the time of payment to transporters you will be liable under reverse charge as service recipient. Further in case of collecting freight or extra freight from customer by adding freight separately in the bill, you will not be liable for excise or any service tax. Excise will not be levied as it is not a part of value of goods and service tax will also not leviable as services by way of transportation of goods by road is exempt unless it is provided by goods transport agency.
Sir, Our client is importing airtime and simcards from outside india and it is selling the same in india to distributor and customer(going outside) but simcard and airtime can be used only outside India not in India. So my querry is whether our client is falling in intermediary service provider and what would be application of place of provision rules Ashish Joshi (Posted On: 14 Feb, 2013)

Sl. No. 29(f) of Mega Exemption Notification Exempts “services by selling agent or a distributer of SIM cards or recharge coupon vouchers in their respective capacity”. Therefore service tax will not be leviable on the services provided by these agents.
Dear Sir, eeking your expert openion on following issues: Clent providing xerox per page @ Rs.1/- 1. Whether Xerox covered under Service Tax. 2. If cover, then pls specify Service Head 3. is any abatement for paper, ink used in Xerox. 4. Position before Negative list & After. Thanks, Waiting for your valuable reply. Thanks CA Radhesham Bhutada Pune Xerox Service (Posted On: 13 Feb, 2013)

Prior to Negative list it is not taxable because it is not covered under any of the service. After introduction of negative list, service tax is leviable on all the services. When the material and labour are together then it should fall under works contract. But xerox is not covered under Work contract service as scope of work contract in Service tax is limited to repairs, maintenance, construction, installation etc.The Xerox involved material as well as service portion also i.e. it is a composite contract but it is not repairs, maintenance, construction or installation etc . Hence Xerox service does not fall under “work contract”. Xerox contract involved material as well labour but it is not fall under work contract therefore we have to test dominant nature test. In our opinion, material potion is dominant in the Xerox contract therefore service tax will not be leviable.
Dear Sir, We have a manufacturing company with turnover of 14 cr. We have received SCN from excise regarding two issues. Firstly, Till 2011, we were only supplying locally. On 2012 onwards, we started exporting. When we applied for LUT, they put a seal on Bond, without mentioning the validity period. We thought that LUT doesn't require revalidation and exported using the same LUT no. in the ARE1, after 1 month of LUT expiry. later, Range Superintendent informed us to get new LUT. The new LUT has the validity period mentioned on it. Now, we have received a Show cause Notice,under rule 19 Central Excise Rules 2002, for exporting under expired LUT. In the first LUT, the validity was not mentioned and we were not informed of the same. Whereas, in the second LUT, the validity is clearly mentioned. Kindly advise on our defence in this situation. Secondly,they have imposed Penalty under Rule 27 Central excise rules 2002, for not filling triplicate copy of ARE1 within 24hrs. We usually export on Fridays. Saturday and Sunday, there is no facility for receiving the copies. Hence, we submit on Monday. Doesn't this account as within 24 'working' hours? please Advise... E N. Ramachandra (Posted On: 13 Feb, 2013)

Although it is clear that the LUT is valid for one year. But you can plead that when the export has taken place and the proof of the same has been filed then it is procedural lapse. Further, there was lapse on part of the department also and they should have informed you that the LUT is going to expire and we should get new LUT. Secondly, there is provision in General Clauses Act that when a particular act is to be done by a particular date and there is holiday on that date then it automatically taken as next working day. Hence, there is no delay and as such no question of imposition of penalty.
Dear Sir, We have a manufacturing company with turnover of 14 cr. We have received SCN from excise regarding two issues. Firstly, Till 2011, we were only supplying locally. On 2012 onwards, we started exporting. When we applied for LUT, they put a seal on Bond, without mentioning the validity period. We thought that LUT doesn't require revalidation and exported using the same LUT no. in the ARE1, after 1 month of LUT expiry. later, Range Superintendent informed us to get new LUT. The new LUT has the validity period mentioned on it. Now, we have received a Show cause Notice,under rule 19 Central Excise Rules 2002, for exporting under expired LUT. In the first LUT, the validity was not mentioned and we were not informed of the same. Whereas, in the second LUT, the validity is clearly mentioned. Please advise on defence of this situation. Secondly,they have imposed Penalty under Rule 27 Central excise rules 2002, for not filling triplicate copy of ARE1 within 24hrs. We usually export on Fridays. Saturday and Sunday, there is no facility for receiving the copies. Hence, we submit on Monday. Doesn't this account as within 24 'working' hours? please Advise... e N. Ramachandra (Posted On: 13 Feb, 2013)

Reply:- Although it is clear that the LUT is valid for one year. But you can plead that when the export has taken place and the proof of the same has been filed then it is procedural lapse. Further, there was lapse on part of the department also and they should have informed you that the LUT is going to expire and we should get new LUT. Secondly, there is provision in General Clauses Act that when a particular act is to be done by a particular date and there is holiday on that date then it automatically taken as next working day. Hence, there is no delay and as such no question of imposition of penalty.
sir please clarify me on the following situation:- in case of a pure labour contract, where the manpower works under the control of contractor and not under principal employer, are chargeable under which head of taxable service Rakesh (Posted On: 13 Feb, 2013)

After introduction of negative list concept, importance of classification of services are limited in some areas e.g. reverse charge, exemption etc and every service is not defined separately. As the contract is pure labour contract, the reverse charge will not be applicable. However, classification has been reintroduced by recent circular number 165/16/2012 by CBEC only for the purpose of payment only. The CBEC has introduced old list of 120 services for the purpose of payment by different accounting codes and if any service is not covered under list of 120 services then the payment of this type of service will be done under head “Service Not in Negative List”.
How do we calculate notional rent on security deposit? The security deposit was partly invested in saving account and partly used for repaying loan Suruchi Agarwal (Posted On: 13 Feb, 2013)

As consideration includes also Non- Monetary consideration therefore Service tax is applicable on Notional Interest of security deposit also. But in our view it is only if it has a substantial impact on main consideration of the service and terms of services.
Sir our Query is, We are a sez unit situated in zone (in Guajrat) , we purchase cotton yarn from a party in south and issue I form to them. Now they are asking us to issue them H form. They are claiming for refund from the sales tax department in their state (Andhra Pradesh) on input tax credit paid on purchase of Cotton as raw material to produce yarn. The officer from the department has informed them that they will be entitled for the refund only if they are able to produce H form to them, from the party to whom it has made deemed export. We look upon for your expert opinion/ advice , what is the correct procedure and what can be done in this regard. Ca Seema Saraogi (Posted On: 13 Feb, 2013)

We not deal with sales tax and VAT matters. Please ask queries related excise and service tax.
Whether name of the Job Worker can be included in the IEC of the Principal Manufacturer. RAHUL MANDAL (Posted On: 13 Feb, 2013)

No, when IEC is to be taken for Principal Manufacture then how the name of Job worker is included.
sir, our factory is under in GRAM-PANCHAYAT,so can we need SHOAPACT LICENSE, OR ANY OTHER DOCUMENTS, somnath (Posted On: 12 Feb, 2013)

We deal in service tax, excise and customs. ask queries related to these matters only.
The service provider of rent on immovable property died in sept, 2011. What is his liability with regard to rent from immovable property before his death and after his death? Arjun Sharma (Posted On: 12 Feb, 2013)

There is no separate provision in this regard. If there is any pending liability then legal heir of service provider will be liable for the same and thereafter if contract is continued then legal heir himself will service provider and liable for service tax.
Dear Sir, We are providing services of repairs and maintenance to Navy /Coast Gurard and had been enjoying exemption from service tax and the said notification was recinded by 34/2012. Now under the negative list can we still claim exemption under section 66D for service provided to Central government. Request your valuable views DM (Posted On: 12 Feb, 2013)

The exemptions related to services provided to Government is prescribed in Mega Exemption Notification 25/2012-ST and not in Negative list. Further Navy is covered under the meaning of Government. As you have not mentioned that what type of repairs or maintenance service is provided to Navy therefore we can’t say whether it will exempt or not. So you have to see the Notification 25/2012-ST that whether your service is covered under any of the clause of the mega exemption notification under services provided to government. You can see the Notification 25/2012-ST at -http://www.new.capradeepjain.com/redirect_amdview_5957_3
Sir ji.. IS CENVAT credit on sponsorhsip is eligible for availing input credit? As tax on SPONSORship service is payable by the service receiver. visu iyer (Posted On: 11 Feb, 2013)

Already answered. The sponsorship service is also of the nature of advertisement therefore credit will be allowed if it is used for providing output service or used in relation to manufacturing.
Dear Sir, We are Importer of Machinery. When we Imported a machine we contract with a shipping agency. My question is that can we take credit of Service tax if foreign shipping agency deliver the machinery and made a bill in the name of indian shipping agency and the amt. paid to foreing shipping agency by the indian shipping agency. and in bill we are mentioned as importer. Please solve it Sir. In above reference please tell me that can we take credit of the ST paid by indian shipping agency on our behalf if bill is raised in the name of shipping agency Saurabh Khandelwal (Posted On: 11 Feb, 2013)

Yes, you can take the Cenvat credit on bill of Foreign Shipping Company if your name is mentioned in the bill of foreign shipping company
Dear Sir,We were in a MOU with A government public enterprise to retrofit seats and berths in Coaches made available by the Railways to them. These Works Contracts were different for each Railway. The Railways issued Works Contracts on the Public Ent. and they back to back issued a works contract order on us.Sir we were supposed to assemble all items regarding berth fitment at the station itself,but due to space problem, we got the items related to making seat/berths in our factory premises.Earlier we paid Works Contract tax under Compensation Scheme on the entire work executed,but the Excise Auth. as a result of Search Seizure told us that the Seat Berths leaving from our Factory were excisable and hence we paid the entire duty on such berths and Seats available.but now they have again issued a show cause notice? demanding to pay duty on even bought out itms reqd. for fitmtnnt. Sir, pl advise if r lablle to such duty in totslity ? Ekta Agarwal (Posted On: 11 Feb, 2013)

If the activity of assembling the berth seats amounts to manufacture then excise duty will be leviable on this activity (as per rate prescribed for that tariff head) and then service tax will not be leviable on that portion. Because as per clause no. (f) of negative list as given u/s 66D exempts any process amount to manufacture. But if the process does not amount to manufacture then excise duty will not be leviable and service tax will be leviable on entire contract as per provisions applicable to work contract service.
Dear Sir, We have paid service tax for few heads twice on 6th of Feb,2013, Can we adjust against future payments or we need to go for refund claim? regards Dakshina Murthy DAKSHINA MURTHY (Posted On: 11 Feb, 2013)

As per Rule 6(4A) of Service Tax Rules 1994, "Notwithstanding anything contained in sub-rule (4), where an assessee has paid to the credit of Central Government any amount in excess of the amount required to be paid towards service tax liability for a month or quarter, as the case may be, the assessee may adjust such excess amount paid by him against his service tax liability for the succeeding month or quarter, as the case may be." Further Rule Sub Rule 4B of Rule 6 provide that “the adjustment of excess amount paid under sub Rule 4A shall be subject to the condition that the excess amount paid is an account of reasons not involving interpretation of law, taxability valuation or applicability of any exemption notification” So according to above provisions you can adjust the excess amount paid towards your succeeding month or quarter’s liability subject to the fulfillment of conditions mentioned in sub rule 4B. But the adjustment is allowed only for the succeeding month or quarter’s liability.
Sir, An Indian Company has sold and exported a machinery to a Gulf company. Before its warranty period is over, snags are reported and the Indian company with the consent of Gulf company informally arranges a local firm in Gulf to rectify it , The gulf company pay the charges and claim its refund form the Indian Company as it is under warranty.Whether it would be taxable (not an intermediary service I believe)? since both beneficiary and provider are abroad but payment made under contractual obligation? Kindly give your valuable opinion on this? subramanian (Posted On: 10 Feb, 2013)

In our opinion it is not taxable as no any service is received by the Indian Company. Local firm of Gulf is arranges by Foreign company itself, not by Indian Company and Indian company is not involved in this transaction. However, the department will not endorse this view and litigation is inbuilt.
Reversal of Wrong/excess cenvat credit taken in earlier Months where to show reversal of that amount in ER1 manjunatha (Posted On: 09 Feb, 2013)

The reversal of excess Cenvat credit has to shown in the column of “credit utilised for other payment” as given in 5th Sl. No. of ER-1 Return.
Dear Sir, My client is engaged in Manpower services.They pay Searvice tax @ 25%(as reverse charge mechanism is applicable in case of some cos.).the query is whether CENVAT credit can be availed agast the payment of 25% service tax. If allowed, do we have to calculate it on a Proportinate basis i.e. 25% CENVAT Credit. Smija (Posted On: 09 Feb, 2013)

For taking Cenvat Credit, we have to see the definition of input service as given in the Rule 2(l) of Cenvat Credit Rules, 2004. As per this definition, input service means any service used for providing output service. Therefore in your case, credit will be allowed on those services which used for providing output service of manpower supply service. Further the credit will be allowed 100% not 25% because under reverse charge payment of service tax payment (either wholly or partly) is made directly by service receiver but it does not mean that credit of that portion will not allowed.
Dear Sir, Our flat owners association has registered with register of companies under section 25 of Companies act 1956 as non-profit organisation. Is our association also has to registered with service tax as recipient of services from our vendors and applicable for reverse system payments. P.seth (Posted On: 08 Feb, 2013)

It depends upon the fact that which services you are receiving and what is the status of service providers. For example in case of security service, manpower supply service or work contract reverse charge will apply if service provider is individual, proprietor, HUF and receiver is body corporate. Similarly in case of legal services, reverse charge will apply if receiver is business entity. As you have not provided that which services you are receiving and what is the status of service provider, it is difficult to say that you have to registered or not. So ask query with complete detail.
Sir, we have installing cctv camera in our factory so can we taken installation service charges credit for excise utilization purpose & which notification under we are taken, SOMNATH BHAPKAR (Posted On: 08 Feb, 2013)

For taking Cenvat Credit of Input service, we have to see whether the this service is covered under the definition of ‘Input Service’ as given under Rule 2(l) of Cenvat Credit Rules, 2004 or not? As per this definition, input service means, any service used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal. Further the definition also include services in relation to accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services etc. As installation of CCTV cameras is a service in relation to security therefore credit is allowed. For more detail refer Rule 2(l) of CCR,04.
Sir ji.. Pl. advise.. Is CENVAT is available for SPONSORSHIP service. I un'stand the service tax is to be paid for Sponsorship service under reverse charge. Can we claim CENVAT also? visu iyer (Posted On: 08 Feb, 2013)

Cenvat credit of any input service is available if it covered under the definition of Input service as given Rule 2(l) of Cenvat Credit Rules, 2004. As per this definition input service means “any service used by a manufacturer whether directly or indirectly, in or in relation to the manufacture of final product and clearance upto the place of removal” or “any service used for providing output service”. Further the definition also includes services in relation to advertisement and sale promotion. The sponsorship service is also of the nature of advertisement therefore credit will be allowed if it is used for providing output service or used in relation to manufacturing.
Is service tax paid on insurance premium eligible for cenvat credit to works contractor? Liladhar Jhanwar (Posted On: 07 Feb, 2013)

Credit is allowed if the service is covered under the definition of Input service as given under Rule 2(l) of Cenvat credit Rules, 2004 i.e. if such insurance service is used for providing output service of work contract. However, this definition excludes services of insurance of motor vehicle or health insurance of employees.
Dear sir, My company has engaged an individual contractor, who fabricate scruber (includes civil work also). we are providing him materials like cement, steel, Bars etc. and contractor is providing sand, gitty as required. is this works contract service? if no, how much service tax should contractor charge? and if yes, on which value the service tax is payable by company? kindly reply. Regards, Parmeshwar Rathi (Posted On: 07 Feb, 2013)

I have already answer your earlier query but in earlier query you have not mentioned that contractor is also providing any material. So if the contractor is providing material also with labour then the service will be covered under definition of work contract and reverse charge will apply. In case of work contract service, under reverse charge 50% liability shall be on service receiver. Therefore you are liable for 50% liability of service tax. Further the service tax will be leviable on service portion (labour charges or total amount charged minus material value). But if the material and labour portion cannot be segregate then value of service portion will be determined as per Valuation Rule 2A. The free supply of material will also be added for calculation of service tax.
Dear Sir, A flat is allotted to a tenant in lieu of tenancy rights that he was holding in respect of that property. He is only charged for the following: 1.) Construction Cost 2.) Market Value for excess area allotted over and above his tenancy rights. Whether service tax would be charged to him on only construction cost & market value of excess area OR Stamp Duty Value at the time of transfer of property OR on value of flats sold to similar buyers at or about the same time. Secondly in case the building is 50% complete at the date of entering into an agreement, then whether service tax is leviable on 100% value of the agreement or only 50%. Rohan Jain (Posted On: 06 Feb, 2013)

Service tax is chargeable on value of service i.e. on consideration and as per Explanation (a) to section 67 of the Act “consideration” includes any amount that is payable for the taxable services provided or to be provided. Further consideration may be monetary or non monetary. As per clause (ii) of sub-section (1) of section 67 of the Act where the consideration received is not wholly or partly consisting of money the value of taxable service shall be the equivalent money value of such consideration. Therefore in the instant case consideration is “Amount charged from service receiver + Money value of Tenancy Rights”. If the same (i.e. money value of non-monetary consideration) is not ascertainable then the value of such consideration is determined under clause (iii) of section 67 read with rule 3 of the Service Tax (Determination of the value) Rules 2006 “On the basis of gross amount charged for similar service provided to other person in the ordinary course of trade”. For second question:- the service tax is leviable on value of service provided and value means consideration i.e. any amount that is payable for the taxable services provided or to be provided. Therefore there is no any effect of the fact that building is 50% completed or 100% and service tax will be leviable on value of service (the rules for determination of value is already discussed above).
please provide the time limit to isuue show cause notice under service tax laws by the departement if its issued after time is void ?? jignesh vora (Posted On: 06 Feb, 2013)

As per section 73, the time limit for issuing of Show cause Notice is “eighteen months”. But if there is fraud, collusion, willful mis-statement or suppression of facts etc. is involved then time limit for issue of Show Cause notice will be “Five years”.
Transfer of export licence granted by DGFT for export of sugar quota to other parties.The sugar unit receives quantity based consideration .Whether this amount is taxable and under which service tax category. Tariq (Posted On: 06 Feb, 2013)

In my opinion service tax will not leviable on transfer of export license because it is sale of Sugar Quota of export represented by license. But if the license is temporary transfer e.g. through rent (if allowed) then service tax may leviable
Respected Sir, We have applied refund of service tax on indian commission paid against export sale under notification no.17/2009 date 07.07.2009.But department is not allowing us refund on the contention that it is nowhere mentioned under notification no. 17/2009 dt 07.07.2009 that refund on indian commission on export sale is allowable refund.Please guide whether refund is allowable or not.If not then under which notification we can calim refund as we are paying the same to the concerned agents.Thanks Parveen Kumari (Posted On: 06 Feb, 2013)

The “Sale Commission Agent Service” was not specified in the Notification 17/2009-ST, therefore it is not eligible for refund under notification 17/2009-ST. However, the exemption of service tax was provided under Notification 18/2009-ST when the service was provided by foreign commission agent. Now the notification 17/2009-ST is not effective and refund of services used for export is governed by notification no. 41/2012-ST. As per this notification, the rebate shall be granted by way of refund of service tax paid on the specified services. ‘Specified services’ means, “taxable services that have been used beyond the place of removal, for the export of said goods”. Therefore it depends upon the interpretation that whether commission agent is covered under “used beyond the place of removal, for the export of said goods”. In our opinion, sale agent service is not covered under this definition of “specified services”. But in many cases, it has decided that sale agent service is covered under the definition of Input Service given under Rule 2(l) of CCR, 2004 so alternatively you may take credit of service tax for this service.
Dear Sir, I have been charging service tax on rental income from my industrial property and I purchased a residential builder flat & a commercial shop .On both the builder are charging service tax from me . Now I want to know that can i adjust my paid service tax to the builders from the service tax received on rental income Thanks Arun Kumar Sharma (Posted On: 05 Feb, 2013)

Definition of Input service as given under Rule 2(l) of Cenvat Credit Rules excludes work contract services and construction services used for construction or execution of work contract of a building. So the definition excludes work contract services and construction service related to building therefore credit will not be allowed to you.
Dear sir, we want to know about if packing charges charged on fabric packing in case of job work. whether service tax liviable on packing charges? if not tell me reason about it. pradeep (Posted On: 05 Feb, 2013)

Sl. No. (f) of Negative List given u/s 66D exempts “any process amount to manufacture” and sl. No. 30(C) of Mega exemption Notification Exempts “Carrying out an intermediate production process as job work in relation to any goods on which appropriate duty is payable by the principal manufacturer”. So if the packing activity is not amount to manufacture or appropriate duty is not payable by the principal manufacture then service tax will be leviable.
Dear sir, I want to know that ceiling of exemption turnover amount 1.5 crore in excise include vat and cst that we charge on turnover. or vat or cst amount excluded in 1.5 cr limit ravi khemka (Posted On: 04 Feb, 2013)

No VAT or CST is not considered in calculation of Turnover of Rs. 1.5 Crore for the purpose of Value based exemption(SSI exemption).
Dear Sir, Good Evening ! This is regarding Supply from DTA to SEZ Unit. Our company is the manufacturer, elligible for Cenvat Credit. Generally we purchase excisable goods from other manufacturer and sold to customer. In present situation, we are interested to sale the excisable goods from manufacturer to customer directly. The customer is SEZ Unit , elligible for excise exemption against ARE-1 & Cst against form-I. Since we have more modvat credit we don't want to purchase and again sale to SEZ unit. We want to sale dircltly from Manufacturer to SEZ. Is it possible ? If yes , please guide me? With Warm Regards, Prasanta Prasanta (Posted On: 04 Feb, 2013)

You can sale the goods directly from the premises of manufacturer to SEZ Unit. In such case all the procedure of ARE-1 should be followed and ARE-1 should be signed by both parties. The same rule relating to physical export applies to export to SEZ.
Wish to know if service tax is payable under reverse charge on upfront fees payable towards ECB Loan Whether as per place of provision this would fall under the taxable category of Banking and Other Financial Services and servaice tax would be payable by the borrower. Regards DM associatedm (Posted On: 04 Feb, 2013)

As you have not made clarification about the nature of Upfront fees, therefore it can’t be straight away possible for us to say that service tax will be leviable or not. Prima facie service tax will be leviable on these charges under reverse charge as General Rule 3 of Place Of Provision is provided that generally place of provision means location of service receiver. Further the Rule 9(a) of POP will not be applied here because this rule applies where “services provided by a banking company or financial institute to its account holders”.
Sir, we have engaged a carpenter contractor, for making furniture in our newly constructed building. he is to pay @ 35% of the total material purchased for his work. we are purchasing the material and he does the work on it. my quary is, can it be treated as "Works contract"? and we are liable to pay st (we = Public Ltd company; and Contractor = individual) Parmeshwar Rathi (Posted On: 04 Feb, 2013)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” In the instant case, transfer of material is not involved and material is provided by service receiver therefore it is not covered under the above given definition of ‘Work Contract Service’. Hence, reverse charge will not be applicable.
We have mistakenly paid 100% gta service tax from april 2008 to december 2008 and the same take cenvat credit, then what we will do? subhas kundu (Posted On: 04 Feb, 2013)

As you have made the 100% payment therefore no problem will arise for taking credit 100%.
In case of Builders - 1. Whether Builder paying service Tax @3.09% will be able to get CENVAT Credit on Service Tax paid under reverse method or service tax paid on input services or excise on CG/Inputs etc In short whether he will get any type of credits against his service tax liability or not? 2. whether service tax is to paid on every installments received from customers or it is to paid once as per MVAT on agreement to sales RVB (Posted On: 04 Feb, 2013)

1. In case of construction services for claiming abatement of 75% the notification 26/2012-ST specifies the condition that, “CENVAT credit on inputs used for providing the taxable service has not been taken under the provisions of the CENVAT Credit Rules, 2004.” Therefore credit of inputs will not be allowed, however credit of input services and capital goods will be allowed. 2. As per POT Rules, in case of ‘continuous supply of service’ (as also in instant case) Service tax shall be payable on the basis of completion of each even in term of a contract, on which the receiver of service requires to make any payment to service provider, and not at the time of sale. You have to make payment of service tax from earlier of the (a) date on which installment received or (b) date of progressive invoice.
hello sir i want to know the detailed proovision of service tax relating to man power supply service akash gupta (Posted On: 03 Feb, 2013)

Rule 2(g) of Service Tax Rule, 1944 defines supply of manpower to means:- “supply of manpower temporarily or otherwise to another person under his superintendence or control”. The essential character of manpower supply service is that the manpower should work under the superintendence or control of service receiver. Further as per Notification 30/2012-ST, reverse charge is applicable under manpower supply service if “service is provided by any individual, Hindu Undivided Family or partnership firm, whether registered or not, including association of persons, located in the taxable territory to a business entity registered as body corporate, located in the taxable territory” If reverse charge is applicable then service provider will be liable for 25% service tax liability and remaining 75% service tax liability will be on service receiver.
our head office (Hyderabad) is registered as Input Service Distributor. Now,we have taken a consultancy opinion with regard to development of railway connectivity in karnataka. We have no any factory in Karnataka. the Invoice is on Head office name. can we take credit of service tax paid thereon and distribute to our units in AP and gujarat?? vijay kumar nandipati (Posted On: 02 Feb, 2013)

Yes you can take and distribute the credit of service tax paid for consultancy opinion.
We have mistakenly paid 100% GTA insteade of 25%. Out of 100% we have taken credit of 75% of the amount on CENVAT from the period of April 2008 to November 2008 and officialy reflected the matter in our corresponding return.As wrong utilization of cenvat the department has accused us under section 11AC and demanded 75% amount with equal amount of of penalty which seems to be illogical & unauthentic. what will be our stand against the demand of the department with specific laws. subhas kr kundu (Posted On: 02 Feb, 2013)

The Abatement scheme is optional and assessee can either avail the benefit of abatement or not. He can opt for no abatement and can make 100% payment and then credit will be allowed 100%. Further the penalty of 11 AC is levied only when duty is not paid or short paid with intend to evade payment of duty, but in the instant case there is no any evasion of duty because assessee has paid 100% duty and then has taken credit.
whether central excise duty/service tax attract on advance received by costmers in company shridhar m dixit (Posted On: 02 Feb, 2013)

Excise duty is leviable on invoice basis i.e. total excise duty is leviable when goods are removed from the factory of manufacturer. Hence , it is not applicable on Advances received from customer. Further in service tax law, if the advance is received for the provision of service, then service tax will be leviable.
Dear sir, Is job work receipt taxable for a registered dealer of plywood? santosh (Posted On: 01 Feb, 2013)

For job work to be taxable, following things is to be seen:- 1. Whether the process undertaken amounts to manufacture under Central Excise? if yes, then no service tax is payable. 2. If the answer of 1 is "no" then we have to see whether the process is a intermediate process and the supplier manfuacturer is paying excise duty on finsihed goods manufactured from such job work goods. If so, then no service tax is payable. There is hardly any effect on above position whether you are registred dealer with the department or not.
Dear Sir, we are a partnership firm receiving GTA services & paying service tax on its bill to GTA provider only are we allowed to do that as there is reverse charge in GTA services. thanking you in anticipation Nitin Sharma (Posted On: 01 Feb, 2013)

The reverse charge on GTA is applicable. If a person falls under seven catgories listed in Section 2(1)(d)(iv) then the service tax is payable such person. The partnership firm falls under the same. Hence the service tax is payable by you and not by the transporter. The contractual obligation cannot replace the statutory obligation. Hence the liability to pay tax is on you only. However, we can only plead before the department that the service tax is not payable twice if the service tax is paid by the transporter.
I wanted to know that whether place of provision of service rules apply to reverse charge mechanism too ??? i.e if X is providing export services and takes help of y ( a foreign entity), then will the reverse charge apply to bill of Y to X. And what will happen if X is importing service? (X is a packer mover in both the situation. Jayant (Posted On: 01 Feb, 2013)

Reply:- As per charging section 66B, service tax is leviable on the services provided or to be provided in a taxable territory and Place of provision Rules determines the place where service is provided and deemed to be provided. Further under reverse charge, liability to pay service tax is on service receiver(either wholly or partly) and reverse charge apply only when service tax is leviable i.e. service is provided or to be provided in the taxable territory as determined according to Place of Provision Rules. In the instant case, if place of provision (As per POP Rules) of service received from Y is taxable territory then service tax will be leviable. If service tax will leviable then 100% liability of service tax will be on X as service recipient under reverse charge(Sl. No. 10 of Notification 30/2012-ST). As per Rule 3, generally Place of Provision is the location of service recipient but in case of some specific services it is determined by other specific rules. As you have not mentioned that which service X is receiving from Y therefore it is difficult to say, whether service tax is leviable or not.
We are dealers registered under central excise. The warehouse is very small to accomodate goods such as trailer or concrete mixers. We recently got an order where the customer intends to availed cenvat credit as he is a service provider for leasing construction equipment. Since we do not have the space to keep the goods we intend to keep it at the transporter godown and effect delivery from the transporter godown. Our query is can we avail the cenvat credit without receiving the goods at our warehouse due to space constraint. We will raise the Excise (first stage dealer)invoice from our registered warehouse and clear the goods from the transporter godown. Do we need to seek permission for storing goods at transporter godown Kindly advise Associate (Posted On: 31 Jan, 2013)

As per Central Exccise Rules and rugulations, the goods should be received in dealer's premises and then move along with bill of dealer. The only exception is in case of hazardous oils where the CBEC has issued circular where the goods can move in same vechile from dealer's registered location. This exception is provided due to the fact that the pollution permission is required for the same.
Dear sir, Please explain the procedure for changing the constitution of an assessee being a private limited company which is being incorrectly shown in the service tax department's record as a public limited company. Also, please guide whether any authority in the form of Board resolution of the company is to be sent to the service tax department. Thanks Anubhav Wahee Anubhav Wahee (Posted On: 30 Jan, 2013)

Reply:- As per Rule 5A of Service Tax Rules, 1994 , when there is any change in information furnished by assessee in ST-1, such change shall be intimated in writing to the jurisdiction Assistant/Deputy Commissioner of Central Excise. Further there is no any separate rule in this regard. Therefore, if there is any incorrect information shown in the ST-1, you have to tell in writing to the department about such mistake. Further there is no board resolution required.
dear sir, i our company we have availed cenvat credit on capital goods when we are in central excise later on we have surrender our registration since the exemption limit was increased in the budget. as a result we have reversed the un availed cenvat credit in the books to profit and loss account later on few month after central excise audit came and they have noticed few irregularity in aviling cenvat credit on capital goods and raised demand notice now the query is can we adjust the demand against the unavailed cenvat credit which was revered in the books ? Ganesh (Posted On: 30 Jan, 2013)

As per our opinion, the unutlised balance lying on date of opting out of Cenvat scheme can be utilised for the demand of that period. Even there was a recent case law also on this issue only.
Dear Sir, Attention is drawn on Notification No.'s 24/2007 & 29/2012 Service Tax on Immovable Property.(a) what is the rule of property tax deduction from service tax liability when property tax is paid by landlord. (b)if property tax is paid by tenant. Ali Zain (Posted On: 29 Jan, 2013)

The exemption of service tax will be available to the extent, the amount of property tax paid by the service provider i.e. landlord. In my opinion, if tenant pays property tax directly (if it is allowed) then department may raise objection and exemption from service tax may not be allowed. However exemption will be allowed if the same is paid by landlord even if the same is recovered from the tenant.
Is it mandatory to charge Service Tax from clients after voluntary obtaining Service Tax Number and even turnover is below then the basic exemption limit. Ankit Singh (Posted On: 29 Jan, 2013)

Service tax is to charged only when it is leviable i.e. when value of service provided or to be provided, crosses the basic exemption limit and no any effect of the fact that service tax registration is obtained (before crossing exemption limit). However, if once we have started charging service tax and forgone the basic exemption list then we have to pay service tax on all transactions even in exemption limit. The threshold exemption notification is a optional notification.
Dear Sir, can a consultancy firm who is registered in service tax claim cenvat of excise duty paid on purchase of a machine for service providing purpose. If yes then please send any reference. Saurabh Khandelwal (Posted On: 28 Jan, 2013)

The cenvat credit of capital goods is allowed to a service provider. But one has to check the definition of "capital goods" given under Rule 2 (a) of Cenvat credit Rules to see whether the credit on such machine is allowed. Secondly, it has to be seen that you are not availing any abatement on such service. There is condition in certain abatement items that no cenvat credit of inputs, input service and capital goods should be taken. Since all the details are not provided by you, hence we cannot comment on the same.
Dear Sir, I have following quaries relating to Reverse Charge : (i) a Rent a Cab assesee is providing vehicles to University. is Reverse charge applicable? who is to charge ST and by what Rate? (ii) in my company, contractors are giving composite bills, i.e. "Per MT" and "Man Power Supply" by per Man Days". Quary : is Reverse charge is applicable on PMT (piece Rate?), and in this composit bill, on which portion, we are to deposit ST for Manpower Service? Parmeshwar Rathi (Posted On: 28 Jan, 2013)

(i) If the service provider is individual, firm or LOP and service recipient is service recipient then the reverse charge is applicable.Since these details are not available in query, you can judge from this. (ii) Where the supervision and control of manpower under the contract is with the company then the service tax will be payable on revese charge. This supervision and control is to be judged on the terms and conditions of each and every contract. However, normal inference is that when the rate is charged on piece basis then the control is with contractor. However, when the billing is done on man days basis then the control and supervision is with the company. But we reiterate that it is not applicable in all the situations and it is to be seen on the basis of terms and condition of each contract.
IF GOODS ARE DELIVERED AT VARIOUS GODOWNS IN THE CITY OF SERVICE RECEIVER AND PAYMENT OF FREIGHT IS MADE AT OFFICE,WHICH IS SITUATED AT DIFFERENT PLACE IN THE SAME CITY. ALL ACCOUNTS ARE MAINTAINED AT OFFICE. WHETHER TO GO FOR CENTRALISED REGISTRATION OR ONLY FOR OFFICE FROM WHERE PAYMENT IS MADE FOR SERVICE TAX SHYAM SUNDER (Posted On: 28 Jan, 2013)

Yes you can take centralized registration if centralized billing system or centralized accounting system is maintained in respect of such service (i.e. in respect of GTA service)
Sir, Will funding of an event of education institution amount to sponsorship?Would expenses incurred on the event (appart from sponsorship payment made) be trated as sponsorship? what is the demarkation line between sponsorship and donation. Sweta Kalantri (Posted On: 27 Jan, 2013)

Already answered. Donation means when the organizer (receiver) has no obligation to provide something in return, will not be taxable. But if there is Sponsor Company’s name or logo are displaying in the event or naming the event or giving the booking rights to sponsor or giving any other benefits, then it will be sponsorship service and service tax will apply.
Sir, in case of a construction company we have outsourced work to labour contractors. These contractors enggages their own labour and do the work.but before making the payment to these contractor we do veriy the wrok quality. whether the payment made to contractor will still amount to Manpower supply service or will it be treated as pure labour contract? Sweta Kalantri (Posted On: 27 Jan, 2013)

When the supervision and control of labour is in hands of the service recipient then it will fall undder manpower supply. This has to be judged on the basis of terms and conditions of each agreement. We cannot comment on the basis of information provided in the query. Secondly, whether a contract falls under works contract or pure labour contract, will depend on the fact that contract is along with material or not. If the material is inculded then it will be works contact. But if the material is not included then it will be termed as pure labour contract.
Sir, i need information about excise exemption for dairy equipments . SUPRIYA (Posted On: 27 Jan, 2013)

Your query is not complete. Please give the detail of product i.e. product name and tariff head.
DEAR SIR WE ARE A PROPRIETORY CONCERN MFG.AND EXPORTING GEOMETRY BOXES/ MATHEMATICAL INSTRUMENT BOXES, WITH TOTAL TURNOVER WELL BELOW 1.5.CRORE, HAVING TAKEN C.E.RGISTRATION ON 4.10.11,FOR MFG. BRANDED GOODS,DUTIABLE ON 1%/2%,WITHOUT CENVAT CREDIT(01/2011),WE TOOK LUT ON 19.10.11,PERSUMING THAT IT IS FOREVER AND DOE NOT REQUIRE REVALIDATION, AND EXPORTED UNBRANDED GOODS ON 08.12.12,UNDER ARE-1/LUT, WHEREIN WE HAVE BEEN SHOWCAUSED BY THE RANGE, DEMANDING PAYMENT OF DUTY (11A),INTEREST(11AB),PENALTY(11AC)& PP(RULE26),DUE TO EXPORT UNDER EXPIRED LUT,HEREIN IN DEFERENCE TO THE SCN WE HAVE IMMEDIATELY DEPOSITED DUTY+INTREST(REFUNDABLE)AND PROOF OF EXPORTS ALSO, BUT IN OUR OPINION,SCN IS NOT SUSTAINABLE,BECAUSE THE ISSUE OF EXPIRED LUT IS REDUNDANT SINCE GOODS HAVE BEEN EXPORTED AND THE PROOF OF EXPORTS SUBMITTED,NO DUTY IS CHARGABLE SINCE OUR TOTAL TUROVER IS WELL BELOW 1.5 CRORE,SCN BEING NOT SUSTAINABLE PENALTY UNDER 11AC AND PP UNDER RULE 26 ALSO SHOULD BE DROPPED AND FUTHER WE BEING PROPRIETORY CONCERN RULE 26 IS NOT INVOKABLE, KINDLY ADVISE YOUR VALUABLE OPINION. V K GUPTA (Posted On: 27 Jan, 2013)

When the export has taken place then there is need of demand only on the ground that the undertaking has expired. Moreover, the units operating under SSI exemption can follow the simplified export procedure also. Further, your agrument is totally right that if the department says that the goods are not exported then it will be included in aggregate value of clearacnes. The duty cannot be demanded in that case also.
A is providing engineering consultancy to B,a company in USA and earns foreign exchange.Export of service and no ST hopefully. Now if A also uses the services of C,a NRI in USA, to assist him in his engineering studies for B and pays him in foreign exchange does the fee attract ST on reverse charge basis? If C provides service to B directly and takes payment from A will that make a difference? All engg services are related to export only no conaumption in India. vis (Posted On: 27 Jan, 2013)

As per Rule 3 of Place of Provision Rules, generally place of provision shall be the location of service receiver. If C (outside India) is providing services to A then place of provision is the location of service receiver located in India i.e. taxable territory and as per charging section 66B, service tax is leviable on services provided in Taxable territory therefore service tax will be leviable. In such case, A will be liable for payment of service tax as per Section 68(2) because service provider is located outside India. If C provides services directly to B company then service is provided outside taxable territory(India) and in such case service tax will not be leviable.
Sir, Agricultural Produce market committee providing their shops/Godowns on rent to the traders / licencee and rent is chargeable to Service Tax. However, Traders/licencee, before taking shop or godowns on rent paid non-refundable deposit to the APMC. Whether this non-refundable deposit is chargeable to Service Tax? CA. Jaydeep Mehta (Posted On: 25 Jan, 2013)

If the security deposit is refundable then it will not be charged to service tax unless and until it is proved that it has influenced the rent. However, in our opinion, the non refundable deposit is a part and parcel of rent only and hence liable to service tax.
Sir, we have imported material from Australia through Air Cargo & the freight charges were borne by our Custom House Agent, who later charged it to us. Are we liable to pay Service Tax under GTA on this freight? Preeti Kalled (Posted On: 25 Jan, 2013)

According to Section 66B “Service tax will be leviable on all services provided in the taxable territory by a person to another for a consideration other than the services specified in the negative list”. Clause (p) of Negative List given u/s 66D exempts “services by way of transportation of goods by an aircraft or a vessel from a place outside India upto the custom station of clearance in India”. So service tax is not leviable on such service.
can we liable to pay service tax forklift use for unloading material. MAHESH (Posted On: 25 Jan, 2013)

Yes service tax will be liable, as it is neither covered under negative list nor under mega exemption notification. However loading and unloading of agricultural produce is not leviable to service tax as covered under negative list.
valuation of parts and accesories imported without payment of duty by EOU and cleared along with final product i.e. Tug in DTA AMIT KUMAR (Posted On: 25 Jan, 2013)

Your query is not clear. Please elaborate.
Dear Sir, I have a manpower service provider who has paid interest free loan to his staff operating at our location. He is recovering the loan amount in interest free EMI's from his staff's salary. At the same time he is charging Service Tax on the loan amount also when he submits the monthly invoice to us. Can you throw some light as to the applicability of STax on the loan amount. Pls. opine. GANESHKUMAR GK (Posted On: 24 Jan, 2013)

Your query is not understandable. If the manpower supply agency is recovering loan from his staff then how he is charging service tax from you. He will issue a bill to you for amount charged and service tax thereon. The recovery of loan has nothing to do with service recipient.
Dear Sir, As we know that reverse charge is not applicable if services are provided by a company or a body corporate to another body corporate. But if a company which is service provider charge only his part of service tax on invoice then what is liability of service tax receiver company. Whether he has to pay service tax only charge on invoice or whether there is a liability of remaining part of service tax payable to service tax department. For Example: There are two companies ABC Ltd (Security Service Provider) and XYZ Ltd. (Service Receiver). ABC Ltd. issue a invoice to XYZ Ltd. as follows: Services Charges 1000.00 Service Tax 3.09 % 30.90 Total Amount of Bill 1030.90 Now question is , whether XYZ LTD. is liable to pay only Rs. 30.90/- to ABC Ltd. or he has to pay remaining Rs. 92.70 (123.60-30.90) directly to Government. CA. Vipin Saini (Posted On: 24 Jan, 2013)

If reverse charge is not applicable when company is provider of service (as you also saying) then 100% liability will be on service provider. We are failed to understand why the provider company has charge part of the service tax only? The complete service tax is payable by provider company only and he will charge the complete service tax from buyer. If the service provider company is charging part of the service tax only then department will pursue him only for payment of full service tax. And service receiver can’t be liable for default by service provider.
Will servicing charges paid for servicing of vehicle be treated as works contract service? please note labour amt is separately mentioned in the bill. Sweta Kalantri (Posted On: 23 Jan, 2013)

Work contract means supply of material involved for execution of contract of installation, completion, fitting out, repair, maintenance etc (section 65B). The service is still work contract service even if labour and material amount is shown separately. Further as per Notification 30/2012-ST, in case of work contract service reverse charge shall applicable if service provider (i.e. contractor) is individual, HUF, partnership firm and service receiver is body corporate. So in the instant case if service is covered under the above definition of work contract and service is provided by individual, HUF or partnership firm and received by body corporate then reverse charge will apply and 50% liability will be on service receiver.
Donation made to events have the possibility of attracting reverse charge as sponsorship services - will have to confirm whether benefits received by the company or not.If received then service tax will apply plz confirm! Sweta Kalantri (Posted On: 23 Jan, 2013)

W.e.f. 01.07.2012, the ‘sponsorship’ has not been defined therefore we have to understand it on the basis of definition as given prior to 01.07.2012. The amount paid in form of donation to organizer when the organizer has no obligation to provide something in return, will not be taxable. But if there is Sponsor Company’s name or logo are displaying in the event or naming the event or giving the booking rights to sponsor or giving any other benefits, then it will be sponsorship service and service tax will apply.
what confirmation can i seek from the builder that he has paid the service tax to the government on my flat sudhir kaup (Posted On: 22 Jan, 2013)

There is no need of confirmation for service receiver that service provider has deposited the service tax to government. If he charges service tax from and does not pay to the Government then he will be liable for the consequences. The department will come to you for demand of service tax. However you can confirm it by checking service tax deposition challan and service tax records of service provider.
sir, can we claim CENVAT inputs on services before the date of ser tax registration as a service provider who is a builder: who receives the advances from buyers even before the ser tax registration J RANGANADHAM (Posted On: 22 Jan, 2013)

There is no provision available under the CENVAT Credit Rules to disallow such credit. In the case of IMAGINATION TECHNOLOGIES INDIA P. LTD. vs. COMMR. OF C. EX., PUNE-III, reported at 2011 (23) S.T.R. 661 (Tri. – Mumbai), that CENVAT Credit cannot be denied for the period prior to registration by an assessee. So Cenvat credit cannot be denied only on the ground that it relates to a period prior to registration subject to fulfillment of other terms and conditions of Cenvat Credit Rules. But the department will not accept this position and dispute may arise.
One of my client is practicing in Yoga. He receives fees either on a monthly basis or per lesson given to the candidate. He holds a Yoga's certificate issued by Iyengar Institute, Pune. Whether the fees received for services rendered would stand exempt as per Mega Notificiation No. 25/2012 of Service Tax. Kindly advice based on the definition given in the above notification, Your direction will enable us take a suitable action CAQ GANDHI KISHOREKUMAR D (Posted On: 21 Jan, 2013)

As per Sl. No. 2 of Notification 25/2012-ST, Health care services by a clinical establishment, an authorised medical practitioner or para-medics are exempt. Further as per definition given in the Notification 25/2012-ST, “(t) health care services includes any service by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any ‘Recognised System’ of medicines in India” ‘Recognized System of Medicines in India means Yoga, Naturopathy, Ayurveda etc. So, conclusion is that if we can prove that the yoga services by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy then it will be exempt under sl. No. 2 of Notification 25/2012-ST. But the department will not accept the aforesaid position.
Dear Sir, my client have arrangement with foreign customer that all warranty services for Indian customer is to be provide free of cost in india but bill for the same is raised to foreign customer in foreign currency. Whether service tax is payable by my client or not? If payable then whether any provision to take refund for the same by Indian party of foreign party? Prabhash Kumar (Posted On: 21 Jan, 2013)

Reply:- Your query is not clearly understandable, our understanding of the query as “an indian assessee is providing services in India on behalf of Foreign customer” and our answer is on that understanding. As per Rule 9 of Place of Provision, The place of provision of ‘intermediately services’ shall be the location of the service provider. As per rule 2(f) of these rules “intermediary” means a broker, an agent or any other person, by whatever name called, who arranges or facilitates a provision of a service (hereinafter called the ‘main’ service) between two or more persons, but does not include a person who provides the main service on his account. As in your case, Indian assessee is also providing intermediately service, therefore, the place Your query is not clearly understandable, our understanding of the query as “an indian assessee is providing services in India on behalf of Foreign customer” and our answer is on that understanding. As per Rule 9 of Place of Provision, The place of provision of ‘intermediately services’ shall be the location of the service provider. As per rule 2(f) of these rules “intermediary” means a broker, an agent or any other person, by whatever name called, who arranges or facilitates a provision of a service (hereinafter called the ‘main’ service) between two or more persons, but does not include a person who provides the main service on his account. As in your case, Indian assessee is also providing intermediately service, therefore, the of provision is in your case is the location of service provider i.e. India. Hence, the service is not treated as export of service and service tax will be leviable. The service tax will be payable by service provider (even if service is covered under reverse charge because service receiver is located outside India) and assessee can’t take refund of the same.
Dear Sir.., We have local purchase of "IBM Storage manager with annual software renewal" they charged double tax ( i.e.1)Vat on Net Amount & 2) Service on Net Amount)..,now my query is they wroghly chareged double tax calculation. As per my self ( Net Amt + Service Tax = total on Vat Calculate ) . can you please reply to me which is correct in double tax code calculation. Vivek Mudaliyar (Posted On: 19 Jan, 2013)

Your query is not clear therefore we can reply the same. However, the dispute is going in hotel industry also as to whether charge service tax on Vat amount also in case of Mandap keeper service.
dear sir, we got show cause notice for non filling excise returns on time is there any rule to escape form this penalty Umesh Bora (Posted On: 19 Jan, 2013)

No there is no any remedy for escaping penalty of non-filling of return. However, it is discretion of adjudication authority to impose penalty. If you are able to prove your bonafide then he may waive the penalty.
Sir, We have constructed a new hotel and launched it in January 2013. From 1-4-11 to January 2013, we have incurred service tax on professional fees, transportation, forex, hotel charges, etc. during the course of construction. Can we claim credit of these service tax payments against our future service tax payments arising through hotel renting, mandap services, restaurant service, etc. Thank you. Sethupaty (Posted On: 19 Jan, 2013)

Reply:- For taking Cenvat Credit, we have to see the definition of input service as given in the Rule 2(l) of Cenvat Credit Rules, 2004. As per this definition, input service means any service used whether directly or indirectly for providing output service. Therefore in my opinion credit will be allowed but the department may raise the objection and then you will have to prove that these input services are used for providing output service of Hotel Renting, restaurant service etc. The definition of input service clearly excludes the services relating to civil construction. However, if the credit is allowed then there will be dispute that the credit is not allowed in the period when you were not registered. There are certain case laws which says that the credit will be allowed even if the assessee is not registered because he will take registration when he starts paying tax.
whether circular no 967/01/2013-cx dated 01/01/2013 is applicable for excise matters only or service tax /custom matters area also covered please clarify Thanks in advance sanjay jain (Posted On: 19 Jan, 2013)

In our opinion, the circular is applicable only to excise matters only. But the department has issued letters in service tax matters also.
whether flavored milk will be treated as milk exempt from services under GTA services. Ankur Agarwal (Posted On: 19 Jan, 2013)

Sl. No. 21(a) of Notification No. 25/2012-ST grants full exemption from service tax to “transport of fruits, vegetables, egg., milk, food grain and pulses by road”. The word ‘milk’ is not clarified under the Law therefore it is the point of interpretation of intention of exemption. In my opinion exemption will not be allowed in case of Flavored Milk because the intention of exemption is to grant relaxation for raw articles of daily necessity and not the items commercially produced. The same has also held in case of Agro Dutch Industries v. CCE [2011] 32 STT 285/12(New Delhi CESTAT) it was held that commercially processed and canned mushrooms could not be brought under “vegetables” and exemption is also not allowed.
When output service on which service tax was discharged by the assessee held to be a exempted service in that case cenvat credit taken on input service can be denied? Whether there is any case law in assessee favour on said point? MANISH VORA (Posted On: 19 Jan, 2013)

Reply:- As per Rule 6(1) of Cenvat Credit Rules, 2004, “the Cenvat credit shall not allowed on such quantity of input service used for provision of exempted service”. When credit is not allowed then question of credit taken and denied? However, there are certain case laws which says that when the duty paid by assessee is accepted by the department then the input credit will also be allowed. But litigation is bound to happen.
sir, our company is fertiliser manufacturer and engaged various contractors on piece rate basis, i.e. for various activities like packing, shifting, loading unloading, on per MT basis.(all work performed by labours of contractor) My quary is whether these contractors are covered under manpower supply service(for reverse charge purpose) of job work (BAS)? further being the excisable product "Fertiliser" my company is paying appropriate excise duty as principle manufacturer, so WHETHER ST is exempted under Notification 25/2012 under serial no 30(C) ? job work is performed within the factory, not outside. pls advise. thanks and regards,(Parmeshwar Rathi) Parmeshwar Rathi (Posted On: 18 Jan, 2013)

Firstly the exemption of Sl. No. 30(C) is available only in respect of packing activity because shifting and loading-unloading is not an intermediate production process. Shifting and loading-unloading activity given on contract basis is not covered under manpower supply service. The essential character of manpower supply service is that the manpower should work under the superintendence or control of service receiver and consideration should be paid on the basis of no. of labour supplied. In the instant case shifting and loading-unloading work is given on contract basis and consideration is paid on the basis of quantum of work not on the basis of labour supplied.
sir please clarify me on the following situation:- in case of a pure labour contract, where the manpower works under the control of contractor and not under principal employer, are chargeable under which head of taxable service Rakesh (Posted On: 18 Jan, 2013)

After introduction of negative list concept, importance of classification of services are limited in some areas e.g. reverse charge, exemption etc and every service is not defined separately. As the contract is pure labour contract, the reverse charge will not be applicable. However, classification has been reintroduced by recent circular number 165/16/2012 by CBEC only for the purpose of payment only. The CBEC has introduced old list of 120 services for the purpose of payment by different accounting codes and if any service is not covered under list of 120 services then the payment of this type of service will be done under head “Service Not in Negative List”.
I have a coaching classes for which i have taken a single premises regn. number. I have different branches in mumbai but all accounting, depositing of fess, payment to vendors and service tax is done centralised. The cenvat credit for bills raised by vendors are for different branches. The Service tax supdt says it cannot be set off and now u have to pay those amounts for cenvat credit again with interest. It is just the regn number is for single premises and not centralised. Is he correct in his view. what can be the best option for me Naresh (Posted On: 18 Jan, 2013)

It seems that the department ‘s view is correct in the instant case and you have to reverse the Cenvat credit. You have to apply for Centralized Registration. In our opinion, after the centralized registration you can take this credit.
Dear Sir, One of my client is providing the service of " selecting candidates" for the company in UAE. He is conducting interview, spending on medical checkup, spending on lodging boarding, hireing place for interview etc. All the bills for sending are in the name of my client. All his spending is reimbursed by his overseas company. He is also getting x% of the reimbursable amount. Wether he should charge service tax on reimbursement and his commission or both? Can he raise debit notes for reimbursement and inovice for his commission. His invoice and payment both are in INR. Sir thank you very much for your early response. hetal (Posted On: 17 Jan, 2013)

The service mentioned in the query not satisfies the conditions as mentioned in the Rule 6A of Service Tax Rules. Therefore it is not treated as export of service. Further in our opinion service tax will be levied on total amount (i.e. Commission + Reimbursement) because expenses incurred during the course of providing service are also includible in taxable value and here the conditions of pure agent is also not satisfied.
What is the treatment of service tax on forfeited amount of refundable security against rent before 01.07.2012 and after 01.07.2012? Navin Jain (Posted On: 17 Jan, 2013)

You have not clarified that what is the reason for which security deposit has been forfeited. Before 01.07.2012:- If the forfeiture is due to non-payment of service charges or it is agreed by both parties that security deposit will be adjusted as service i.e. it is in nature of service charges then service tax will be levied. After 01.07.2012:--Service tax will be levied unless such forfeiture is in nature of reimbursement of any loss e.g. damage of asset, asset misplaced etc.
Sir, If we have paid service tax liability as per reverse charge mechanism in Mar'12 under Business Auxullery services. But this transaction not reported in ST-3 for the period Oct'11 to Mar'12. Now 90 days period for filing revised return is lapsed. In service tax audit, department has asked to pay amount for non filing of return. In fact we have filed NIL return for Business Auxullery services for the mentioned period. It is a case of careless ness in filing of return. Is department’s stand is correct ? we have paid all liability in time but not reported to ST-3. Please guide. Sachin Pawar (Posted On: 16 Jan, 2013)

As you are saying that you have correctly discharged your liability and return is also filled timely and only mistake is that you have forgotten to mention the details of reverse charge liability in the ST-3. In that case no any penalty is leviable and further there are many cases decided in favour of assessee in which technical lapses are condoned. Moreover, there is no revenue loss to the government and penalty can be waived as is being waived in case of non filing of nil returns.
sir in of my client who is service provider.Incurred hotel bill for the purpose of business only.But the hotel is issued the bill like "taxes" instead of service tax and also service tax number was not mentioned on the bill can we take input on that bill thankyou sir kishore (Posted On: 16 Jan, 2013)

If such tax is service tax and used in providing of output service or in manufacturing of final product then it will be allowed [Rule 2(l) of CCR 2004]. However department will definitely raise objections as most of the particulars that are required for taking credit on the basis of an invoice under Rule 4A of Service Tax Rules have not been mentioned. It might be difficult to justify the credit taken as service tax registration no. is also not mentioned, but there are many cases in which it has been held that Cenvat can’t be denied only on account of technical lapses.
We start production of inline drip irrigation systems from this year. I want to know DIS is exempt form excise duty, if yes under which notification kailas (Posted On: 16 Jan, 2013)

The tariff rate for drip irrigation system (84248100) is Nil. As the tariff rate itself is nil, hence it need not to be covered under any exemption notification.
How do we take cerdit of service tax on bank charges?In the bank statement it shows inclusive of service tax. RAJIV JAIN (Posted On: 15 Jan, 2013)

As per proviso to Section 4A, in case of service provider is bank invoice may not include serial no. and address of service receiver but it should contain the its name, address and registration no., description and value of service and service tax payable. Therefore credit will not be allowed if service tax registration no. and service tax is not mentioned in the document.
Sir,we have availed cenvat credit on capital goods.(on Electric panel) After three year during short circuit Electric panel has burnt out in fire incidence. does we have to required reversal of cenvat credit or not ? Rajat Jain rajat22jain@gmail.com Rajat jain (Posted On: 15 Jan, 2013)

In the case of CCE v. Tata Advanced Materials Ltd has addressed the issue of reversal of the CENVAT credit on the capital goods that were destroyed in fire. The Karnataka High Court has held that there is no provision, in law that provides for reversal of the credit, except when the credit has been illegally or irregularly availed of. So you are not required to reverse Cenvat Credit.
Sir, Want to know whether it is mandaoty on the servie provider's part to mention the PAN number,Service tax number &service tax Category in the invoice which he raises to clients to whom he provides various services Srinath (Posted On: 15 Jan, 2013)

As per Rule 4A of Service Tax Rules, 1994 “every assessee providing taxable service shall issue a bill, invoice or challan signed by such person or a person authorised by him in respect of such taxable service and such bill, invoice or challan shall be serially numbered and shall contain the following namely:- 1. The name, address and registration no. of such person 2. The name and address of the person receiving such service 3. Description and value of taxable service 4.The service tax payable thereon” Therefore it is mandatory to mentioned service tax registration no. and category of service.
dear sir , my client is builder and he is taking services of contractor which is a pure labour contract . so it will not fall under neither work contract nor supply of manpower services . so sir please tell me under which head of services it will fall KISHOR (Posted On: 15 Jan, 2013)

After introduction of negative list concept, importance of classification of services are limited in some areas e.g. reverse charge, exemption etc. However, it has taken importance on reintroduction of classification by recent circular number 165/16/2012 by CBEC. As the contract is pure labour contract, the reverse charge will not be applicable.
as per rule 3 of deciding place of prov. of service does that applicable for goods. commission for goods sale how to decide exported or not? bharat (Posted On: 15 Jan, 2013)

The place of provision of service in respect of intermediary who causes sale or purchase of goods or arranges goods will be determined as per General Rule 3 because any of the specific provisions mentioned in the Rule 4 to 12 is not applicable in this case. As per Rule 3, place of provision shall be location of service receiver. E.g. if a person procures order for supply of goods from person located in Mumbai and sends order to company in Germany, the service receiver is the person located in Germany and place of provision will be Germany. For export of service, conditions in Rule 6A have to be seen. One of the important condition in that Rule is that the payment should be received in foreign convertible currency.
can we claim cenvat credit of excise duty charged on machine repairs and maintenance chinna (Posted On: 15 Jan, 2013)

Yes, credit is allowed if it is our capital goods.
Hello Pradip Sir, In one of the bill 50% advance payment made before service started & 50%aftewords,then at the time of availing CENVAT can we take Service Tax on full amount. Thanks & I am eagerly waiting your answer Shilpa Shirke (Posted On: 15 Jan, 2013)

Firstly your query is not clear. As per Rule 4(7) of Cenvat Credit, Rules 2004, “the Cenvat Credit in respect of input service shall be allowed on or after the day on which the invoice, bill or challan as the case may, is received” So you can take credit after receiving invoice, bill or challan. But the payment is to be made within three months of issue of invoice
What is the rate of abatement in respect of works contract service if asseessee is engaged in the construction of residential complexes? And whether asseessee can take CENVAT if he claims abatement? Jenil Shah (Posted On: 15 Jan, 2013)

Your query does not provide complete details i.e. whether construction is a type of work contract or it is intended for sale. Therefore we are answering you for both types of constructions:- 1. Construction of a complex, building, civil structure or a part thereof, intended for a sale to a buyer, wholly or partly except where entire consideration is received after issuance of completion certificate by the competent authority – Service tax will be leviable on 25% of Value i.e. 75% abatement and Cenvat credit of inputs is not allowable see notification 26/2012-ST at http://www.new.capradeepjain.com/redirect_amdview_5958_3. This means credit on input service and capital goods will be allowed. 2. In case of work contract for execution of original works then one has to segregate the value of material and labour part. The service tax will be payable on labour part. If the service portion cannot be segregated then service tax shall be payable on 40 of the total amount charged for the works contract. The cenvat credit on inputs shall not allowed. See valuation rules and Notification 24/2012-ST at http://www.new.capradeepjain.com/redirect_amdview_5924_3. This means that the credit on capital goods and input service will be allowed. 3. In case of finishing work, again segregation of material and labour is to be done and the service tax will be paid on labour part. But if the same cannot be done, then service tax is payable on 60% of total amount charged. The cenvat credit on input service and capital goods will be allowed.
Sir please clarify on the following situation. 1. Sale consideration of residential flats for FY 2012-13 Rs. 42,42,000, after abatement i.e 25% value Rs. 1060500, this is my first year of operations can i claim SSP exemption under Notification No. 33/2012 and pay service tax on 60500 ? anil kumar (Posted On: 15 Jan, 2013)

As per SSP exemption Notification 33/2012-CE, “the threshold exemption (Small Service Provider Scheme) exemption of not exceeding Rs. 10 lacks of aggregate value of service provided is allowed if the aggregate value of taxable services rendered by a provider of taxable service from one or more premises, does not exceed ten lakhs rupees in the preceding financial year”. Since your aggregate value of clearances for last year is nil ( as told in query) then you are eligible for this exemption. Further as per explanation given with this Notification, “(B) aggregate value means the sum total of value of taxable services charged in the first consecutive invoices issued during a financial year but does not include value charged in invoices issued towards such services which are exempt from whole of service tax leviable thereon under section 66B of the said Finance Act under any other notification.” Hence, your first value of Rs. 10 Lakh will be exempted. But there is a dispute i.e. whether sale value of Rs, 42,42,000/- or abated value of Rs. 10,60,500/- will be considered. There are different opinions about the same. But on safer side, we suggest that that the value of Rs, 42,42,000/- should be considered
One of the employee in the company takes his salary in the form of consultancy charges.Last year his salary was below 9 lacs but during the year in January there was a hike in his pay and accordingly it will cross 10 lacs. So he is liable to Service Tax but the query is whether service tax has to be paid retrospectively or prospectively i.e. after increment? Vinay Jhawar (Posted On: 15 Jan, 2013)

Service tax is not applicable when the services are provided by an employee to the employer in the course of or in relation to his employment (exclusion clause of definition of service). But in the instant case salary is taken in form of consultancy charges therefore Service tax will be leviable on it. Further in last year the value of service provided is less than 10 Lakhs therefore SSP exemption is allowed in current year also upto Rs. 10 Lakhs and service tax is leviable on amount in excess of Rs. 10 Lakhs.
A Two weeler dealer who trades in vehicle as well as servicing for the same nad pay service on servicing part. how can dealer take input credit on input service received ? Nilesh Pitliya (Posted On: 14 Jan, 2013)

In the instant case there are two types of services are providing by the dealer the first one is taxable (i.e. servicing of vehicles) and the second one is exempted service (trading activity). For Cenvat in such case when taxable as well as exempted service is provided, Rule 6(3) of Cenvat Credit Rules 2004 should be followed. As per this Rule 6(3), when a service provider provides taxable as well exempted services and receives common input services then he shall follow any one of following options:- 1. Maintain separate records for receipt and use of input services used in taxable service and in exempted service and take credit of services used for providing taxable service only. 2. Take credit of all input services Pay an amount equal to 6% of value of exempted service. 3. Take credit of all input services and make proportionate reversal as determine under sub-rule (3A) of Rule 6.
Plz guide on the applicability for issuance of C-Form for interstate job work (coloring process), %age of material portion for Sales Tax purpose in Maharashrtra & %age for service tax applicability on the same (material is to be moved for job work from Himachal to Maharashtra ) Renu Arora (Posted On: 11 Jan, 2013)

We donot deal in VAT matters. Hence, we will not able to solve your VAT query. However, for service tax purpose, we require some more details to see whether the process undertaken by you amounts to manufacture or not. Please provide the detailed procedure undertaken by you as well as material used.
sir,in the case of builders cum flat promotoers the exemption from service tax for residential projects of not more than 12 residential units or independant houses meant for sale is available after 1st july 2012 need clarification j ranganadham (Posted On: 10 Jan, 2013)

As per Sl. No. 14(b) of mega exemption Notification 25/2012-ST, “Services by way of construction, erection, commissioning, or installation of original works pertaining to a single residential unit otherwise than as a part of a residential complex” is exempt. No exemption such as residential project upto 12 residential units is available now which was available earlier. The exemption is available only for a single residential unit.
Is there any penalty for Late filing of EXP 2 return? shayan (Posted On: 09 Jan, 2013)

As per proviso of Notification 31/2012-ST, “(c) the exporter availing the exemption shall file the return in Form EXP2, every six months of the financial year, within fifteen days of the completion of the said six months” The above provision makes it mandatory to file EXP-2 within time period and not clarify about non-filing or late filing. Therefore, it means if EXP-2 is not filed within time period then exemption will not be allowed. However there are many case laws which allow benefit to assessee even if there are procedural lapse by the assessee.
hlo sr. my brother is contracor and installing sub stations, transformers under sub contractor of nbcc. since nbcc is exempted from s.tax, same vl be applicable to sub contractor sunil mehla (Posted On: 09 Jan, 2013)

As per sl. No. 29(h) of mega exemption notification 25/2012-ST following service is exempt:- “(h) sub-contractor providing services by way of works contract to another contractor providing works contract services which are exempt” Hence, if the main contractor providing the services of works contract is exempt then the subcontractor also providing services of works contract will also be exempt so service tax will be exempt in the instant case.
Dear Sir, the person is doing the work of clearing of containers of import and export. My question is he doesnt hold the license of CHA and he take the CHA licence on rent. So while filing ST-1 for registration under which service he need to be categorised . ANIT AGGARWAL (Posted On: 07 Jan, 2013)

You have to registered under category of CHA service because under negative list concept, each service not defined separately and only some services are defined. CHA service is also not defined and earlier definition is not applicable now. However, recent circular has reintroduced classification. Therefore it will be appropriate to take registration under CHA under the instant case.
Dear sir, please explain the procedure for amending the ST-2 online for the purpose of adding new services. Also,please clarify if any physical documents are required to be submitted in the department's office after online amending the ST-2. Anubhav Wahee Anubhav Wahee (Posted On: 07 Jan, 2013)

Firstly you have to add new service online on ACES system. Thereafter, you have to give revised ST-1 application along with old original registration certificate in form ST-2 to the department.
We are in hotel business with certain brand, it is some time required to sent our personnel to different cities where same brand is operating to impart training. as a normal course invoice with service tax will be raised for the duration he will be there. pls advice whether is will be covered under manpower service and whether we can adjust the output laibilty against input. SAMIR AGARWAL (Posted On: 02 Jan, 2013)

Rule 2(g) of Service Tax Rule, 1944 defines supply of manpower to means:- “supply of manpower temporarily or otherwise to another person under his superintendence or control” So the essential character of manpower supply service is that the manpower should work under the superintendence or control of service receiver. So if your employees work under control of service receiver then it is manpower supply and such case reverse charge will be apply. Further as per Explanation given with Rule 3(4) of Cenvat Credit Rules, “Cenvat Credit cannot be used for payment of service tax in respect of services where the person liable to pay tax is the service recipient”. So you can’t use Cenvat credit for payment of service tax under reverse charge. However Cenvat credit can be used for payment of liability of an output service.
sir can we take credit of service tax paid to caterers on occasion of opening of booking of flats in case we are providing output service of builders kalpesh (Posted On: 31 Dec, 2012)

As per Rule 2(l) of Cenvat Credit Rules, 2004 input service" means “any service, used by a provider of taxable service for providing an output service but excludes services such as those provided in relation to Outdoor Catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits extended to employees on vacation such as Leave or Home Travel Concession, when such services are used primarily for personal use or consumption of any employee” In instant case catering service is received on occasion of opening of booking of flats therefore credit is allowed but if catering service is received primarily for consumption of employee then it will not be allowed.
Raw Material is supplied to us on excisable challan 4(5)(a) for doing the machining work as per there drawings. Please confirm the service tax applicability? sandip (Posted On: 29 Dec, 2012)

Your query is not clear that what type of job work are doing on machinery i.e. the activity is amount to manufacture or not? Therefore service tax is applicable if the activity is not amount to manufacture. However, since you have received the material under 4(5)(a) challan then the material will be used by supplier in manufacture of final product and it will be removed after payment of duty. If this is the position then there is no need to pay the service tax.
dear sir , if the service provider give service of maint & rep.of railways,wagon,tracks to its client public sector company the it would exempted or taxable . pls clarify a b mohan (Posted On: 28 Dec, 2012)

Under new concept of negative list, service tax will be leviable when an activity is covered under definition of ‘service’ and not covered under the negative list and mega exemption notification. ‘Service’ has been defined in clause (44) of the new section 65B and means – “any activity carried out by a person for another for consideration and includes a declared service.” Hence the above mentioned activity in query covers under the definition of Service. Further your activity is neither covered under Negative list nor under Mega exemption Notification 25/2012-ST therefore service tax will be leviable. However entry no. 14 of mega exemption notification specifies “(a) Services by way of construction, erection, commissioning, or installation of original works pertaining to an airport, port or railways, including monorail or metro” as exempt but this entry is not applicable in the instant case as in instant case there is an activity of repair and maintenance and not an activity of i.e. erection, commissioning or installation of original work.
duty is paid after audit objection but before SCN. Question : can assessee availe cenavt credit on duty paid? (for example duty paid for GTA expenses and Cenavt is elegible under inpuyt service) hemant (Posted On: 27 Dec, 2012)

Cenvat credit of service tax paid on services is available if it is covered under the definition of input service as defined in Rule 2(l) of Cenvat Credit Rules, 2004 i.e. eligible for input credit. There is no effect of the fact that duty is paid after audit objection or after issue of invoice.
Dear Sir, In Apr'11 to Sept'11 half yearly return we had taken CENVAT credit but we forgot to mention the same in the return and uploaded by mistake. Now we have received a show cause notice to pay the differential amount. Now we can't even revise the return as the time limit is over. Kindly advise. Megha (Posted On: 26 Dec, 2012)

As per Rule 7B, revised return can be filled within a period of ninety days from the date of submission of return under Rule 7 to correct a mistake or omission. Therefore you can’t file the revised return and you have to reply the SCN that you are not liable to pay the differential amount because there had been a omission in filling ST-3 and you have not shown the Cenvat Credit amount.
If GTA recovers octroi ,loading and unloading charges in the freight challan i.e. consigment note them what will be service tax liability whether all has to be included? Vinay Jhawar (Posted On: 26 Dec, 2012)

Service tax liability will be on gross amount charged in consignment note i.e. if Octroi, loading and unloading etc. are included in consignment note then service tax will also be leviable on these recoveries.
Sir, What is the service tax liability on sub-contractor (prop. firm)doing shuttering work on labour rate(without material) for a contractor(pvt. ltd. co.) and when service tax introduce on sub-contractor dinesh negi (Posted On: 26 Dec, 2012)

With effect from 01.07.2012, Service tax will be leviable on all services provided in the taxable territory by a person to another for a consideration other than the services specified in the negative list or otherwise exempted. The service as mentioned in the query is not covered in negative list nor under mega exemption notification 25/2012-ST. Therefore it will be leviable to service tax. Further there is a threshold exemption (Small Service Provider Scheme) in service tax under which assessee is eligible for exemption upto Rs. 10 lacks of value of service provided. The basic condition for claiming this threshold exemption is that “the aggregate value of taxable services rendered by a provider of taxable service from one or more premises, does not exceed ten lakhs rupees in the preceding financial year”. If you are eligible to claim this exemption with all other terms and conditions then you can claim the same. Further, the reverse charge will not be applicable as it is pure labour contract and the material is supplied by main contractor. Hence, the complete service tax liability, if any, will be on sub-contractor only.
Sir,wanted to know do we have to pay service tax in reverse charge in cash ,if yes why govt. is demanding it in cash & can we claim credit of such reverse charge service tax paid. NITIN SHARMA (Posted On: 26 Dec, 2012)

You can’t pay this service tax liability by utilizing Cenvat credit because as per Explanation given with Rule 3(4) of Cenvat Credit Rules, “Cenvat Credit cannot be used for payment of service tax in respect of services where the person liable to pay tax is the service recipient”. Further Cenvat credit is available on these services if these services are covered under the definition of Input Service as given under Rule 2(l). So if the services are covered under the above definition then credit is allowed to you.
Sir iam having a client who are co-owners of a commercial property. the rental income of the property exceeds Rs.10Lakhs in aggregate, but individual share in the property is below the thresh hold limit. the co-owners are having undivided share in the property and are entering into lease agreements with tenants jointly.the rental cheques are isuued by the tenants in the individual names of co-owners. we had applied for service tax registration in the individual names of coowners mentioning the same building adress, since the tenants were willing to pay ST. the depatment rejected the application stating that only one registration can be given for one building. i would like to know the positionin this regard. i also requets you to suggest the forum within the department to whom i should raise this issue. sajusreedhar (Posted On: 25 Dec, 2012)

In our opinion, each co- owner is eligible for separate exemption of Rs. 10 Lakhs. As you are saying that building (co-ownership) is rented then registration can’t be taken on this premises. Further the registration should be apply separately in individual names.
Does the amount reimbursed by the service receiver should also be calculated in total amount to charge Vat i maharashtra? Saurabh Bothra (Posted On: 25 Dec, 2012)

We do not deal with VAT. Please ask queries related to Excise Duty and Service Tax.
Dear Sir, What is cut off date for excise invoice.Whether excisable goods have to be removed on the same day of invoice or it can be removed on next day. any problem will arise. Pl explain. K.K.Srenivasan (Posted On: 25 Dec, 2012)

As per Rule 11 of Central Excise Rules, 2002 “no excisable goods shall be removed from a factory or warehouse except under an invoice signed by the owner of the factory or his authorized agent” Further this rule not clarifies about time limit of maintaining invoice before removal of goods. Therefore goods can be remove on next day of invoice but cannot be removed without invoice. Also, the time of issue of invoice and time of removal is to be mentioned on the invoice. Hence, there can be difference in issue and removal.
As per legal provisions, Service Tax is payable on gross amount charged for renting of immovable property less property tax actually paid to Municipality. For the half year ended on 30.09.2012, gross rent receivable is Rs. 30,00,000/- on which Service Tax @ 12.36% comes to Rs. 3,70,800/- which has been received / claimed from the tenant. But after taking rebate of Rs. 10,00,000/- on account of Property tax paid to Municipality from gross rent of Rs. 30,00,000/- , ‘A’ paid service tax of Rs. 2,47,200/- (i.e. 12.36% of Rs. 20,00,000/-) for the period under consideration. In other words, an amount of Rs.1,23,600/- is received in excess of actual service tax liabilities. You are request to kindly clarify the treatment of Service Tax received/ receivable in excess of ‘A’’s liability in books of account. Moreover, if the assessee has to pay excess service tax, what will be the treatment in future ?? MEETA SUKHIJA (Posted On: 24 Dec, 2012)

You have to charge service tax after deducting property tax from service receiver and not on gross amount i.e. in invoice service tax should be charged on Rs. 2000000/- As per section 73A(2) of Finance Act,1994 “where any person who has collected any amount, which is not required to be collected, from any person, in any manner as representing service tax, such person forthwith pay the amount so collected to the credit of the Central Government.” So the above provision makes it clear that any amount collected from service receiver has to be paid in the credit of the Central Government. So in the instant case you have collected service of Rs. 370800/- instead of Rs. 247200/- but as per provision of Section 73A, you have to deposit service tax of Rs. 370800/- to government.
We are manufacturer of sugar (Say –MS Ltd.) & selling sugar through Commission Agents. Now we want to start selling of specialty sugar (cubes, sachets, consumer pack etc.) through our group’s Company (say- MF Ltd.), not registered with Excise Deptt. The MF Ltd. wants to start invoicing of specialty sugar in the premises of MS Ltd. Can MF Ltd start the business in such manner as explained above or not and what are the legal formalities before the start of business? Kindly give yours expert legal advice. mukeshsharma (Posted On: 24 Dec, 2012)

The premises is registered with the Central Excise department and not the person. Hence, this premises is registered in the name of manufacturer and hence the agent cannot operate from the same premises. Further, there is clarification that even if the manufacturer intends to starts trading of same commodity which is being manufactured by him then he has to get the permission from the commissioner.
I want to know that in case we have rented a shop to an MNC, so are we as a landlord, liable to pay service tax or it's the MNC who's liable to pay it. Also, is there a way that we can track the payment status through the service tax assessee code online. Manish (Posted On: 23 Dec, 2012)

“Renting of Immovable Property Service” is not covered under reverse charge machanism therefore 100% service tax has to be paid by service provider. For second query:- there is no system to track online payment status, however you can make the payment online.
Sir, I have filed the qtr REturn for April-June'12 on Automobile Service - S.tax Return, let me know the July-Sept'12 Return filing date,i.e. when to submit the same, kindly give details ASHOK D CHOWRIWAR (Posted On: 22 Dec, 2012)

The date of filing of return for the period from July to September is not notified yet. The number of changes has been made by negative list regime. But these are not incorporated in the returns. Hence this amendment has come. So wait for CBEC Notification in this regard.
Dear Sir,Please tell me Is tds adjusted on payment of GSP Charges? mukesh chauhan (Posted On: 22 Dec, 2012)

We do not dealt with Income tax. Please ask queries related to service tax and Excise.
Dear Sir, We are Pvt. Ltd. Co. we received security service from agent who is not registered under service Tax as Turnover is below 10 Lacs .They provide us bill with out charging any service tax.Whether we have to deduct service tax and how much i .e 12.36% on bill or 9.27% on the bill they provided Santosh Kumar Singh (Posted On: 22 Dec, 2012)

Under security service reverse charge is applicable if service provider is individual, firm or HUF and service receiver is body corporate and therefore reverse charge is applicable in the instant case. Further as per Notification 33/2012-ST(Threshold exemption Notification), the threshold exemption of Rs. 10 Lakhs is not applicable in a case service receiver is liable under reverse charge. Therefore you are liable to pay service tax under reverse charge. In security service, liability of service receiver is 75% under reverse charge. Hence, you are liable to pay 9.27%.
hisir,price of one of the items in excise invoice has wrongly been mentioned on higher side and the materials have already reached the customer.The whole transaction completed within a span of 2 days.Please guide us what is the remedy to correct this. Ramesh (Posted On: 21 Dec, 2012)

Reply:- You can issue the Debit Note for differential amount i.e. excess amount with excise impact. But to take the excise portion back, you have to apply for refund.
Whether re-packing and re-labeling and putting MRP of Imported products falling under chapter 3808 amount to manufacture or not and Is Excise Duty applicable or not for the same. HN Manjunatha (Posted On: 20 Dec, 2012)

Chapter note 9 of chapter 38 says “In relation to products of Chapter 38 (except products of chapter 3808), Labeling or relabeling of containers intended for consumer or repacking from bulk pack to retail packs or adoption of any other treatment to render the product marketable to the consumer shall amount to manufacture”. Since your product falls under Chapter 3808 then this chapter note will not apply. However, chapter 3808 is chargeable to MRP based valuation by virtue of serial number 45 of Notification 49/2008-C.E.(N.T.) dated 24.12.2008 and as amended. For goods covered under third schedule (MRP based valuation), the above mentioned processes also amount to manufacture as per Section 2(f)(iii) of Central Excise Act. Therefore, excise will be leviable on products falling under chapter 3808 if the processes mentioned in query are undertaken by you.
whether the value of ancillary to be included in the value of manufacture. prakash (Posted On: 19 Dec, 2012)

Your query is not clear. Please ask query clearly with complete detail.
Dear Pradeep Sir, One of my client is giving commission on his manufacturing sales sales amount and receiving the bill of service tax by commission receiver so please guide us that my client should be claim service tax against his manufacturing liability central excise duty in manufacturing return ER-1. Waiting for your early response in this regard. Thanks & Regards, Kalpana Singh kalpana Singh (Posted On: 18 Dec, 2012)

As per Rule 2(l) of Cenvat Credit Rules, 2004 Input service means “any service used by a manufacturer whether directly or indirectly, in or in relation to the manufacture of final product and clearance upto the place of removal” further it also include service used in relation to ‘sales promotion’. In 'Commissioner of Central Excise, Raipur V. Bhilai Auxiliary Industries' - 2009 (14) STR 536 (Tri. Del) held that the services provided by the commission agent, which are nothing but the services of sales promotion, are covered by definition of 'input service' and therefore the service tax paid on the commission received by the commission agents as Cenvat credit. Further the second part of definition is inclusive and includes services like sale promotion, market research; advertisement etc. which are only example and services similar to these services is also treated as input service. As the definition is inclusive, Cenvat credit on commission will be sales promotion and hence the credit should be allowed.
dear sir, good afternoon....we are in the manufacturing of salt. we are having many labour contracts such as labour contract for loading,stacking , bharati,liner filling, shifting, packing etc. query is can we come under the reverse charge mechanism of manpower supply service. and we have to pay service tax on 75% of amount charge in bill.... thanks in advance sir abhishek agarwal (Posted On: 18 Dec, 2012)

Rule 2(g) of Service Tax Rule, 1944 defines supply of manpower to means:- “supply of manpower temporarily or otherwise to another person under his superintendence or control” So the essential character of manpower supply service is that the manpower should work under the superintendence or control of service receiver. In instant case, it is mentioned that there is contract for loading, filling, Packing etc. If there is a contract for these works and consideration is related to quantum of work and not related to number of laborers supplied then it cannot be treated as manpower supply. It is just a contract for work. Therefore, reverse charge will not be apply. But if there is simply contract for labour supply and labour is work under the superintendent and control of service receiver then reverse charge will apply if service provider is individual, HUF or Firm and service receiver is body corporate.
There is a company XYZ Ltd. Which has subsidiary company ABC Ltd. XYZ Ltd incurs advertisement expenses for advertisement of their own products & simultaneously also promotes the products of its subsidiary co. ABC Ltd. The advertisement expenses bills are on the name of XYZ Ltd & which in turn pays the same. Now our query is (i) Whether That Proportionate amount of advertisement exps. recovered by raising debit note by XYZ Ltd from ABC Ltd are liable for Service Tax if the recovery of advertisement exps. are on actual proportionate amount of advertisement exps? (ii) What if the XYZ Ltd issues debit note to ABC Ltd with addition of same markup on such advertisement exps.? In our view if the recovery by XYZ Ltd from ABC Ltd is on actual basis then there should not be any service tax since the element of consideration is missing and further the advertisement services are covered under negative list so ABC Ltd can claim exemption under the same. Pls. guide Hemant (Posted On: 18 Dec, 2012)

Under the negative list, only the service by way of “selling of space or time slot for advertisement” is exempt from service tax. Whereas, in the instant case, XYZ Ltd. is not selling the space or time slot to ABC Ltd. Further, the bill is issued in the name of XYZ Ltd. Therefore, it also not satisfies the condition of Rule 5 of Service tax (Determination of Value) Rules for claiming benefit of Pure Agent. Therefore in our opinion, service tax will be levied on amount reimbursed from ABC Ltd whether such reimbursement is on actual basis or with some margin.
Dear sir, in case of GTA service there should be 2 parties(consignor and consignee) is required to become liable under GTA. or if company use transporter for carrying goods from factory to site is liable under GTA service attract reverse charge. Naveen Kumar K T (Posted On: 18 Dec, 2012)

Your query is not clear. Under Transport of Goods service, 100% liability of service tax will be on the person who is liable for paying freight subject to the exemption upto Rs. 750/1500
Dear sir, gta services received and invoice received in june 12 but payment made in nov. 12. whether abatement can be claimed under 13/2008 or 26/2012 with no claim cenvat certificate from SP p s pawar (Posted On: 18 Dec, 2012)

Yes you can claim the abatement of 75% because there is no any change in the rate of abatement i.e. in 13/2008 and 26/2012, rate of abatement is same. Further you can also take the credit (if not disallowed otherwise) of service tax paid on GTA service as service recipient because the restriction of non-availment of credit is only for service provider and not for service receiver.
is piecemeal worker contract like Rs.2/bag for unloading a manpower supply ? VIDUR (Posted On: 11 Dec, 2012)

Rule 2(g) of Service Tax Rule, 1944 defines supply of manpower to means:- “supply of manpower temporarily or otherwise to another person under his superintendence or control” So the essential character of manpower supply service is that the manpower should work under the superintendence or control of service receiver. In instant case, it can’t be treated as manpower supply as there is contract for unloading work for which consideration is related to quantum of work and not related to number of laborers supplied. However, the terms and conditions of the agreement are important.
Dear Sir, when we open the ammend in service tax registaration should we tick also on service receipent under payment of service tax under reverse charges as we have alraeady mentioned in prevoius query that we are registered as service provider .will the registration amend with service provider along with service receipnt .please advise sir Alok Gupta (Posted On: 10 Dec, 2012)

If you are liable to pay service tax as service recipient under reverse charge system, you should amend your service registration accordingly and should also tick on “service recipient liable to pay service tax under reverse charge”.
Dear Sir, We are Importer of Machinery. When we Imported a machine we contract with a shipping agency. My question is that can we take credit of Service tax if foreign shipping agency deliver the machinery and made a bill in the name of indian shipping agency and the amt. paid to foreing shipping agency by the indian shipping agency. and in bill we are mentioned as importer. Please solve it Sir. In above reference please tell me that can we take credit of the ST paid by indian shipping agency on our behalf if bill is raised in the name of shipping agency Saurabh Khandelwal (Posted On: 10 Dec, 2012)

Yes, you can take the Cenvat credit on bill of Foreign Shipping Company if your name is mentioned in the bill of foreign shipping company.
Dear Sir, we have registered with service tax department as service provider. we are paying service tax on reverse charge being service receipnt. we would like to know should i chnage or amend the registration or it is not required. further if we are liable for amend then is there any time lime for amend in registration for service receipnt alok gupta (Posted On: 09 Dec, 2012)

On introduction on negative list, it was said that the registration will be under the head "other than negative list"only. But recently the CBEC has reintroduced the classification of services. Even the registration is to be taken in this category. Therefore, the registration is to be done in that category for which you are paying service under Reverse charge method.
We r running a hotel and paying service tax regularly. Can we claim cenvet of input like management fees paid for running hotel, amc of plsnt and machinery etc.. Pl advise Haresh Raithatha (Posted On: 09 Dec, 2012)

There are number of abatements available to Hotel industry viz. for accomdation service, restaurant service, Mandap keeper service, rent-a-cab service etc. The Cenvat credit has been allowed even with abatement of accomdation, restaurant and Mandap keeper service. But the credit is not admissible if you are availing rent-a-cab service. Hence, one has to see the conditions attached to abatements. If you are availing only abatement on three services then credit is available.
Sir ji.. Service tax on builders is applicable from July 2010. What is the status on the liability if the agreement is entered into before and the amount received after July 2010 visu (Posted On: 08 Dec, 2012)

At that time, the Government has exempted the amount received prior to July 2010. But the Gujarat High Court has held that the service tax is not linked with invoice raised or payment received but it is linked with the provision of service. Hence, following the ratio of this decision, one can say that the service provided till July 2010 will also be exempted. But the work undertaken after that date will be taxable. However, the litigation is inbuilt. But it has nothing to do with the agreement entered prior to this date. It is only linked with service provided. It is worthwhile to mention here that the current Point of Taxation Rules were not prevailent at that time and service tax was payable on receipt basis.
Sir ji.. Pl. clarify on the interest is taxable for a clearing and forwarding agent; who deposit Rs.50 lacs as deposit to the principal for the stock of Principal as security deposit. The servie tax on commission earned by the assessee is discharged. Do the interest on the deposit as per agreed rate is taxable? Since the amount of deposit is part of the business service visu (Posted On: 07 Dec, 2012)

The interest on deposit is exempt under the negative list. But however, it has to be proved that the same has not influenced the value of taxable service.
Sir ji.. The client is providing printing on aluminium foils where the ink and the foils were given by their principals. the client is paying VAT will there is a service involved and taxable under service tax.? visu (Posted On: 07 Dec, 2012)

Since you are undertaking the job work, the process undertaken by your client amounts to manufacture then there is no liabilty of service tax. Supposing this process does not amount to manufacture then also, if the supplier has given the job work Challan under Rule 4(5)(a) of Cenvat credit Rules or under notification number 214/86 then it implies that supplier will be using further the same in manufacture of final product then also no service tax is payable. Furhtermore, the process of printing is also exempt under point 30 (a) of megha exemption notification. Hence no service tax is payable on the same.
Dear Sir, We are Importer of Machinery. When we Imported a machine we contract with a shipping agency. My question is that can we take credit of Service tax if foreign shipping agency deliver the machinery and made a bill in the name of indian shipping agency and the amt. paid to foreing shipping agency by the indian shipping agency. and in bill we are mentioned as importer. Please solve it Sir. Saurabh Khandelwal (Posted On: 06 Dec, 2012)

It seems that Indian shipping agency has paid the amount on your behalf. CHA normally makes many payment on behalf of importer or exporter like fork lift charges, loading and unloading charges etc. and reimburse the same form them. The department invariably objects the same. Normally, the name of exporter and importer is not mentioned in service tax invoice. But if your name is appearing in the service tax invoice, then we donot forsee any problem in taking the credit. Even if the department raises the objection then it can be very well established that the shipping line has paid the amount on our behalf and we have reimbused the same.
Dear Sir, We are manufacturing Unit of steel (Scrap to TMT).during the last year we made sale of some raw material (Scrap) means in terms Input removal as such (trading) now during audit by excise department they remark it and they want to reversal of input service credit (on carriage inward and other services) in Proportnate basic on apply Rule 6 (3) of Cenvat credit rules 2004. And charged interest on it. Can they do this? According to me Trading is not a part of Service Supporting By case Laws 1. 2010(17) S.T.R. 517 (Tri.-Del.) in the CESTAT PRINCIPAL BENCH New DELHI, J S KHALSA STEEL (P) LTD V/s COMMISSIONER OF C. EX. CHANDIGARH. 2.2010 (256) E.L T 420(Tri –Del) in the CESTAT PRINCIPAL BENCH New DELHI, A R CASTING (P) LTD V/s COMMR. OF EX. & S TAX CHANDIGARH. Please Provide Correct Solution. CA RAJAT JAIN 9166132638 rajat22jain@gmail.com Rajat jain (Posted On: 06 Dec, 2012)

Under the new regime of negative list, the trading has been referred under the negative list and if we go by the defintion of "Exempted service" given under the Act, then it says that items mentioned in negative list will also be treated as exempted service. Hence, the trading activity will be exempted service only. Hence provision of Rule 6 will apply. Even Rule 6 also gives the method to compute value of trading activity as sale price minus purchase price or 10% of cost of goods sold, whichever is higher. Hence, the department will ask for the reversal of credit. But most of consutlants are of the view that the trading activity is sale and it cannot be referred as exempted service or rather service itself. But for this purpose, this provision is to be challenged in High Court.
What is the margin line which demarcates Works Contract Service and Construction Service??? This query has been raised because both the mentioned service have the provision of construction of immovable property. Manoj Khatri Advocate Kanpur. Manoj Khatri (Posted On: 03 Dec, 2012)

When the title in the goods also transfers along with service then the service will fall under works contract. But pure labour contract where no material is involved then it will fall under construction service.
Dear Sir, I am associated with a autonomous body which is regulated by Central Government.This body is taking manpower services from an agency for office staff and all. My query is can we claim exemption from paying service tax on the aforesaid service as per the below circular. [TO BE PUBLISHED IN THE GAZZETE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)] Government of India Ministry of Finance (Department of Revenue) Notification No. 25/2012-Service Tax New Delhi, the 20th June, 2012 G.S.R……(E).- In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the said Act) and in supersession of notification number 12/2012- Service Tax, dated the 17th March, 2012, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 210 (E), dated the 17th March, 2012, the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the following taxable services from the whole of the service tax leviable thereon under section 66B of the said Act 12. Services provided to the Government, a local authority or a governmental authority by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of - a civil structure or any other original works meant predominantly for use other than for commerce, industry, or any other business or profession; a historical monument, archaeological site or remains of national importance, archaeological excavation, or antiquity specified under the Ancient Monuments and Archaeological Sites and Remains Act, 1958 (24 of 1958); a structure meant predominantly for use as (i) an educational, (ii) a clinical, or (iii) an art or cultural establishment; akash (Posted On: 02 Dec, 2012)

The exemption as mentioned in this circular or under Mega Exemption Notification is available only in respect of services e.g. construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation etc. and this exemption is not allowed in respect of Manpower Supply service. Therefore you are not eligible for this exemption.
In the hotel industry we have booked the conference room and provide high tea to all members. Now my question is whether high tea also covered under Supply of food as a part of function for renting and whether in that case we are liable to pay service tax 8.65 under abatement ( Taxable value of 70%) or liable to pay service tax @12.36%? Navin Jain (Posted On: 01 Dec, 2012)

Under the Negative list regime, if there are two or more services are provided then the service tax will be paid under that category which gives colour to overall services. Since the service was taken for conference, hence the service tax will be charged under this head and abatement @ 70% is correct.
We are manufacturing co. and we have a contract of transport of our staff from railway station to factory and back. The operator is not in service tax as his limit is under 10 lacs. in this case whether we are liable for service tax and whether 100 % or 40% and further under which cod ewe have to pay servic etax ANIL KUMAR (Posted On: 01 Dec, 2012)

Firstly the service tax will not be levied if it is treated as “Contract Carriage” because it is exempt under notification 25/2012-ST. The essential characters of contract carriage are as follows: 1. The vehicle should be engaged under a contract - whether expressed or implied. 2. The use of such vehicle as a whole for the carriage of passengers mentioned therein. 3. The contract is either on a time basis (whether or not with reference to any route or distance) or it is on destination basis (from one point to another) 4. The vehicle does not stop to pick up or set down passengers not included in the contract anywhere during the journey. As your query is not clearly show the contract description, so you are not able see that your contract is covered under the above definition of contract carriage or not. If this contract is not treated as Contract carriage, then reverse charge will apply. It will be applied only if service provider is individual, HUF or Firm and receiver is body corporate. In such case, if abatement of 60% is not claimed (abatement is option) then 40% liability will be on service receiver but if abatement is claimed then service tax will be levied on 40% of value and 100% liability of service tax will be on service receiver.
Our client is in Oilfield services providing Drilling & Workover rigs to ONGC & others. They use Bunk house for stay of employees at Rig site which is generally located at remote area. They purchase readymade Bunk House, whether CENVAT on bunkhouse can be claimed as credit against payment of service tax on oilfield service ? Further, they also use services of outside caterers there, whether service tax thereon can be claimed as credit ? CA. Vijaysinh Chauhan (Posted On: 30 Nov, 2012)

As per definition of Input service given under Rule 2(l) of Cenvat Credit Rules, 2004 “input service means any service used by a provider of output service for providing an output service and includes services used in relation to modernisation, renovation or repairs of premises of provider of output service or an office relating to such premises, advertisement, accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security etc. Further the definition excludes:- Such as those provided in relation to outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits extended to employees on vacation such as Leave or Home Travel Concession, when such services are used primarily for personal use or consumption of any employee Therefore input credit of services related to bunk houses can be allowed. But outdoor catering service may not be allowed because it is used primarily for personal use of employees which is excluded from the definition.
we have received services from a caro handling agency on 01.07.2011 but paid him on 29.03.2012. We already filed refund claim, is it tenable? S.Bagchi (Posted On: 29 Nov, 2012)

Your query is not clear.
Booked flat in 2009(building yet incomplete consideration paid). And builder is asking for service tax. But i found various article that personal use can be exempt but not very clear. Need your expert input whether any exemption available or I have to pay service tax. and i paid vat as WCT but builder saying for service tax its construction services that's alos confusing me. what exectly status for this? Need quidence as laymen person not in legal terms Bharat (Posted On: 29 Nov, 2012)

The service tax on builders have come from 1.7.2010. If the flat is sold and the payment is received in installment while the projec is under implemtation then the service tax is applicable. During that period if a residential complex had more than 12 units then the service tax is applicable. The buidling is made from material and labour, the VAT is paid for material part and service tax is payable for service part. Hence both are payable on construction of buidling.
Dear Sir, Our co. is using Manpower supplying Agency's service & has taken credit of service tax charged by manpower supplying agency, but this agency has not deposited the service tax collected from its clients to govt. deptt, so Department has issued showcause notice to our company & asked for the reversal of credit already taken, So can u plz suggest me what should we do & whether Deptt. can take such action against service receiver & plz give some legal supporting or any case law -- Thanks & Regards CA Neha Neha (Posted On: 28 Nov, 2012)

As per Rule 4(7) of Cenvat Credit, Rules 2004, “the Cenvat Credit in respect of input service shall be allowed on or after the day on which the invoice, bill or challan as the case may, is received” Further the service receiver cannot be liable for default of service provider in respect of non-payment of service tax. As per Explanation II of Rule 4(7), “if the manufacturer of goods or the provider of the output service fails to pay the amount payable under this sub-rule, it shall be recovered under the manner as provided in rule 14”. Further Rule 14 provides that the service tax along with interest shall be recovered from provider of output service and provision of section 73 and 75 of the Finance Act apply mutatis mutandis for effecting such recoveries. The above provisions make it clear interest and penalty will be leviable on defaulter. Further there are many cases in which held that credit cannot be denied due to default by service provider when amount in invoice already paid to supplier. e.g. 2010 (19) S.T.R. 772 (Tri. - Bang.) COTTON COUNTY RESORTS & ESTATES PVT. LTD. Versus COMMISSIONER OF C. EX., BELGAUM
Dear Sir, Greetings of the day..... We are in to manufacturing industry and do not provide any services.my query is can we take the credit of service taxes that we paying?...like in phone bills, transportation of raw materials etc... Thanks in advance. Sudheesh K C (Posted On: 28 Nov, 2012)

The Cenvat credit of input services is also allowed to manufacturers. The credit taken on input services can be utilised for payment of excise duty on final product.
Sir a company have received a bill for man power supply on which service provider is liable to pay 25% of the servicetax but he have charged 100% of the servicetax in invoice and the company had paid to the service provider the full amount. My question is whether still the service receipient the company is liable under reverse charge to pay the 75% of the amount of tax by GAR7 challan when whole of the tax is paid by service provider? Vinay Jhawar (Posted On: 27 Nov, 2012)

The statutory liability to pay service tax is on the company and it cannot be shifted to other person. Hence the department will object the same. But it can be successfully pleaded that when the service tax is already paid then double service tax cannot be demanded on same transaction. But the litigation is inbuilt.
Sir, We are a heat treatment processing unit. We receive gears/ other automobile components from our clients on which we carry out the process and sent them back. Majorly we receive the material on challans as per rule 4(5) of cenvat credit rules. and very few on non exciseable challans. I have 2 questions. 1)Do we need to apply service tax on material received on challans as rule per 4(5)? 2) For the exemption of upto 10 lakhs of turnover for labour charges, do we need to take into consideration the turnover for material received on challans as per rule 4(5) of cenvat credit rules. Akshay Chhajed (Posted On: 26 Nov, 2012)

First of all, when the material is received on job work challans under Rule of 4(5)(a) then it implies that the supplier is using this material in his factory in further manufacture and paying Excise duty on the same. Hence, there is no need to pay the service tax. But if the material is received without chalans then we have to see whether the process employed by us amoounts to manufacture or not.If it amounts to manufacture then no service tax is payable. In other case also, threshold exemption of Rs. 10 Lakhs under notificaiton 8/2003 is available. There is no need to add the value of exempted services in the same. Hence, the material supplied under rule 4(5)(a) will not be added.
is deduction for amount paid to subcontractor is available to builders & developers if they opt for composition @ 5% ? chaitanya (Posted On: 26 Nov, 2012)

Although your query is not much clear. However, the service tax paid by subcontractor is available to developers even if they pay service tax. The abatement available to buider is 75%.
Sir, We are manufacturer of machine we have some bills of CENVAT of may,12 of which credit was not taken by us. Can we take now of These bills in Nov,12 return? Saurabh Khandelwal (Posted On: 26 Nov, 2012)

If the excise duty is paid on your final product then you can take the cenvat credit on inputs. There is no time limit is fixed in the Cenvat Credit Rules. It only says that the credit can be taken immediately. There are decisions which says that the credit can be taken even after period of six months.
My query is about transport of goods by road services. One of my client is providing services to companies(companies paying Service tax. he is not filing returns(NIL) from the registration date i.e from april 2005. my query is whether Late Fees and penalty Attracted or not? If yes how can we escape from late fee and penalty proceedings? Whether we have to show total service amount provided to company in ST-3? Raghavender Upadhyay (Posted On: 25 Nov, 2012)

There are decisions which says that the late fee is not to be paid for non filing of nil returns. Even the Section 70 prescribing late fee starts with words "Every person liable to pay the service tax.......". When no service tax is payable then it can be pleaded that the service provider is not a person liable to pay tax and as such these provisions does not apply to him. Thus, there is no need to pay the late fee.
In R/o Renting Service there is common practice of receiving security deposit from service receiver. Whether Notional interest accrued on said security deposit is required to be added in taxable value. & What will be the rate of interest to be considered. Manoj Khatri Advocate Manoj Khatri (Posted On: 24 Nov, 2012)

The department is demanding service tax on this notional interest. They take normal bank interest for the same. This concept has been borrowed from the Central Excise. But the decisions on this issue says that nexus has to be proved that the security deposit has influenced the assessable value. If the same is not proved then the duty can be demanded. Similarly, if one can prove that the security deposit has not influenced the rent, then there is no service tax.
Sir,The client is claiming CENVAT credit on due basis. While filing the Service Tax Return for QE June, 2012, total CENVAT credit taken during the period is Rs. 100. However, CENVAT credit reversed during the period is Rs. 500/- as the client has not paid the bills for more than 90 days. Now, there is no suitable column in the CENVAT credit details where the amount reversed as CENVAT may be shown in the return. I tried to show the CENVAT credit taken during the period as net amount after adjusting reversed CENVAT, but as the figure became negative, the software is showing error while validating the XML file. Therefore, I am looking forward to your advise in such a case so that the ST-3 may be filed. CA Sandeep Jain (Posted On: 24 Nov, 2012)

If the amount paid is more than credit available then it has to be paid in cash. In EXcise also, if the credit to be reversed (say on audit objection) is more than credit taken then credit is reversed to the extent balance available in register and rest is to be paid in cash.Similar treatment is to be given here also and negative balance cannot be shown.
Dear Sir We are an SSI unit claiming exemption on clearances upto 150 lacs and have never claimed cenvat. Recently we exported to Nepal and not knowing about the change in rules did not have a bond or LUT and sent goods without paying duty as we thought our sale is only at 70 lacs so duty is not applicable. Now department is asking for duty to be paid even though we are still in our limit? do we pay this duty on export?? K P Singh (Posted On: 23 Nov, 2012)

This case can be defended very well. Although we have not followed the procedure yet there is no doubt about the export of goods. The technical and procedural breaches should not come in the way of extending substantial benefits. Also, if we have not followed the procedure then it should not be trreated as export, hence should be treated as home consumption and added in total overall limit of Rs.1.5 crore.
Sir, this is construction company service tax under WCT and here wrongly taken cenvat credit in previous ST3 returns, now we want to removed those figures and where we removed those figures in current ST3 returns. Can you please advise us. Vijay (Posted On: 23 Nov, 2012)

The ST-3 return can be revised in three months. Secondly,the same figures cannot be amended in current ST-3. You can only reverse the excsee credit taken in current ST-3 return.
Sir, We, a private ltd Co, have entered into annual maintenance contract with a private firm for the maintenance of 7KVA UPS System installed in our office premises and Rs.12,000/- paid towards AMC charges at the time of execution of the AMC. The service provider has not claimed service tax in his bill. As per the terms of AMC the service provider will undertake periodical maintenance service consisting of preventive and corrective maintenance of the system and will supply and replace parts wherever required. The parts so removed shall be the property of the service provider. However replacement of defective batteries is not covered under the scope of the AMC. It may pl. be clarified whether we as service receiver do pay any service tax under reverse charge provisions on this AMC. Regards, Nagarajan V nagarajan v (Posted On: 21 Nov, 2012)

Since the AMC includes the replacement of parts, hence this will be covered under works contract. If the service provider is individual, HUF, partnership or AOP then the reverse charge mechanism will be applicable in your case as you are a private Limited company.
A service provider taken St regd in May 12 and his total receipt is <10 lac and not paid any service tax ,will he is livable to file St 3 for June 12 and cir no under which exempted ajay (Posted On: 21 Nov, 2012)

Yes, he has to file the service tax return. Even the nil return has to be filed.
Sir ji.. I have a doubt on GTA wrt renting of trucks to Goods transport agency which is exempted or are taxable. If taxable there shall be double taxation lorry owner and service proider pl. clarify visu iyer (Posted On: 18 Nov, 2012)

The transportation of goods by GTA and courier service are only taxable. Hence the transporatation of goods by lorry owners is not liable to service tax.
please clarify wither printing school magazine for school children on science subjects to aid their studied (not guilde)are taxable as business activity under the amended provision of section 2(15) of the income tax act, 1961 P.J.JOSEPH FCA (Posted On: 17 Nov, 2012)

We only deal in Central Excise, Service tax, DGFT and Customs. Hence we are unable to reply related to Income tax. Sorry for the inconvenience.
we r the associate of gati ltd.can we avail SSI Exemption. departments argument is you r using brand name hence u r not entitle for ssi exemptionn. please suggest nilesh jain (Posted On: 17 Nov, 2012)

If you are using brand name of any other person then you are not eligible to claim threshold exemption of Rs. 10 Lakhs.
electricity distribution company has given contract to a co-op bank to collect costmer bills,bank raised bill including service tax, my query is The company have to pay service tax? if yes, how to calculate and pay? swaraj (Posted On: 16 Nov, 2012)

Service tax will be leviable as the service is neither covered under negative list nor under mega exemption notification 25/2012-ST. The service tax will be leviable @12% on the consideration given to said bank.
Sir, Can you pl. guide me how to answer the audit query from the ST department? We have availed (import) services from our parent company Canada, during the period from 01st April 2004 to 31st March 2006. We have remitted the amount to our parent company in the month of July 2007, and accordingly we have remitted ST amount calculated @ 10.24%. Now the department is demanding to pay the differential amount of 2.12% ( 12.36% - 10.24%), since the rate is applicable during that period and also demanding interest for the differential amount up to today. Is that right or we can pay and go for appeal? Regards, S Ramakrishnan, S Ramakrishnan (Posted On: 15 Nov, 2012)

The service tax on import of service cannot be imposed prior to 18.4.2006 as per Apex Court decision in case of Indian Shipowners Association [2010(17)STR J57]. When you have provided the services prior to this date, then service tax is not payable at all.
sir, in the period from apr june 12 the service tax is to be paid /charged on 2 rates i:e 10% and 12% as some bills are issued before 31/3/12 but there us no provision of 2 rates in the ST 3 for issued by the department for this period ajay (Posted On: 15 Nov, 2012)

This seems that you are paying service tax on receipt basis ( this is applicable if the total taxable value in preceeding financial year is below Rs. 50 Lakhs). Then the CBEC has clarified that if the receipts are after April 1, then the service tax is to be paid @ 12% only. Although this has been challenged in High Court but outcome of the same is still awaited.
One of my client are doing packing of oil for a company. They fill the oil in various marketable size, pack them,label them and pack into cartoons. Company is paying us the charges on the basis of packed items. like 25 paisa per bottle. Now I want to ask whether this service is taxable or not. Company is saying the service is exempt due to it is a manufacturing process. Please clarify. Ashok Agarwal (Posted On: 14 Nov, 2012)

CBEC has power to declare certain processes as "manufacture". In some chapter notes as well as for the MRP based valuation, packing, repacking from bulk to retail as well as labelling and relabelling will amount to manufacture. Hence the excise duty is payable on the same. Since you are doing job work of packing and if the excise duty is being paid on the same, then the service tax is not payable as per clause (f) of negtive list in Section 66D.
one of my client paid excess service tax for the quarter April To June , whether he will get credit for the same in next quarter if yes then in ST-3 Return sin which column it has to be writtern of credit available for next quarter bhavesh k mehta (Posted On: 14 Nov, 2012)

As per Rule 6(4A) of Service Tax Rules 1994, "Notwithstanding anything contained in sub-rule (4), where an assessee has paid to the credit of Central Government any amount in excess of the amount required to be paid towards service tax liability for a month or quarter, as the case may be, the assessee may adjust such excess amount paid by him against his service tax liability for the succeeding month or quarter, as the case may be." Further Rule Sub Rule 4B of Rule 6 provide that “the adjustment of excess amount paid under sub Rule 4A shall be subject to the condition that the excess amount paid is an account of reasons not involving interpretation of law, taxability valuation or applicability of any exemption notification” So according to above provisions you can adjust the excess amount paid towards your succeeding month or quarter’s liability subject to the fulfillment of conditions mentioned in sub rule 4B. But the adjustment is allowed only for the succeeding month or quarter’s liability.
Dear Sir, When services (security & manpower supply ) are provided prior to 31st March’12 & bill is also raised on 9-March @ 10.3% Service Tax and outstanding provision is also created. Kindly clarify service tax rate for release of payment. Regards Atul Gaur atul gaur (Posted On: 12 Nov, 2012)

As per Rule 4 of Point of Taxation Rules (as applicable in relevant period), in case of change in effective rate of tax:- If Service has been provided before the change in effective rate and also invoice is issued before the change then point of taxation will be date of invoice. Therefore in the instant case Point of taxation is 9th March and rate will be applicable as 10.3%.
Sir, does reverse charge applies, if the service recipient is a hospital registered as charitable trust Charanjeet (Posted On: 10 Nov, 2012)

Under all the points as given in the Notification no. 30/2012-ST (reverse charge mechanism) there is common essential character for service receiver is that, it (service receiver) should be business entity or body corporate. But normally entities registered under section 12AA do not work as a business entity. Also, trust does not fall under Business corporate.
we are excise registered dealer and mfg branded goods. as this is first there is no other sales except branded goods sale. this is first year of company and turn over is 50lacs. But excise is payable on branded goods so return will be monthly or quarterly. is there in clarification regarding this from department Bharat (Posted On: 09 Nov, 2012)

As per Rule 12 of Central Excise Rules 2002, (Filing of return) "(1) Every assessee shall submit to the Superintendent of Central Excise a monthly return in the form specified by notification by the Board, of production and removal of goods and other relevant particulars, within ten days after the close of the month to which the return relates i.e. Monthly Return ER-1." Further proviso 3 of the above rule 12(1) provides: “Provided further that where an assessee is eligible to avail of the exemption under a notification based on the value of clearance in a financial year (i.e. SSI), he shall file a quarterly return in form specified, by notification, by the Board, of production and removal of goods and other relevant particulars within ten days after the close of the quarter to which the return relates. i.e. ER-3. Explanation 1 – For the purpose of this proviso, it is hereby clarified that an assessee shall be eligible, if his aggregate value of clearance of all excisable goods for home consumption in the preceding financial year computed in manner specified in the said Notification did not exceed rupees four hundred lakhs. As per above explanation company is eligible for SSI exemption as its first year there it has to file quarterly return.
Sir.. I am in construction business..we hire motor vehicles for commutation of employees at sites..Can we claim cenvat credit against the service tax paid on renting of motor vehicles? Sk (Posted On: 08 Nov, 2012)

According to Section 2(i), Input service excludes “(B) service provided by way of renting of motor vehicle, in so for as they relate to a motor vehicle which is not a capital goods” And according to section2 (a) Capital goods includes, “Motor Vehicle design to carry passenger including their chassis, registered in the name of provider of service, when used for providing output service of- (i) transportation of passenger; or (ii) renting of such motor vehicle; or (iii) imparting motor vehicle skills” It means input credit on taxi hire is allowed only to those which are provider of output service of transportation of passenger or renting of motor vehicle or imparting motor vehicle skills. Therefore credit is not allowed in instant case.
Sir, our companyis into manufacturing of textile fabrics. has job work contracts with our matetials supplied to them. Will it attract service tax Haridu Hussain (Posted On: 08 Nov, 2012)

Your query is not clear that what activity is involved.
IN SERVICE TAX RETURN FOR APRIL TO JUNE 2012 FOR TRANSPORT OF GOODS BY ROAD SERVICE WHICH NOTIFICATION NO. IS TO BE FILLED FOR CLAIMING ABATEMENT OF 25%, AS 1/2006 IS NOT TAKING IN THE RETURN CA ANAL MAROTI (Posted On: 07 Nov, 2012)

In ‘Transport of Goods by Road’ service there is exemption of 75% and not abatement. Therefore Notification 13/2008-ST has to be filled for claiming this exemption and not notification no. 01/2006-ST.
Sir, Time and again your interpretation of cases is very helpful. We are in the garden development and maintenance services. many times we buy flowering and other indoor plants from nurseries. Then, we use these plants in our ongoing projects. We add our profit and raise the bill for these plants. So, in the first instance we buy plants from nursery (which is without any taxes), use it in projects and then adding our profit we raise bill to our client. Question is whether service tax is applicable when we prepare bill having plant items for our client? Kindly help. naresh pancholi (Posted On: 07 Nov, 2012)

We understood from your query that if we are purchasing and selling the plants then no service tax is applicable. But if we are not purchasing but maintaining the plants then service tax will be applicable.
Dear Sir, Our co. has engaged a contractor for regular maintenance of garden within the plant premises.Saplings,manure are be supplied by him and tools/tackles are provided by co. My question is- Does this contract come under reverse charge mechanism or to be treated as normal rep/mtce chargeable to serv tax @12.36% to be paid by contractor ? Regards, Sumanta Nag S,Nag (Posted On: 06 Nov, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” As in instant case transfer of material involved for maintenance of garden, therefore it will be work contract service. As it is work contract service therefore valuation rule 2A will be applicable and as per Clause (ii)(c) of this rule 2A, when value of material portion and service portion can’t be determine then service tax shall be leviable on 60% of total amount charged in case of work contracts relating to immovable property. Reverse charge will be applicable if service provider (i.e. contractor) is individual, HUF, partnership firm and service receiver is body corporate. Liability to pay service tax under reverse charge in case of work contract service is 50% on service receiver and 50% on service provider---…Notification 30/2012-ST. As you are saying that service provider is company therefore reverse charge will not be applicable and liability to pay service tax is on service provider only.
My query regarding to the remuneration to the partners of firm u/s 40(b). There is a case in the beginning of the year partners assume that there would be profit of Rs. 10 lac during the for example FY 2012-13 and withdraw the remuneration as per the limit u/s 40(b), however at the year end firm came to the conclusion there would be a loss, in this case whether remuneration given to the partner (which exceeds from the limit u/s 40(b))would be allowed under IT Act, if no then what are the ramification. Bhavana Agarwal (Posted On: 05 Nov, 2012)

Your query is related to Income Tax law and we do not deal with Income Tax Law. You can ask query related to Excise, Service Tax and Customs Laws.
Sir, my company have sold some old and used machineries and i want to know that whether sale invoice should be raised on sale of such old and used machineries. Ganesh Yadav (Posted On: 04 Nov, 2012)

Rule 3(5A) is related to treatment when “capital goods are removed after being used”, which is as follows:-- “(5A) If the capital goods, on which CENVAT credit has been taken, are removed after being used, whether as capital goods or as scrap or waste, the manufacturer or provider of output services shall pay an amount equal to the CENVAT Credit taken on the said capital goods reduced by the percentage points calculated by straight line method as specified below for each quarter of a year or part thereof from the date of taking the CEVAT Credit, namely:- (a) for computers and computer peripherals: ---- for each quarter in the first year @ 10%, for each quarter in the second year @ 8%, for each quarter in the third year @ 5%, for each quarter in the fourth and fifth year @ 1%. (b) for capital goods, other than computers and computer peripherals @ 2.5% for each quarter: Provided that if the amount so calculated is less than the amount equal to the duty leviable on transaction value, the amount to be paid shall be equal to the duty leviable on transaction value.” The above provisions mandate payment of excise duty (calculated as per these provisions) on removal of capital goods. As per Rule 11 of Central Excise Rules, 2002 ---(1) No excisable goods shall be removed from a factory or a warehouse except under an invoice signed by the owner of the factory or his authorized agent and in the case of cigarettes, each such invoice shall also be countersigned by the Inspector of Central Excise or the Superintendent of Central Excise before the cigarettes are removed from the factory. Therefore if excisable goods are removed from factory then invoice should be raised.
Does reverse charge apply in case of service provided before 1.7.2012 but bill booked after 1.7.2012 rohit singh (Posted On: 02 Nov, 2012)

Applicability of reverse charge is based on point of taxation. As per Rule 7(b) provides that in case of person required to pay service tax as recipients under reverse charge mechanism, the point of taxation will be the date on which payment is made to service provider. In instant case you have not mentioned the date of payment. So if date of payment is after 1.7.2012, reverse charge will apply otherwise not.
Sir, I got the bill from our firm of lawyers, they havent charged any service tax because service receiver needs to pay service tax. can I pay the service tax after deducting the cenvat credit that is available with my company? Also, I wanted to know how much payment I should made to the lawyer for the service i.e. after deducting tds only or after deducting tds and servicetax? Please clarify both my doubts. Meenu Agarwal (Posted On: 02 Nov, 2012)

You can’t pay this service tax liability by utilizing cenvat credit because as per Explanation given with Rule 3(4) of Cenvat Credit Rules, “Cenvat Credit cannot be used for payment of service tax in respect of services where the person liable to pay tax is the service recipient”. Further it is clarified that here service tax is not like TDS and service tax is leviable on value of service (i.e. value excluding service tax) therefore you have to make gross payment i.e. before deducting service tax.
Please confirm whether, Service tax reverse charge applicable or not on import of software kalpesh patel (Posted On: 01 Nov, 2012)

Import of software is not a service and sale therefore service tax is not leviable but if there is service involved then service tax will be leviable(if other conditions satisfy).
Sir, Thanks for reply my query..! my client taken Cash loan on Credit card in which Bank Charged Service tax on interest portion. he talk to bank regarding Service tax charged on interest portion, they reply that service tax is chargeable on Cash Loan on Credit card, whether it is correct or not...? Anup Moondra (Posted On: 30 Oct, 2012)

As per clause (n) of negative list given u/s 66D following is exempt from service tax:- “(i) services by way of extending deposits, Loans or advances in so far as the consideration is represented by way of interest or discount” Credit cards can’t be treated as loans or advances. Loans and advances are meant to signify amounts contractually negotiated as such (loan or advance) and not merely failure to pay an amount at the due date. In case of credit cards the exorbitant charges have also no relationship with the prevailing interest for the same class of creditworthiness and are in the nature of consideration for the services rendered for using the convenience of using the services by way of a credit card and can not be treated as interest of loan or advance. Therefore credit cards are not covered under above exemption hence it will be taxable.
Sir, we are Merchant exporter, based on Kutch Gujarat. My question is: whether Service tax paid on THC Charges used for exoport of goods (service provider is registered under BAS & BSS) be available as refund vide notification no 17/2009 & 52/2011 as department denied to grant refund on ground that service provider registered under BAS & BSS, is department correct in rejecting refund? plz reply ASAP awaiting your positive reply with regards, CA Akshay Joshi Akshay Joshi (Posted On: 30 Oct, 2012)

There are many cases in which department has disallowed the refund because service provider is registered under BAS/BSS service. In JOLLYBOARD LTD Vs COMMISSIONER OF CUSTOMS & CENTRAL EXCISE, AURANGABAD refund had been allowed even in invoice it is mentioned as “Documentation Charges” but service provider is actually registered under “C&F service”. Therefore category of service under which service provider is registered is important to claim refund.
Sir , we have a query , our firm is supplying stone ballast to the railways , now railway is asking us that they had received a letter from serevice tax department and our work falls in the scope of service tax from 1 april 2012.kindly resolve our query. vineet dave (Posted On: 29 Oct, 2012)

Your query is not clear. Supply of stone ballast is not a service and sale only then how service tax will be applicable. Please clarify which service you are providing?
Sir, if loan is taken from Bank and repayment by instalment, interst charged thereon is chargeable @12.36%. Anup Moondra (Posted On: 29 Oct, 2012)

No service tax is not leviable on Loans as it covers under Negative list as given under section 66D. As per clause (n) of said negative list following is exempt from service tax:- “(i) services by way of extending deposits, Loans or advances in so far as the consideration is represented by way of interest or discount”
Sir, We hare engaged in providing garden development services wherein we carry out certain agricultural operations to grow lawns (grass) and ornamental plants. For this we procure manures, fertilizers, plants, grasses, etc and use our team of labours and supervisors to execute the work. In one of our projects, client has deducted Works contracts Tax at the rate of 3.6% on advances. Still final bill is not raised. Our questions are: (1) Does garden making fall under the purview of Works Contracts Tax at all? (2) If yes, then is the rate at which it is deducted correct? (3) It is deducted on the total amount of advances, true? Your expert views are sought for this issue. Thank you. Regards, Naresh Pancholi naresh pancholi (Posted On: 29 Oct, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” As in instant case transfer of material involved for maintenance of garden, therefore it will be work contract service. As it is work contract service therefore valuation rule 2A will be applicable and as per Clause (ii)(c) of this rule 2A, when value of material portion and service portion can’t be determine then service tax shall be leviable on 60% of total amount charged in case of work contracts relating to immovable property. Reverse charge will be applicable if service provider (i.e. contractor) is individual, HUF, partnership firm and service receiver is body corporate. Liability to pay service tax under reverse charge in case of work contract service is 50% on service receiver and 50% on service provider---…Notification 30/2012-ST. As in instant case you have not clarified the status of service provider and service receiver, therefore we assume that reverse charge is applicable in instant case. As discussed above that the service tax is leviable on 60% of gross amount. 50% liability out of total tax will be on service receiver. Therefore, amount to be deposited service receiver on advance will as follows:- [100 X 60% X 12.36% X50%] = 3.708 You have said that the service receiver is deducting the service tax. But this is not to be deducted. You will charge your portion of service tax, if any in your invoice and deposit the same with the exchequer. The service recipient will calculate his portion of service tax and deposit the same with the Government. Hence, there is no question of deduction of service tax from you.
My client is running a photo processing colour lab(no photo taking only processing-printing photos). He purchses a new printing machine for photo printing. The input is photos given by studios, individuals etc., in CDs, Pendrive or even via internet. We are printing the photos using HP machine. No chemicals are used. What we are doing is only printing photos and documents using inkjet macine with various media.These photos are binded and making albums and given back to the customer. Please advise this activity attracts service tax. P.J.Joseph (Posted On: 28 Oct, 2012)

As per Sl. No. 30 of Notification 25/2012-ST, “30(a) Carrying out an intermediate production process as job work in relation to agriculture, printing or textile processing is exempt” The exemption is applicable to printing process but in instant case there is additional process of binding and making albums is also done by the service provider. Therefore now question arise whether the service in instant case is exempt under above clause as printing process? As per section 66F (3):- “‘(a) If various elements of a bundled service are naturally bundled in the ordinary course of business, it shall be treated as provision of a single service which gives such bundle its essential character” The above provision will apply here in instant case as the service are naturally bundled in ordinary course of business and printing process gives it bundle character. Therefore it is treated as single service i.e. printing. As the service is treated as printing service therefore it is exempt under sl. No. 30(a) of mega exemption notification 25/2012-ST as discussed above.
rent paid to an individual by a company in excess of 12lakh per annum does it attract servicetax s.ramamurthy (Posted On: 27 Oct, 2012)

You have not clarified what kind of rent has paid, we assume that it is for immovable property. Negative list given under 66D exempts following services relating to immovable property:- “(m). Services by way of renting of residential dwelling for use as residence; (d). Renting of vacant land, with or without a structure incidental to its use, relating to agriculture.” If your service is covered in above clause then it will be exempt. Otherwise:- There may be two conditions:- 1. Assessee availing SSI exemption under Notification 33/2012-ST will be eligible for Rs. 10 Lakh provided all the terms and conditions of this notification are fulfilled. 2. Assessee not availing SSI:- Service tax from beginning i.e. no value based exemption will available and service tax will be leviable on whole amount.
Sir, I have sent a querry about the exemption limit of Rs. 10.00 LAKH AND ENQUIRED WHETHER THIS EXEMPTION IS APPLICABLE FOR US ALTHOUGH WE ARE SERVICE RECEPIENT FOR TRANSPORTATION OF GOODS BY ROAD ; KINDLY HELP ME SIR Unnikrishna Menonj (Posted On: 26 Oct, 2012)

We have already answered your query and once again answering the same. According to Notification No. 33/2012-ST, SSI exemption is not available to: “(ii) Such value of taxable services in respect of which service tax shall be paid by such person and in such manner as specified under sub-section (2) of section 68 of the said Finance Act read with Service Tax Rules,1994 (i.e. payment of service tax under reverse charge mechanism)”. Since your case is covered under sub-section (2) of section 68 of the said Finance Act i.e. person liable under reverse charge so the SSI exemption is not available.
In the new ST3 format for April to June 2012 after filling up and validating the whole return when submitted one message appeared that a file has been created at C Documents but I coukld not locate the file for uploading; is there any easy way to brose and reach the data file saved ???? Kindly help me sir, Unnikrishna Menonj (Posted On: 26 Oct, 2012)

First you should download the XML file and save the same at Desktop and then fill data. At time of validation i.e. “validate return and submit” then the new file will be generated by the ACES system at desktop. At the time of generation of new file write the file name completely on a paper then search the same at time of uploading. The format of name of new file will as under:- “Registration No._Date&Time” you can easily search by this name.
IF CENTRAL EXCISE INVOICE IS CANCELLED DUE TO SOME CLERICAL ERROR ON INVOICE, THEN WHETHER WE HAVE TO INTIMATE THE SAME TO DEPARTMENT OR NOT, IF YES UNDER WHICH PROVISIONS PLEASE GUILE CA ANAL MAROTI (Posted On: 24 Oct, 2012)

As per Chapter IV of Supplementary Instruction 2005of CBEC’s Excise Manual:----- When an assessee is compelled to cancel invoice, the following actions should be taken:- 1. Intimation of a cancelled invoice should be sent to the range Superintendent on the same date, whenever possible. However, in case of exceptional circumstances beyond the control of assessee should this not be possible, the intimation should be sent on the next working day; 2. Along with the intimation of the cancelled invoice sent to the range Superintendent the original copy of the cancelled invoice should also be sent. 3. Triplicate copy of the cancelled invoice may be retained by the assessee in the invoice book so that the same can be produced whenever required by audit parties, preventive parties and other visiting officers.
Sir, We Lost original Invoice of Service Provider,Tell me what is the procedure of taking cenvat credit of service tax on the basis of duplicate copy of invoice and whether any approval of Central Excise Officer is required or not. Hitesh karwa (Posted On: 24 Oct, 2012)

As per rule 9(1) of Cenvat credit rules 2004, the Cenvat credit shall be taken by the provider of output service on the basis of “(f) an invoice, bill or challan of input service”. The above rule mandates invoice, bill or challan for taking credit of input services. However there are many cases in which it is held that Cenvat credit can’t be disallowed only on technical ground that original document is not there but burden to prove that service is received will be on assessee. But you can’t avail Cenvat Credit straightway and you must apply to Jurisdiction officer and produce acceptable proof in order to satisfy him that service is actually received.
sir pl let us know whether the service charge will be levied or not,on the demurrage amount accrued on wagons containing chemical manures or agricultural produce like commodities which has been exempted from levying of service tax. thanks sukhjit singh (Posted On: 20 Oct, 2012)

As Rule 6(1) of the Valuation Rules, the following must be included in value of service:- “(x) the amount realized as demurrage or by any other name whatever called for the provision of service beyond the period originally contracted or in any other manner relatable to the provision of service” Further the exemptions given in mega exemption notification is for 25/2012-ST is for transportation of agriculture produce by rail and not for demurrage as demurrage charges is separate from transportation service.
Dear Sir, Kindly give your views on the service tax issue: We, a CA firm, undertake unit inspection and stock audits of borrowers on behalf of a bank. As per Notification No.45/2012 dated 7.8.12 which is adding additional list of services under RCM vide notification No.30/2012 dt 20.6.12. As per the Notification in Sl.No. 8, in the entries under the heading ‘Description of a service’, after the words “manpower for any purpose”, the words “or security services” ha been be inserted. The definition of Security services has been inserted vide Notification No. 46/2012-ST dated 7-8-2012 as Rule 2(1)(fa) of Service Tax Rules, 1994 which is given below: "Security services" means services relating to the security of any property, whether movable or immovable, or of any person, in any manner and includes the services of investigation, detection or verification, of any fact or activity. In view of the above now the bank is asking us to raise bill under RCM basis of 25:75. Kindly give your views. CA. R. Velu (Posted On: 20 Oct, 2012)

“(fa) “security services” means services relating to the security of any property, whether imovable or immovable, or of any person, in any manner and includes the services of investigation, detection or verification, of any fact or activity;” The above definition covers security of any property, in any manner and also includes investigation, detection or verification of any fact or activity. Therefore this definition is very wide and inspection of stock or stock audit will also be covered this definition and accordingly reverse charge will be applicable.
We have engaged manufacturing paper and paper board our major raw material is wood,bamboo etc. for procurement of raw material we do planttation of plants and we also give clone to farmers and later on we received wood from farmers. My question is all the activity is considered related to agriculture ? shelendra (Posted On: 20 Oct, 2012)

Agriculture’ has been defined in the Act as cultivation of plants and rearing or breeding of animals and other species of life forms for foods, fibre, fuel, raw materials or other similar products but does not include rearing of horses. In the instant case upto plantation it will be covered under “agriculture activity” and subsequent activity of making paper and paper board will not be treated as agriculture activity and will be treated as “manufacturing activity” and will leviable to excise. Hence no service tax will be applicable.
A company is having annual maintenance contract in which the contractor sometimes has to replace faulty hardware by new one. Will this contract fall under reverse charge mechanism. Jilesh (Posted On: 19 Oct, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” As in instant case transfer of material involved for maintenance, therefore it will be work contract service. Hence it will fall under Reverse charge mechanism provided all other conditions are satisfied.
whether service tax is applicable on complimentary services provide by hotel to guest at free of cost? Navin Jain (Posted On: 19 Oct, 2012)

Complimentary services are free of cost and part of main service. As per definition of ‘service’ given under clause 44 of section 65B “Service means any activity carried out by a person for another for consideration”. For complementary service, there is no separate consideration involved in addition to main service. Therefore, no service tax will be leviable and it will be treated as part of main service only.
Is there any circular or Notification forthcoming which mandates that after crossing the turnover limit of Rs. 9 Lakhs the service provider has to apply within 30 days for service tax registration??? Manoj Khatri (Posted On: 19 Oct, 2012)

Original Notification No. 26/2005-ST as amended by 05/2007-ST and 09/2008-ST. As per this notification “any provider of taxable service whose aggregate value of taxable service in a financial year exceeds Nine lakh rupees” shall make an application for registration under the provisions of sub-section (2) of section 69 of the Finance Act, 1994.
Dear Sir,Greeting of the Day My query is regarding availment of credit. can we take credit of input services (e.g. hiring of Manpower, Advertisement Etc.) against any output service (e.g. renting or commissioning services). Actually we are engaged in providing exempted services but we are also registered under service tax for providing renting and commissioning services. can we take credit against these services by manpower hiring services or advertisement prior to 01st July , 2012 anuj (Posted On: 18 Oct, 2012)

As per Rule 2(l) of Cenvat Credit Rules, 2004 “(i) input service means any service used by a provider of output service for providing an output service”. Further as per Rule 6(1) of Cenvat Credit Rules, 2004, Cenvat credit of input service used for providing exempted services shall not be allowed. Therefore if the services input services e.g. hiring of Manpower, Advertisement are not used for providing taxable services then Cenvat will not be allowed. But if these services are used for providing both exempted as well as taxable services then Rule 6(2) and Rule 6(3) will be apply. As per these rules, where provider of output service avails of Cenvat Credit in respect of common input services and provides taxable as well as exempted output services, then provider of output shall maintain separate accounts for inputs and input services used in exempted and taxable services. Cenvat credit shall be allowed on input services used for providing taxable services. Further Rule 6(3) will apply when provider of output service opting not to maintain separate records. As per this rule, you can do proportionate reversal as per formula prescribed or you can reverse @ 6% on the value of exempted services.
If my value of Works Contract is Rs.1000 (Material 400 + Labour 600). Can we pay service tax on total Rs.1000 and claim excise credit of input goods or is it compulsory to follow 2A of the Valuation Rules??? Manoj Khatri Advocate Manoj Khatri (Posted On: 17 Oct, 2012)

Firstly it is clarified that determination of work contract service is done according to Service Tax (Determination of Value) Rules, 2006, not from abatement notification and therefore it is mandatory. Service portion of Work contract should be determined as per Rule 2A of Determination Rules. Further as per Explanation 2 of Rule 2A of Service Tax (Determination of Value) Rules, 2006, “For the removal of doubts, it is clarified that the provider of taxable service shall not take CENVAT credit of duties or cess paid on any inputs, used in or in relation to the said works contract, under the provisions of CENVAT Credit Rules, 2004.” Therefore assessee is eligible to take Cenvat credit of Inputs used for work contract service.
A new building construction is being carried on. Electrical contractor does the internal wiring for this building. With reference to the work carried out by the Electrical Contractor, can the work by Electrical Contractor be treated as against "Original Works" and pay service tax on 40% of the total value of the Contract? Manoj Khatri Advocate Manoj Khatri (Posted On: 17 Oct, 2012)

It can’t be treated as original work and will be covered under clause (c) of Rule 2A(ii) i.e. 60%, because clause (c) specifically includes installation of electric fitting of immovable property therefore it is considered separately..
Dear sir, We have been to client for signing of Diesel Bills for payment States that since the vendor is not charging the service taxes on the bills we are not suppose to charge the Service taxes also on our Service Charges. Please clarify asap so that we could explain client . Mukesh Jha (Posted On: 17 Oct, 2012)

your query is not clear that what you want to ask?
Is reverse charge mechanism applicable to the cooperative housing societies. Samir Kapadia (Posted On: 16 Oct, 2012)

Yes, reverse charge can be applicable to the cooperative societies for example if service provider is goods transport agency and person liable to pay freight is cooperative society then reverse charge will applicable and liability to pay service tax will be on cooperative society. Another example:- if cooperative society receive services from abroad and service provider has not any establishment in India then reverse charge will applicable and cooperative society will be liable to pay service tax. For more detail refer notification no. 30/2012-ST at http://www.new.capradeepjain.com/redirect_amdview_5962_3
For Example, M/s A Ltd has taken on rent on hourly basis a Town Hall owned by Municipal Corporation. The said Town Hall is equipped with pre-fixed chairs, air-conditioners, projectors, pre fixed stage, washroom facilities & parking facilities. Further the infrastructure equipped with the Town Hall cannot be dissected from it and all such infrastructures are pre fixed. The rent charged by the municipal corporation is on hourly basis and there is no bifurcation of the charges for using such immovable property and other infrastructure. In more simple language it can be said that the said Town Hall cannot be rented without infrastructure embedded with it i.e. letting of one is not acceptable without letting of other. Now our questions are as follows; 1. Can it be classified as Infrastructure Support Service as distinguished from Renting of Immovable property service? 2. Who is the person liable for service tax in respect of the transaction enumerated hereinabove? Ajay Karia (Posted On: 16 Oct, 2012)

No it can’t be treated as Infrastructural Support service and it is just only renting of immovable property service. The reverse will also not applicable herein as sl. no. 6 of Notification No. 30/2012-ST(in respect of services provided or agreed to be provided by Government or local authority by way of support services) excludes “renting of immovable service”. Therefore Municipal Corporation will be liable to pay service tax. Even if it is termed as two different activities viz. renting of town Hall and other is infrastructure services. These are naturally bundled services. Now, the service which gives color to these bundled services will be classified under that category. Since the renting of immovable is the main service as the person comes for taking Town Hall on rent. Hence the service tax is payable under Renting of immovable property.
What are the new provisions of Clubbing under Excise. We have 2 firms with common partners where each firm is below the excisable limits. CA. R. Velu (Posted On: 16 Oct, 2012)

There is no state forward rule for clubbing of clearance. The grounds on which clearance value is normally clubbed are absence of independent existence of manufacturing unit, lack of machinery or facilities for the entire manufacturing process and interdependence or interrelationship of units with financial and/ or management control being exercised by one unit or its owner over the other. The question whether different partnerships having common partners are treatable as separate manufacturers or the same manufacturer, would be a question of fact in each case to be determined on the basis of such factors among other, like composition of the partnership, existence of the factory, licence, nature of goods manufactured etc.
Sir, Some transporters are still using the old format of service tax like "ST/CENT/SE01/GTA/32/2005/XXXX/XX/0X/0X" and "GTR/MI/XXX", so Can we take input credit on this bills? Tkanks joseph (Posted On: 16 Oct, 2012)

According to Rule 4A of Service Tax Rules 1994, provider of output service shall issue invoice, bill or challan and the such invoice, bill or challan shall contain registration number. Currently PAN based registration no. is mandatory. Therefore invoice should contain PAN based registration number. However there is many case laws wherein it has held that Cenvat Credit can’t be denied only on such technical mistakes.
is service tax applicable on construction work of gujrat tourism board done by contracctor . like development of lake,construction of entrance gate of hill station,costruction of tourist information centre , development of heritage station. vedraj agarwal (Posted On: 10 Oct, 2012)

As per sl. No. 12 of Mega exemption notification no. 25/2012-ST, following is exempt from service tax:- “12. Services provided to the Government, a local authority or a governmental authority by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of - (a) a civil structure or any other original works meant predominantly for use other than for commerce, industry, or any other business or profession” The essential characteristics of above exemption are as follows with comparing facts of instant case:- 1. Service should be provided to Government, a local authority or a governmental authority:- Here government includes Central Government as well as state government:- See whether Gujarat Tourism Board is part of State government or not. 2. There should be construction of civil structure or any other work which is predominantly use other than for commerce, industry, or any other business or profession:- See whether the construction work of Gujarat is for commerce, industry, or any other business or profession purpose. So if Gujarat tourism board is treated as part of state government and the construction work is not for the purpose of commerce, industry, or any other business or profession purpose then it will be covered under the above exemption otherwise will be taxable.
Sir Please clarifying which tax is applicable on printing and designing of magzines of our institute. vishal (Posted On: 10 Oct, 2012)

As per serial No. of Notification 25/2012-ST following service is exempts: “Carrying out an intermediate production process as job work in relation to- (a) Agriculture, printing or textile processing as job work” So the service tax will not be leviable as it is exempt under the notification No. 25/2012-ST. Further as told in query that you have not providing any material, hence it is not job work but a sale of good. Hence, no service tax is payable.
Sir, may you please guide on the issue in respect of value of the material utilised during the construction or repairing and hence deducted under noti 12/2003 in the light of the recent deicion of Aggarwal Colour (larger betch). Thanks CA B R Oza (Posted On: 10 Oct, 2012)

It is clarified that Notification No. 12/2003-ST has been deleted and it has ineffective from 01.07.2012. The Larger bench of the Hon’ble Tribunal has held in the case of Agrawal Colour Advance Photo System Vs CCE, Bhopal (2011-TIOL-1208-CESTAT-DEL-LB) that as per notification 12/2003 ST, the value of “deemed sale” cannot be excluded for the purpose of levy of service tax and in the absence of definition of the term “sale” in the Finance Act, 1994, only the definition of the term under Central Excise Act, 1944 should be referred to, which, according to the Tribunal, does not cover such deemed sale. By introducing negative list concept from 01.07.2012, definition of the term “service” has been given and the effect of the said decision has been nullified.
Sir,Under renting of immovable property service,municipal tax paid is to be reduced from the rent recd.what about service tax collected on the rent on monthly basis.Can it be retained by the land lord or is to be passed on to the tenenant.pl clarify with reasons.Regards venkat (Posted On: 10 Oct, 2012)

1. If property tax is already paid:- As per Notification 29/2012-ST---- “Provided further that wherever the period for which property tax paid is different from the period for which service tax is paid or payable, property tax proportionate to the period for which service tax is paid or payable shall be calculated and the amount so calculated shall be excluded from the gross amount charged for renting of the immovable property for the said period, for the purposes of levy of service tax” i.e. if property tax is paid for whole the year and rent is collected on monthly basis then proportionate amount related to that month will be adjusted for calculation of service tax of that month. 2. If property taxes are paid subsequent to the payment of service tax (i.e. property tax to be paid on annualize basis at the end of year):- In such cases, the property taxes paid can be adjusted while arriving at the service tax liability for the future in accordance with Rule 6(4c) of the Service Tax Rules, 1994. Further the claim can be made within one year from the date of payment of the property tax. The details of such adjustment shall be intimated to the concerned Superintendent of Central Excise in writing within 15 days of such adjustment.
I have been a registered dealer for VAT in Maharashtra since 2005. The sales/business activity continued till June 2009. Now I want to deregister. Can you please tell me the procedure for deregistration. S V Lalye (Posted On: 09 Oct, 2012)

Query is related to VAT and we do not deal in VAT.
In hotel Industry, suppose we have booked the room against advance payment of Rs. 10000 and service tax of Rs. 582 (50% Abatement on Room Rent) has been deposited on adavnce payment. Rs. 10000 is forfeited due to cancellation of room booking. From 01.04.2012 service tax is also applicable on advances forfeited for cancellation of an agreement to provide a service, now my question is whether hotel is liable to pay service tax 12.36% on forfeited amount or liable to pay service tax under abatement scheme? NAVIN JAIN (Posted On: 09 Oct, 2012)

The advance is received towards renting of room and amount is forfeited because of cancellation of agreement towards renting of room and also service tax have collected on 50% amount from service receiver. Further there is no any service provided separately and consideration is only for renting of room service. Therefore it is nothing and only renting of room service. Hence service tax will be leviable on 50% amount only.
Sir, we are company undertaking works contract services,after 1 st july 2012 can we charge the service tax on the full value of contract @ 12.36% and take cenvat credit on Inputs, Input Servies. (Posted On: 08 Oct, 2012)

Firstly it is clarified that determination of work contract service is done according to Service Tax (Determination of Value) Rules, 2006, not from abatement notification and therefore it is mandatory. Service portion of Work contract should be determined as per Rule 2A of Determination Rules. Further as per Explanation 2 of Rule 2A of Service Tax (Determination of Value) Rules, 2006, “For the removal of doubts, it is clarified that the provider of taxable service shall not take CENVAT credit of duties or cess paid on any inputs, used in or in relation to the said works contract, under the provisions of CENVAT Credit Rules, 2004.”.
whether service tax is levied on Xerox work under work contract service Rahul (Posted On: 08 Oct, 2012)

As per Sl. No. 30 of Notification 25/2012-ST, “30(a) Carrying out an intermediate production process as job work in relation to agriculture, printing or textile processing is exempt” Therefore service tax is not leviable on Xerox as it is nothing and printing process only.
The service provider of rent on immovable property died in sept, 2011. What is his liability with regard to rent from immovable property before his death and after his death? Arjun Sharma (Posted On: 08 Oct, 2012)

There is no separate provision in this regard. If there is any pending liability then legal heir of service provider will be liable for the same and thereafter if contract is continued then legal heir himself will service provider and liable for service tax.
our company procures manufactured products and pays excise duty on it. It Uses these products on composite works contract( material + service) and collects service tax from its client. Can service output liabilty be adjusted from excise duty( cenvat credit.??? Navin Jain (Posted On: 06 Oct, 2012)

As per explanation given with Rule 2A of Service tax Rules for Determination of value of service portion in the execution of a works contract(Notification 24/2012-ST):- “Explanation 2.--For the removal of doubts, it is clarified that the provider of taxable service shall not take CENVAT credit of duties or cess paid on any inputs, used in or in relation to the said works contract, under the provisions of CENVAT Credit Rules, 2004.” So the above explanation make it clear that provider of work contract service is not eligible to take Cenvat of ‘Input’ used in or in relation to the said work contract. For more detail refer notification no. 24/2012-ST at:- http://new.capradeepjain.com/redirect_amdview_5924_3
Message in the ACES says it will take time for arranging the new ST-3 format for filing returns. Also refer to Noti.No.47/2012-ST which says "provided that the Form ST-3 required to be submitted by the 25th day of October, 2012 shall cover the period between 1st April to 30th June, 2012 only". This has some ambiguity; doubt arise (1) what about July to Sept period (2) If Quarterly return is going to come, then why can't both quarters ST-3 be filed. Kindly throw some light on the subject Sir. Regards... Menon Unnikrishna Menonj (Posted On: 06 Oct, 2012)

The last date of filing of return for the period from April to September 2012 is October 25, 2012. The date of filing of return for the period from July to September is not notified yet. The number of changes has been made by negative list regime. But these are not incorporated in the returns. Hence this amendment has come. Even the return for the period April to June cannot be filed as the ACES site says that it is incorporating the changes and it will take few weeks. Please take up this matter with the association that there is a gap is between CBEC and software company ACES and they are not able to incorporate the changes. But the poor service providers have to repent for the same. They have to file two returns as well as that too on last days only.
Dear Sir, Kindly let me know if we sale handicraft item so shall we charge services tax & vat on handicraft items (like marble sculptures). We will have to pay services tax & vat to government? RENU SINGH (Posted On: 05 Oct, 2012)

your query is not clear. There is no service tax on sale of goods.
hlo sir. plz tl me whethr shops given on rent by religious body attracts service tax before & aftr budgt. shops on rents are givn to diffrnt persns doing diffret business i.e garments, kitchn, electronics etc sunil mehla (Posted On: 04 Oct, 2012)

Before Budget:- It was not taxable, as the definition of renting of immovable property given under (90a) of section 65 had excluded:- “(i) renting of immovable property given by a religious body or to a religious body” After Budget:- Taxable, as neither covered under Negative list given u/s 66D nor under Mega Exemption Notification No. 25/2012-ST.
Please advise whether a unit holding S.S.I. registeration certificate and manufacturing chewing tobacco bearing own brand name falling under chapter heading 24039910 will be entitled to small scale exemption of Rs. 1.50 crores (General exemption no. 1, notification no. 8/2003 of central excise dt. 01.03.2003 as amended. CA J. K. Choudhary (Mumbai) (Posted On: 03 Oct, 2012)

Annexure of Notification 08/2003- CE dated 1/03/2003 prescribes the description of goods to which SSI exemption is available. As per this annexure, All goods specified in the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985, other than specified in the annexure will be eligible for SSI exemption. Sl. No. (iv) specify the following description of goods which is not eligible for SSI exemption:- “(iv) all goods falling under Chapter 24 of the said First Schedule (other than unbranded chewing tobacco, preparations containing chewing tobacco and tobacco extracts and essences, falling under heading No. 24.04 )” The above sl. No. (iv) makes it clear that all goods of Chapter 24 is not eligible for SSI exemption but unbranded tobacco is eligible for SSI exemption. As in instance case there is manufacturing of chewing tobacco falling under chapter 24 which have brand name therefore SSI exemption will not be available.
NOTIFICATION NO 33 DATED 9.7.12 questions remain on whether the goods cleared without duty payment but upon debit to duty credit scrips should be treated as duty paid or exempted ' KINDLY CLARIFY DILIP SHAH DILIP SHAH (Posted On: 02 Oct, 2012)

This excise notification is for import under SHIS scheme. Further, it will be treated as duty paid only. As per Clause (l) of notification, the importer is eligible for cenvat credit also of the amount debited in this scrip.
sir, my question is if we have received the service upto 30.06.12 and bill dated is 07.07.12 and we have made the payment after bill date then have we to pay reverse charge as it is applicable wef 01.07.12 SACHIN GOYAL (Posted On: 02 Oct, 2012)

Reverse charge will be applicable if point of taxation under POT Rules (here POT Rule for reverse charge is not considered) is after 30.06.2012. Firstly you have not provided information completely i.e. which service involved. As per Rule 3 of POT Rules, when invoice is issued within the stipulated time(30 days) and no payment is received before the time of issue of invoice, POT will be ‘Time of Issue of Invoice’. Rule 4 of Point of taxation rules:- In case there is change effective rate (including change in abatement also):--- When service has been provided before change in effective rate of tax, invoice is issued after such change and also payment is received after the change then point of taxation will be ‘date of payment or date of issuing invoice whichever is earlier’. As you are not provided description of service and Rule 4 of POP applicable also when abatement rate is changed or any other change in effective rate so you have to see what Rule will be applicable in your case. However in both the case POT will be ‘date of issue of invoice’ i.e. 07.07.2012. As POT is after 30.06.2012 therefore reverse charge will be applicable. As the reverse charge is applicable so now the POT for receiver liable under reverse charge will be determine as per Rule 7 of POT i.e. POT will be Date of Payment.
Food supply by the contractor at the factory for lunch etc for employees at factory premises , weather Abatement of 40% allows or not ajay jain - (Posted On: 02 Oct, 2012)

Yes abatement of 40% will be allowed. When supply of food involved for outdoor catering, valuation Rule 2C will be applicable which is as follows:- “Service portion in outdoor catering wherein goods, being food or any other article of human consumption or any drink(whether or not intoxicating) is supplied in any manner as a part of such outdoor catering :- 60% of Total amount”. However, firstly you should see whether this activity falls under negative list or mega exemption notification. If it falls under the same, then there is no service tax at all.
Sir, whether wef april 2011 under the amended rule 2(l) of Cenvat credit Rules, 2004 , the service tax paid on (a) rent paid for factory or an office, (b)overriding commission paid to dealers, (c)sales commission paid, (d) annual maintenance contract service given to customers (either by the manufacturer or his dealers), (e) courier, (f)tours & travels, (g)rent a cab, (h)factory bus service, (i)factory canteen service eligible for cenvat credit for the manufacturer suresh makhijaney (Posted On: 02 Oct, 2012)

The services mentioned in your query will be eligible for Cenvat credit if it satisfy the definition of input service given under Rule 2(l) of CCR. Hence, you have to decide in the context of your unit.
can a assessee can clain of credit of input service tax if he avail abatment antima jain (Posted On: 01 Oct, 2012)

It depend’s upon the conditions of abatement(given under respective notifications i.e. Notification No. 26/2012-ST) that whether the credit of input service is available or not. For example there is no conditions in case of abatement taken under ‘Services in relation to financial leasing including hire purchase’. Whereas in case of ‘services by way of renting of hotel meant for residential or lodging purposes’ the CENVAT credit on inputs and capital goods, used for providing such taxable service, is not allowed but credit of input service is allowed for the same. So it depends upon the type of service being provided, as you have not mentioned the type of service being provided, it is difficult for us to give the specific answer. You’ll have to see the type of service in question and then corresponding conditions given in the Notification. For more detail see notification no. 26/2012-ST at http://new.capradeepjain.com/redirect_amdview_5958_3
We are hiring cold storages from individual and from private limited companies for storing our food product produced by us. kindly suggest is service tax applicable on rent paid by us for cold storages??? Manoj Khatri (Posted On: 01 Oct, 2012)

Yes, service tax will be leviable as neither covered under Negative list (section 66D) nor under Mega exemption Notification 25/2012-ST.(ST will not applicable if there is storage of an agricultural produce)
Dear Sir, I need your expert guidance on the following query: A company has liability to pay under Reverse Charge Mechanism. Can the company take credit for Service Tax Paid for financial services against liability under reverse charge mechanism i.e. can the company adjust the service tax paid on financial services against payment liability under Reverse Charge Mechanism. KULBHUSHAN LAL, FCA (Posted On: 01 Oct, 2012)

The liability of service receiver under reverse charge mechanism is for Input services only. Secondly, input service (financial service) can’t be used for payment of liability of another input service under reverse charge mechanism. Even input service means “services used by provider of service for providing output services”. Hence input service can only be used for payment of liability of output service only not for input service. Even there is amendment that the payment under reverse charge is to be paid in cash only.
Sir, please advice whether service tax is applicable on demurrage collected by port railway from consignors on account of exceeding free period allowed for unloading of wagons? patne purnima - paurnimakiran@gmail.com (Posted On: 01 Oct, 2012)

As Rule 6(1) of the Valuation Rules, the following must be included in value of service:- “(x) the amount realized as demurrage or by any other name whatever called for the provision of service beyond the period originally contracted or in any other manner relatable to the provision of service” So service tax will be applicable on demurrage.
If a service provider is able to exclude the value of materials on which he pays VAT @ 5 or 14.5, he has to charge service tax on value of service. Whether this can be treated as one contract for sale of materials which is trading and is excluded as per negative list and balance as a service contract and charge ST @ 12.36? Or it has to be classified as WCT under Clause(i)of Rule 2A? Whether reverse charge will apply for this if Service provider is Ind or HUF or Firm or AOP.? Bharath Kumar (Posted On: 30 Sep, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” It may possible that service provider is able to segregate the material value and service value but still it will covered under work contract service if it satisfy the above definition i.e. there is transfer of material. Secondly, it will be for the type of service specified in this definition. When the activity is covered under “work contract service” then valuation Rule 2A of Service Tax (Determination of Value) Rules, 2006 will apply and according to this rule:- “(i) Value of service portion in the execution of a works contract shall be equivalent to the gross amount charged for the works contract less the value of property in goods transferred in the execution of the said works contract.” So ultimately service tax will be leviable on service portion under work contract service if service provider is able to segregate the value of material supplied. Further if activity is covered under work contract service, reverse charge will apply if service provider is Proprietor, Partnership, HUF or AOP and service receiver is body corporate.
Dear Sir, Please clarify the amount agreed to be paid as labour charges to electrican, plumber, technician of fax m/c, DG set will it fall under manpower supply? AK Gaur atul gaur - atulgaur_67@rediffmail.com (Posted On: 29 Sep, 2012)

Rule 2(g) of Service Tax Rule, 1944 defines supply of manpower to means:- “supply of manpower temporarily or otherwise to another person under his superintendence or control” So the essential character of manpower supply service is that the manpower should work under the superintendence or control of service receiver. As electrician, technician or plumber normally provides services independently and not supply any manpower which work under supervision of service recipient, hence it is not manpower supply service. But you have to assess on the basis on agreement on hand.
D/Sir, Annual maintenance charges of desktop/ printer has covered under work contract service where contractor also charging VAT. Kindly confirm.... Nitesh Kumar (Posted On: 29 Sep, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” As you are saying that contractor is charging VAT, it means there is supply of material involved for execution of repairs hence the service is covered under the above definition of ‘work contract service’.
We are registered as a Service receiver for Transportation By Road and have been making remittance of Service Tax In A/c Code No 00440262 . Are we to make remittances from 1st July 2012 onwards in the new All Taxable Services code : 00441089 ??. Kindly guide me Sir. With Regards Unnikrishna Menonj (Posted On: 29 Sep, 2012)

Yes, from 1st July 2012 you are suppose to make all the remittances related to service tax payable in Accounting Code 00441089. As per Circular No.161/12/2012 –ST accounting codes for the purpose of payment of service tax under the Negative List approach, with effect from 1st July, 2012 and common for all the services, is as follows: Basic Service tax: 00441089 Primary Education Cess: 00440298 Secondary and Higher Education Cess: 00440426
Hello, Kindly let me know the service tax rate applicable for sole proprietorship or for women entrepreneur Regards, Anu Anupama Krishnan (Posted On: 26 Sep, 2012)

In terms of the charging provisions contained in Section 66B, service tax is levied @ 12.36% on the value of taxable services. Irrelevant of the nature of concern or owner’s identity (whether male/female) rate of service tax applicable will be same for all. However there are some services which cover under the definition of ‘Service’ but are exempt from payment of service tax but that depend upon the nature of service provided.
when we sold capital golds where we have show excise duty of the capital goods in ER-1 Return. Please advice savita mishra (Posted On: 26 Sep, 2012)

When Capital goods are sold, it is treated as “as such removed” so its duty should be reversed. In ER-1 under point no. 5 (Details o Cenvat Credit taken and utilized) it is to be shown in column of “credit utilized when capital goods are removed as such.
Is service tax payable by the authorised service centres on the commission earned on the insurance offered to the their customers. Tariq (Posted On: 26 Sep, 2012)

Under new concept of negative list, service tax will be leviable when an activity is covered under definition of ‘service’ and not covered under the negative list and mega exemption notification. ‘Service’ has been defined in clause (44) of the new section 65B and means – “any activity carried out by a person for another for consideration and includes a declared service.” Hence the above mentioned activity in query covers under the definition of Service. Further your activity is neither covered under Negative list nor under Mega exemption Notification 25/2012-ST therefore will service tax be leviable.
Sir, Whether curing of coffe beans on job work charges will attract Service Tax in the new Service Tax regime in view of the fact that plantation is also included as agriculture produce tks krishnas krishnadas (Posted On: 26 Sep, 2012)

The services relating to agriculture or agricultural produce that are specified in the Sl. No. (d) in the negative list are services relating to – • agricultural operations directly related to production of any agricultural produce including cultivation, harvesting, threshing, plant protection or seed testing; • supply of farm labour; • processes carried out at the agricultural farm including tending, pruning, cutting, harvesting, drying cleaning, trimming, sun drying, fumigating, curing, sorting, grading, cooling or bulk packaging and such like operations which do not alter essential characteristics of agricultural produce but makes it only marketable for the primary market; • renting of agro machinery or vacant land with or without a structure incidental to its use; • loading, unloading, packing, storage and warehousing of agricultural produce; • agricultural extension services; • services provided by any Agricultural Produce Marketing Committee or Board or services provided by commission agent for sale or purchase of agricultural produce; The activity ‘curing’ is covered under the 3rd sl. No. of above exemption but the essential character of this exemption is that “operations which do not alter essential characteristics of agricultural produce but makes it only marketable for the primary market”. If the process undertaken by you falls under above category (i.e. essential character of agriculture produce will not change), the service tax will not be applicable.
Sir, As per our contract, the client will deduct 10% amount from our RA Bill and release it after successfully completed of JOB. My Quaries are: 1. Whether the Service tax Will be charged on Gross Amount of Bill or After Deducting Retention amount? Regards, CMA Utpal Kumar Saha CMA Utpal Kumar Saha (Posted On: 26 Sep, 2012)

Service tax will be leviable on gross amount charged i.e. including retention charges because retention charges is also part of value of service. Morever, service tax is payable on invoice raised or payment received whichever is earlier. We have to pay the tax on complete invoice amount.
We are authorized service station service provider. we provide repairs and maintenance service to vehicles. my question is: 1. can we take cenvat credit of service tax paid on rent paid on workshop and showroom. 2. when we repair the vehicle we also use new/replace spares parts. how to charge service tax in our invoices? whether 2 separate bills to be raised? one for spares parts + vat and another for repairs + service tax. Please help. alfa (Posted On: 26 Sep, 2012)

1. As per Rule 2(l) of Cenvat Credit Rules, 2004 “(i) input service means any service used by a provider of output service for providing an output service”. Further the renting of immovable property is also not covered under any exclusion clause of definition of ‘input service’. As renting of workshop and showroom is an input service used for providing output service therefore Cenvat credit will be available. 2 & 3. Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” The above definition makes it clear when there is transfer of property in goods involved in execution of such contract, it will be work contract service. Further separate bill is raised or not it will still remain ‘work contract service’. As your service is covered under the definition of ‘work contract service’ therefore it’s treatment will be done as per Rule 2A of Service Tax (Determination of value) Rules, 2006. According to (i) of Rule 2A: “(i) Value of service portion in the execution of a works contract shall be equivalent to the gross amount charged for the works contract less the value of property in goods transferred in the execution of the said works contract” As in your case, the value can be determined according to above (i) i.e. value of material portion can be separated from gross amount charged, therefore this will be applicable and you can charge bill according to this Rule i.e. in the invoice, show the gross amount charged and then deduct the value of material supplied, then charge service tax on net amount (i.e. on service portion). For more detail you can refer Notification No. 24/2012-ST at following link:-- “http://www.new.capradeepjain.com/redirect_amdview_5924_3”
Respected Sir, whether builder(who pay service tax on 25% of total sale value)can availed CENVAT of inputs, input services & Capital Good used for construction ? Manoj Khatri (Posted On: 25 Sep, 2012)

As per conditions given under Sl. No. 12 of Notification 26/2012-ST :- “(i) CENVAT credit on inputs used for providing the taxable service has not been taken under the provisions of the CENVAT Credit Rules, 2004. (ii)The value of land is included in the amount charged from the service receiver” Hence service tax on input services and capital goods is allowed.
Whether the contract of making furniture, comes under purview works contract and if yes what is the rate under composition scheme?? Manoj Khatri (Posted On: 25 Sep, 2012)

1. If service provider uses his own material in job work and it relates to immovable i.e. fitting out:-It will be work contract service and service tax will be leviable on 70% of total value, if segregation of material potion and labour portion is not possible. [Rule 2A of Service Tax (Determination of value) Rules] 2. If service provider uses his own material and it relates to movable property :- If the process undertaken by job worker amount to manufacture then it will be exempt [sl. no. (f) of Negative List] 3. If service receiver provide material:- It will only labour contract and service tax will be leviable on @12.36% on total value.
Sir, Please provide practical illustration on Rule 3(5A) of CCR,2004 for removal of c. goods.it will applicable on only as such removal or all removal of C. goods after being used. yateenvyas (Posted On: 25 Sep, 2012)

Rule 3(5) is related to ‘as such removal of input or capital goods’ which is as follows:-- “(5) When inputs or capital goods, on which CENVAT credit has been taken, are removed as such from the factory, or premises of the provider of output service, the manufacturer of the final products or provider of output service, as the case may be, shall pay an amount equal to the credit availed in respect of such inputs or capital goods and such removal shall be made under the cover of an invoice referred to in rule 9” e.g. a machinery is purchased on 30th April and 50% credit of Rs. 5000 is taken immediately but machinery is removed as such on 2nd May without any use. Now according to the above the manufacturer or provider of output service is required to reverse an amount equal to credit availed i.e. Rs.5000. Rule 3(5A) is related to treatment when “capital goods are removed after being used”, which is as follows:-- “(5A) If the capital goods, on which CENVAT credit has been taken, are removed after being used, whether as capital goods or as scrap or waste, the manufacturer or provider of output services shall pay an amount equal to the CENVAT Credit taken on the said capital goods reduced by the percentage points calculated by straight line method as specified below for each quarter of a year or part thereof from the date of taking the CEVAT Credit, namely:- (a) for computers and computer peripherals: ---- for each quarter in the first year @ 10%, for each quarter in the second year @ 8%, for each quarter in the third year @ 5%, for each quarter in the fourth and fifth year @ 1%. (b) for capital goods, other than computers and computer peripherals @ 2.5% for each quarter: Provided that if the amount so calculated is less than the amount equal to the duty leviable on transaction value, the amount to be paid shall be equal to the duty leviable on transaction value.” The above can understand by following example:-- Suppose capital good (other than computer) of Rs. 50000 is purchased on 1st April 2011 and immediately taken 50% credit of Rs. 2575 (@10.3%) and remaining 50% of Rs. 2575 is credit taken on 1st April 2012 and capital goods is removed after being used on 15th Oct. 2012 at Rs. 40000. The above Rule 3(5A) will be applicable and manufacturer or output service provider will have to pay higher of following amount:-- [5150- (5150 x 2.5% x 6 Quarters) = 4377] or 40000*12.36% = 4944 For more detail you can refer Notification No. 18/2012-CE (N.T) at following link: --- “http://www.new.capradeepjain.com/redirect_amdview_5691_1”
Sir ji.. Pl. clarify, the service tax liability in case of sub-contractor, where the principal contractor is paying service tax. visu iyer (Posted On: 24 Sep, 2012)

The services provided by sub-contractor to contract will be taxable unless otherwise specified in Negative list as given under section 66D or under mega exemption notification 25/2012-ST. As per sl. No. 29(h) of mega exemption notification 25/2012-ST following service is exempt:-- “(h) sub-contractor providing services by way of works contract to another contractor providing works contract services which are exempt” Hence, if the main contractor providing the services of works contract is exempt then the subcontractor also providing services of works contract will also be exempt.
Sir ji... Here is a query on MRA services. supply of labour for a company located at Dubai. but Salary paid from India. In turn service charges receipt from Dubai company in foreign currency. a) what is the applicability of service tax liability in case dubai company is at FTZ (Free trade zone) b) in case dubai company is the associate enterprise. visu iyer (Posted On: 24 Sep, 2012)

Under Section 66B, a service is taxable only when, inter alia, it is “provided (or agreed to be provided) in the taxable territory”. Thus, the taxability of a service will be determined based on the “place of its provision”. If place of provision is taxable territory then service tax will be leviable otherwise not. As salary is paid from India, it means the service provider is located in India and supply the manpower to the company located at Dubai. As per Rule 3 of Place of Provision Rules, 2012 “Generally the place of provision of a service shall be the location of the recipient of service” i.e. if the service is not covered under any of specific rule of POP then Rule 3 will be apply. As you are saying that service is “manpower supply”, it means control and supervision of labour will be with service recipient. The manpower supply service is not covered under any of the specific rules of POP therefore basic Rule 3 will apply and place of provision will be ‘location of service receiver’ which is not in taxable territory hence service tax will not be applicable. There is no impact on taxability whether service receiver is in FTZ or associate enterprise.
Dear sir, a CA is a director in a company and the company is paying monthly fees to the proprietorship concern(CA)of the Director. Whether the payment made to the proprietorship concern attracts Service tax under Reverse charge mechanism?. I hope, if paid to CA proprietorship concern, it is not attracted, due to 1) a proprietorship concern is not a director of the company. 2. the payment is made in his professional capacity, not to carry any work of directorship, 3. The term "director" does not include his proprietor concerns(being a separate business entity) Am I correct?? Pls clarify NSS (Posted On: 24 Sep, 2012)

“In respect of services provided or agreed to be provided by a director of a company to the said company:----100% liability to pay service tax is on company under reverse charge mechanism”. The above provision makes it clear that 100% liability on company on services of director. Further service tax is levied on such services of directors which are not treated during the course of his employment e.g. renting of director’s building to company, services of independent or professional director etc. Chartered Accountant holding a valid certificate of practice, can act as a director of company provided he has taken specific permission as per code of ethics for CA. As you are saying that CA is working in his professional capacity as well, it means he is working as professional director and any payment made to a CA as a director or to his proprietorship concern shall be deemed to made to CA himself. The director and proprietor are one and same person. So any payment made to him will be covered under reverse charge mechanism.
Dear Sir, we have to deposit service tax under reverse charges on account of Legal Fees Services ( payment to advocate) i would like to know which accounting code will be applicable for depsoiting service tax ? Alok (Posted On: 22 Sep, 2012)

According to Circular No.161/12/2012 –ST accounting codes for the purpose of payment of service tax under the Negative List approach, with effect from 1st July, 2012 and common for all the services, is as follows: Basic Service tax: 00441089 Primary Education Cess: 00440298 Secondary and Higher Education Cess: 00440426
Sir, Annual maintenance charges of transmission lines is also covered under the electricity transmission or electricity distribution service or not ? Kindly get your valuable advice. Rashmi (Posted On: 22 Sep, 2012)

Section 66D specifies negative list of services and sub section (k) of Section 66D Covers following service. “Transmission or distribution of electricity by an electricity transmission or distribution utility” But your service is maintenance of transmission line towers, not transmission or distribution of electricity as mentioned in negative list and further the above exemption available to an electricity transmission or distribution utility. So service provided by way of maintenance of transmission line towers is a taxable service.
Sir, Indeed comments and thought provoking articles from you are very helpful. We are engaged in garden development and maintenance work. We have our own team of gardeners, supervisors and experts and take contracts to develop and maintain garden plants, trees, lawns, flowers, etc. Since July 2012 these type of services seem to be covered under service tax. Though a negative list has agriculture in it. Your expert comments would throw light on: Whether garden maintenance is covered under service tax? Thank you. Regards, Naresh Pancholi naresh pancholi (Posted On: 19 Sep, 2012)

Negative list given under section 66 exempts “services related to production of any agriculture or agricultural produce by way e.g. supply of farm labour, agricultural operations directly related to production of any agricultural produce etc. The exemption is available to agricultural related services and according to section 65B (3) “agriculture means the cultivation of plants and rearing of all life-forms of animals, except the rearing of horses, for food, fibre, fuel, raw material or other similar products” The garden maintenance is not a agricultural activity therefore will not be covered under the negative list, hence will be taxable.
Dear Sir, One of my client is providing web designing facilities to the companies involved in advertisement through internet. Whether the person providing services of web design or modules of advertisement on the net will be exempted? Wether the exemption can be claimed from FY 08-09? hetal (Posted On: 18 Sep, 2012)

Sl. No. (g) of negative list as given under section 66D exempts follows: “(g) selling of space or time slot for advertisements other than advertisement broadcast by radio and television” The above exemption will be available when there is service of selling of space or time slot but in your there is service of web designing for advertisement and not selling of space for advertisement. Further the service is not covered under any entry of mega exemption notification or under negative list therefore will be taxable.
sir, whether road construction in tourist complex will attract service tax under previous provisions and after new budget sunil mehla (Posted On: 17 Sep, 2012)

Under new negative list concept service tax will be leviable if activity is covered under the definition of ‘service’ as give under clause 44 of section 65B and not covered under Negative List and Mega Exemption Notification. “Service means any activity carried out by a person for another for consideration and includes declare services.” Your service i.e. construction of road is clearly covered under the above definition. Further Sl. No. 13 of Mega exemption notification 25/2012-ST exempts the following service: “13(a) Services provided by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of a road, bridge, tunnel, or terminal for road transportation for use by general public” The above exemption will be available when service is use by general public. The term General public is defined in Serial No. (q) of para 2 of notification 25/2012-ST dated 20.6.2012 as follows: “‘general public’ means the body of people at large sufficiently defined by some common quality of public or impersonal nature.” In this query it is not clarify that what type of tourist complex is there whether it is for general public or used by some specific person e.g. which purchase the ticket for this. So if the road is used by GENERAL Public, it will be exempt and if it is used by some specific community or section of persons, the exemption under this entry will not be available. For the earlier period, the exemption was available on road construction under “Commercial or industrial construction”.
A company is incorporated in 2011 from the date of incorporation the client has only service tax input but no output so he doesn't registered for Service tax and all the service tax input shown in profit & loss as an expense but in current year the company started charging service tax from his customer from June 2012 so he get registered for service tax in the month of June 2012.But question is whether company can take service tax input of the current year i.e., from April 2012 to set off with output or not? NAVIN JAIN (Posted On: 17 Sep, 2012)

The ‘input service’ means any service used by a provider of output service for providing an output service. This definition makes it clear that the service provider can take the credit of those services only which is used for providing output service. This is also supported by Rule 6 which says that the credit of input or input services used for exempted product or exempted service will not be allowed. Further the condition as given under small scale threshold exemption notification no. 33/2012-ST (threshold exemption) is as follows: “The provider of taxable service shall avail the CENVAT credit only on such input or input service received, on or after the date on which the service provider starts paying service tax, and used for the provision of taxable services for which service tax is payable” As your company started charging service tax from customer from June only, hence the above provision will apply. Thus, you can take the credit of services received on or after the date from which company has started charging service tax i.e. in June.
Whether there is no cenvat credit possible when the service provided is 'Renting of Immovable Property' Kindly clarify. kunal reshamwala (Posted On: 17 Sep, 2012)

Under negative list, every such activity which falls in the definition of “service” as given in clause 44 of section 65B of the Finance Act are taxable unless otherwise exempted. The exemptions to certain services have been given in the negative list and also in notification no. 25/2012-ST DT 20.6.12. The following exemptions are related to renting of immovable property services as given in negative list and mega exemption notification:- Under Negative list:- •At clause no. (m) of section 44:- Renting of residential dwelling for use as residence. Under mega exemption notification:- •At entry no. 5:- Renting of precincts of a religious place meant for general public. • At entry no. 9:- Services provided to or by an educational institution in respect of education exempted from service tax, by way of,- (a) auxiliary educational services; or (b) renting of immovable property; • At entry no. 18:- Renting of hotels, inn, guest house, club, campsite or other commercial places meant for residential or lodging purpose, having declared tariff of a room below rupees one thousand per day or equivalent is exempt. Since the above referred services are totally exempted under service tax law, no Cenvat Credit is available if the service provider is SOLELY providing these services. However, concept of declared service has also been introduced in the negative list era where certain activities are declared to be a service for the purpose of levying the service tax. The list of declared services has been prescribed in section 66E which reads as follows:- “66E. The following shall constitute declared services, namely:- (a) renting of immovable property; (b) construction of a complex, building, civil structure or a part thereof, including a complex or building intended for sale to a buyer, wholly or partly, except where the entire consideration is received after issuance of completion certificate by the competent authority. Explanation.- For the purposes of this clause,- (I) the expression "competent authority" means the Government or any authority authorised to issue completion certificate under any law for the time being in force and in case of non-requirement of such certificate from such authority, from any of the following, namely:- (A) architect registered with the Council of Architecture constituted under the Architects Act, 1972; or (20 of 1972.) (B) chartered engineer registered with the Institution of Engineers (India); or (C) licensed surveyor of the respective local body of the city or town or village or development or planning authority; (II) the expression "construction" includes additions, alterations, replacements or remodelling of any existing civil structure; (c) temporary transfer or permitting the use or enjoyment of any intellectual property right; (d) development, design, programming, customisation, adaptation, upgradation, enhancement, implementation of information technology software; (e) agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act; (f) transfer of goods by way of hiring, leasing, licensing or in any such manner without transfer of right to use such goods; (g) activities in relation to delivery of goods on hire purchase or any system of payment by installments; (h) service portion in the execution of a works contract; (i) service portion in an activity wherein goods, being food or any other article of human consumption or any drink (whether or not intoxicating) is supplied in any manner as a part of the activity.” Thus, the list of services prescribed under “Declared services” includes the “Renting of immovable property services”. Thus, all the types of renting of immovable property services are taxable undoubtedly other than those prescribed under negative list and mega exemption notification as discussed above. Further, Notification no. 26/2012-ST dated 20.6.2012 prescribes the abatement of 40% in case of "6. Renting of hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes." Thus, the abatement of 40% is allowed in case of renting of hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes. Further, where the abatement is claimed for these services, the credit is not allowed on ‘Inputs’ and ‘Capital goods’. As such, where these services are provided; the credit of “Input services” is allowed alongwith abatement. In respect of all the other types of immovable properties (which are taxable beyond any doubt by virtue of section 66E); the service tax is payable to the full applicable rates. Further, no specific prohibition has been imposed regarding the allowability of Cenvat Credit on these services. As such, we are of opinion that the Cenvat Credit is allowed on all the other types of renting of immovable property services. However, if the various types of immovable property services are provided, some exempted and some taxable, provisions of rule 6 of Cenvat Credit Rules, 2004 will apply accordingly. Lastly, in context of service tax by way of positive list, circular no. 98/1/2008-ST dated 4.1.2008 was issued regarding Cenvat Credit on renting of immovable property service. The relevant portion of this circular is as follows:- Reference Code- 096.01 / 04.01.08 Issue:- Commercial or industrial construction service [section 65(105)(zzq)] or works contract service [section 65(105)(zzzza)] is used for construction of an immovable property. Renting of an immovable property is leviable to service tax [section 65(105)(zzzz)]. Whether or not, commercial or industrial construction service or works contract service used for construction of an immovable property, could be treated as input service for the output service namely renting of immovable property service under the CENVAT Credit Rules, 2004? Clarification:- Right to use immovable property is leviable to service tax under renting of immovable property service. Commercial or industrial construction service or works contract service is an input service for the output namely immovable property. Immovable property is neither subjected to central excise duty nor to service tax. Input credit of service tax can be taken only if the output is a ‘service’ liable to service tax or a ‘goods’ liable to excise duty. Since immovable property is neither ‘service’ or ‘goods’ as referred to above, input credit cannot be taken. Thus, in the above referred circular, it was clarified that the credit on input services is not available if the services provided by the assessee are renting of immovable property services. However, now the immovable property has been specifically declared as taxable service under section 66E. Further no specific restriction has been imposed regarding the availment of Cenvat Credit on these services in context of negative list. Thus, we can say that the above circular will not hold good now under negative list scenario. We hope the above will satisfy your query. Disclaimer: This opinion is given to best of knowledge and belief. The service tax is a complicated law and interpretations of the law keep on changing based on judicial discipline and Board’s clarifications. Our opinion is also subject to the same.
i have property on rent for which i pay service tax i also own commercial vehicles can i claim service tax rebate on insurance premium on these vehicles raman kumar khosla (Posted On: 17 Sep, 2012)

As per Rule 2(l) of Cenvat Credit Rules, 2004 “(i) input service means any service used by a provider of output service for providing an output service”. It means credit of input services can only be available when input service is used for providing output service. As in your case input service i.e. insurance premium of vehicle is not used for providing output service i.e. renting of property, therefore credit can’t be taken. Also, the Cenvat credit on insurance of motor vehicle is allowed only when it falls under the definition of capital goods or to the manufacturer of motor vehicle.
Assessee entered a contract with UPPCL for repair of transformers using his own HV/LV leg coils and charges service tax on labour as per contract.The balance sheet reflects outward freight incurred on transportation of the same through his own regd truck.Please clarify whether service tax is payable on the freight charges which is not charges from his customers separately. Tariq (Posted On: 16 Sep, 2012)

According to section 66D following service is exempt:- “(p) Services by way of transportation of goods- (i) by road except the services of – (A) a goods transport agency; or (B) a courier agency” And according to section 65B: “(26) goods transport agency means any person who provides services in relation to transportation of goods by road and issues consignment note, by whatever name called.” So service tax is applicable when service is provided by a person covered under the above definition of GTA. In the instant case, when you are not goods transport agency who issues consignment note. You are using your own trucks for transportation. Hence the service tax on GTA is not applicable in the instant case.
Sir, we are having centralized registration of service tax at Mumbai. We are receiving GTA service at various C&F locations all over India. C&F agents make payment on our behalf as pure agent and later reimbursed by us. our query is should we register each c&f location under centralized registration for payment of service tax on GTA service when these locations are not our property. Raju (Posted On: 15 Sep, 2012)

No, you are not required to register in each location. Even according to rule 4(2)(ii) of Service Tax Rules, 1994:---- Where a person, liable for paying service tax in the case of taxable services, receive such service in more than one premises or offices, and has centralize billing or centralize accounting system, he may opt for centralized registration.
Dear Sir Hello !! Please take note of Rule 7C of Service Tax Rules, 1994, which prescribes the amount to be paid for delay in furnishing the prescribed return, subject to the maximum amount provided under Section 70 of the Finance Act, 1994. Now if we go to Section 70 of the Finance Act, 1994, it prescribed 20000/- rupees as the upper limit. Sir my question is that one of my assessee has late deposited two returns on the same day and as a late fee they have deposited only 20000/- rupees for both the returns. Would this amount be sufficient for both the returns or my assessee has to pay an additional sum of rupees 20000/- for second return, filed belatedly. Manoj Khatri Advocate Manoj Khatri (Posted On: 15 Sep, 2012)

According to section 70(1), “where returns are filled after due date, late fees not exceeding Rs. 20000(w.e.f. 08.04.11) is payable for delayed filling of return”. It is mentioned that the delay filing of return and not delay filing of returns. Hence it will be for each return.
Sir, My doubr is whether Entity being Trust under section 12 of IT , is liable to reverse charge mechanism of srvice tax? as a service recipient? ( Entity is not registered under service tax ) manjur alad (Posted On: 15 Sep, 2012)

With reference to point no. 4 of Service tax Notification No. 25/2012 dated 20 June’ 2012 Service Tax is exempt on “4. Services by an entity registered under section 12AA of the Income tax Act, 1961 (43 of 1961) by way of charitable activities” The above exemption is available when service is provided by entity registered under section 12AA and the above sl no. 4 does not exempt when entity registered under 12AA receives service and liable under reverse charge. So according this entity liable under reverse charge will not be exempt. Under all the points as given in the Notification no. 30/2012-ST (reverse charge mechanism) there is common essential character for service receiver is that, it (service receiver) should be business entity. But normally entities registered under section 12AA do not work as a business entity. So if the entity works as business entity and liable to pay service tax as a service receiver under reverse charge then it will be required to take registration under service tax and pay service tax.
Res.Sir, we have executed EPC contract with IOCL-Orissa in which , recently IOCL has directly made payment to our sub contractor on behalf of us. work completion is prior to July-12 , bill raised in Sep-12 in which his classification of service is construction service and he is proprietor. Pls guide me the service tax implication if material and labour both are involved Rupang J Desai (Posted On: 14 Sep, 2012)

Firstly you have not provided information completely. The date of payment is missing. Secondly, all are dependent upon point of taxation i.e. which rate is applicable; category of service etc will be depend upon point of taxation. According to Rule 4 of Point of taxation rules:- In case there is change effective rate (including change in abatement also):--- When service has been provided before change in effective rate of tax, invoice is issued after such change and also payment is received after the change then point of taxation will be ‘date of payment or date of issuing invoice whichever is earlier’. As in your case there is change in effective rate i.e. changes under work contract service. Therefore point of taxation will be date of payment or date of issuing invoice whichever is earlier. Accordingly service tax will be computed as per provisions of work contract service.
Dear sir In case of trust (assume income is morethan Rs 25 Lakhs) registered u/s 12AA, whether Service tax is payable on donations collected. If it is a specific purpose donation, I admit, it can be termed as service for a consideration. In case of voluntary donation, it cannot fit into the definition of "Service". And if need to be paid for all donation, whether service tax for the first 25 lakhs need not be paid?? Pls clarify by N.S.Sivakumar N.S.Sivakumar (Posted On: 14 Sep, 2012)

‘Service’ has been defined in clause (44) of the new section 65B and means – “Any activity carried out by a person for another for consideration, and includes a declared service” The essential character of ‘service’ is that the activity should be carried out by a person for a ‘consideration’ Donation to charitable trust (whether it is general or for specific purpose), is not a consideration for service as charitable trust is not obligate for donor. So donations to a charitable organization are not consideration unless charity is obligated to provide something in return e.g. display or advertise the name of the donor in a specified manner or such that it gives a desired advantage to the donor. If charitable trust is liable for pay service tax it can avail the threshold exemption upto 10 lakh subject to the conditions of the threshold exemption i.e turnover in the last financial year is less than 10 Lakhs rupees.
Sir ji, Pl. clarify, services rendered to Government is taxable or exempted. It is find that the phrase Government is not defined in the Finance Act. visu iyer (Posted On: 13 Sep, 2012)

under mega exemption notification there two clauses which exempt some service provided to government. The first one is sl. No. 12 which exempts some services provided to government, local authority or governmental authority e.g. construction of civil structure, construction or repair of dam etc. The second one is Sl. 25 which exempt the services i.e. repair or maintenance of a vessel or an aircraft, any activity in relation to any function ordinarily entrusted to a municipality in relation to water supply, public health etc. So if service is covered under above referred serial number, the same will be exempt. Otherwise it will be taxable. Further, these exemption covers service provided to government as well as governmental authority. Since the meaning of government is not defined in the Act, therefore, according to education guide on service tax the meaning given under clause (23) of section 3 of the General Clauses Act, 1897 will be taken. According to this ‘Government’ includes both Central Government and any State Government. “Central Government means the President and the officers subordinate to him while exercising the executive powers of the Union vested in the President and in the name of the President.” “State Government means the Governor or the officers subordinate to him who exercise the executive power of the State vested in the Governor and in the name of the Governor” Further essential character of Governmental authority is as follows: • set up by an act of the Parliament or a State Legislature; • established with 90% or more participation by way of equity or control by Government; and • carries out any of the functions entrusted to a municipality under article 243W of the Constitution. For more detail of exemption related to services provided to government or governmental authority, you can refer the sl. no. 12 and 25 of notification no. 25/2012-ST at following link: http://www.new.capradeepjain.com/redirect_amdview_5957_3
Sir ji, Pl. share the notification of exemption for letting out of lorry/truck to lorry agencies. visu iyer (Posted On: 13 Sep, 2012)

According to Item No. 22(b) of Mega Exemption Notification 25/2012-ST dated 20.06.2012 following service is exempt from service tax: “22(b) services by way of giving on hire to a goods transport agency, a means of transportation of goods” i.e. hiring of motor vehicle to a goods transport agency for transportation of goods will be exempt.
Dear Sir Hello !! Please take note of point no. (v) of Notification No. 30/2012-ST dated 20-06-2012, wherein in reference to manpower supply and works contract service it has been mentioned that in order to pay service tax on reverse charge mechanism the service receiver has to be "a business entity registered as body corporate". The word "body corporate" has not been defined anywhere in this negative based service tax regime. But if we go through the deleted Section 65 of the Finance Act, sub-clause (14) of Section 65 stated that body corporate has the meaning assigned to it in section 2(7) of the Companies Act, 1956. When we see the definition of body corporate in companies act the picture still remain unclear on the issue whether an HUF, Society, LLP, Firm (Partnership or Proprietorship), AOP comes under the definition of body corporate. Please evaluate the aforesaid position and let me know whether HUF, Society, LLP, Firm (Partnership or Proprietorship), AOP comes under the definition of body corporate?? Manoj Khatri Advocate Manoj Khatri (Posted On: 13 Sep, 2012)

The definition of body corporate as given under Company Act, 1956 is as follows: “Sec. 2 (7) Body Corporate or corporation includes a company incorporated outside India but does not include – a. A Corporation Sole b. A Co-operative Society registered under any law relating to co-operative societies and c. Any other body corporate (not being a Company as defined in this Act), which the Central Government may by notification in the Official Gazette, specify in this behalf” The concept of Corporation Sole is not defined anywhere in the Act. But concisely, apart from those excluded specifically, a body corporate means any entity that has its separate legal existence apart from the persons forming it. It enjoys a completely different legal status apart from its members. So, a body corporate shall include: a company, a foreign company, a corporation, a statutory company, a statutory body, an LLP, etc. and such bodies that have separate legal existence and exclude proprietorship, partnership, HUF, AOP and Society (already excluded under the above definition).
Dear Sir, as per the Notification NO. 45/2012-ST dated 07-Aug-2012, in respect of services provided or agreed to be provided by a director of a company to the said company, the company has to pay 100% of service tax under reverse charge method. My query is a Director is charging rent for immovable property occupied by the company. Under the old provisions he is charging service tax on the rent amount. Now what would be the status after the above notification? CA. R. Velu (Posted On: 13 Sep, 2012)

The CBEC has been introduced reverse charge mechanism on services provided by directors through the Notification No. 45/2012 dated 07/08/2012. The relevant Para is as follows: “5A in respect of services provided or agreed to be provided by a director of a company to the said company” The notification does not specify that which services provided by directors are covered under the reverse charge mechanism? The interpretation of above Para makes it clear that every services provided by director of company will be covered under the Reverse charge mechanism and company is liable to pay 100% service tax in respect of services provided by directors under the Reverse charge mechanism. For example, even rent payment to director is also covered under the reverse charge mechanism and 100% liability will be on company to pay service tax.
Dear Sir Hello and thanks for posting replies to my query. Today i want to ask a question with regard to Notification No. 33/2012-ST dated 20-06-2012, which provides exemption upto Rs. 10 Lakhs to small service providers. My question in this regard is that while calculating this 10 Lakh, whether non abated amount would be taken into account? Like in the case of a Outdoor Catering, abatement of 40% of gross amount is provided for payment of service tax. would only 60% amount would be taken while calculating the threshold exemption of Rs. 10 lakhs or would the entire gross amount be taken for calculating this threshold exemption? Manoj Khatri (Posted On: 13 Sep, 2012)

Notification 33/2012-ST, exempts “taxable services of Aggregate Value not exceeding ten lakhs rupees” in any financial year from the whole of the service tax leviable thereon. According to explanation (B) of this notification: “(B) aggregate value means the sum total of value of taxable services charged in the first consecutive invoices issued during a financial year but does not include value charged in invoices issued towards such services which are exempt from whole of service tax leviable thereon under section 66B of the said Finance Act under any other notification.” The above explanation makes it clear that aggregate value means “sum total of value of taxable services” i.e. for calculating aggregate value of Rs. 10 Lakhs, total value of taxable service will be considered and not only non abated value. But value of wholly exempt service will not be considered for calculating aggregate value of Rs. 10 Lakhs.
Dear Sir, one of my client is a private limited company and availing the services of Manpower supply. In the bill of August 2012, service tax to the tune of 12.36% was added and due to ignorance of new service tax provisions my client paid the entire billed amount with total service tax to the service provider. Now my client has come to know that under RCM they were liable to pay 75% of the service tax but due to 100% payment of service tax to the service provider they are unable to decide what to do in the matter. Please evaluate the situation and let me know what my client should do in this situation. does 100% payment of service tax by the service provider gives relief to the service receiver to pay the service tax portion under RCM ? Manoj Khatri Advocate Manoj Khatri (Posted On: 12 Sep, 2012)

There is no provision in Service Tax Law as well as in Cenvat Credit Rules, 2004 which provide e.g. payment of service tax by service provider gives relief to service receiver when liability to pay service tax is on service receiver. However, at the same time, it is basic principle that the service tax cannot be paid twice on the same service. But to avoid litigation, we will suggest you to ask service provider to refund the excess service tax and then you deposit the service tax with the department. If the same is not possible then you have plead in light of above case laws.
Sir, Cenvat credit on Service tax paid by the dealer to manufacture,Can manufacturer take cenvat credit particularly after the notification no. 28/12 dated 20-jun-12 and exclusion clause made availbe therein Rasik Patel (Posted On: 12 Sep, 2012)

your query is not clear, please explain how a dealer can pay service tax to manufacturer and under what service?
Sir, For having installed centralised A.C system the contractor had furnished bills for material and labour separately. It may please be clarified that even in such cases the service receiver is obliged to pay service tax under the provisions of partial reverse charge on the labour bill of the contractor. Whether splitting up of bills for material and labour is justifiable to avoid the liability of service tax by the service receiver. Kindly clarify early. nagarajan v (Posted On: 11 Sep, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” The activity of installation of Centralization AC System involve transfer of property in goods i.e. material also hence covered under the above definition of Work contract service. Now the question arises whether the nature of service and service tax liability can change with change in style of billing when the facts are clearly show the nature of service as defined under the Act. According to our opinion the style of billing can’t change the nature of service and treatment, therefore it will be covered under the work contract service and accordingly treatment will be done. Moreover, the valuation rule of works contract also say firstly to deduct the material portion from the works contract amount and then pay service tax on labour charges. If this is not possible then the service tax is payable on 40% of total value. Thus, if the material is billed separately also then it will fall under works contract and reverse charge will also be apply. Only in case of pure labour contract, the service tax is payable on labour charges only.
Dear Sir, in second proviso to Notification No. 33/2012-ST dated 20-06-2012, it has been mandated that "such value of taxable services in respect of which service tax shall be paid by such person and in such manner as specified under sub-section (2) of section 68 of the said Finance Act read with Service Tax Rules,1994.". My query is that what is the practical applicability of this proviso clause. What if the service provider is getting any kind of abatement on the gross value. an explanatory example in this regard would be highly useful for every member of your forum. Manoj Khatri Advocate Manoj Khatri (Posted On: 11 Sep, 2012)

The Notification No. 33/2012-ST states about the threshold exemption for small service providers of 10 Lakh rupees, if the conditions contain in this notification is satisfy. Further the Sl. 1(ii) of this notification states: “Provided that nothing contained in this notification shall apply to such value of taxable services in respect of which service tax shall be paid by such person and in such manner as specified under sub-section (2) of section 68 of the said Finance Act read with Service Tax Rules, 1994” The meaning of above para is that the provisions of this notification will apply to “such value of taxable services in respect of which service tax shall be paid by such person and in such manner as specified under sub-section (2) of section 68”. The Section 68(2) is meant for service tax payable by receiver under reverse charge mechanism. This has been mentioned under notification No. 30/2012-ST. So effectively it means threshold exemption of 10 lakh will not be available to the service receiver liable to pay service tax under reverse charge mechanism.
Dear Sir,Sec. 66F(1)of the Finance Act, 1994, states that, "unless otherwise specified, reference to a service (hereinafter referred to as main service) shall not include reference to a service which is used for providing main service." My query is that, what exactly this phrase means?? An explanatory example in this regard would be appreciable. Manoj Khatri Advocate Manoj Khatri (Posted On: 11 Sep, 2012)

It simply means input service for providing output service will be considered as separate service and will not be covered under main service i.e. if output service is exempt from service it does not mean that input service used for providing that service will also be covered under the exemption. We can understand this by following example: ‘Provision of access to any road or bridge on payment of toll’ is a specified entry in the negative list in section 66D of the Act. Any service provided in relation to collection of tolls or for security of a toll road would be in the nature of service used for providing such specified service and will not be entitled to the benefit of the negative list entry.
Whether service tax liability is attracted in case of commission received from outside India. The commission is received for finding buyers for the goods sold by the foreign principal. Please respond with reference to Export of Services Rules. Anubhav Wahee (Posted On: 11 Sep, 2012)

Firstly your service is covered under the definition of ‘service’ as given under clause 44 of section 65B and not covered under any of the entry of negative list and exemption notification, so service tax will be applicable if it satisfied the provision of charging section 66B i.e. service tax will be applicable when service is provided or deemed to be provided in the taxable territory. With effect from 1.7.2012, the export of service rule has been deleted. The new Place of Provision of Service Rules has been made applicable. These rules determine “the place where a service shall be deemed to be provided” and Section 66B provides that “a service is taxable only when it is “provided or agreed to be provided in the taxable territory”. Thus, the taxability of a service will be determined based on the “place of its provision”. The Rule 9 (c) of Place of Provision Rules reads as follows:- “The place of provision of ‘intermediately services’ shall be the location of the service provider.” As per rule 2(f) of these rules “intermediary” means a broker, an agent or any other person, by whatever name called, who arranges or facilitates a provision of a service (hereinafter called the ‘main’ service) between two or more persons, but does not include a person who provides the main service on his account. As your case is covered under the above referred intermediately services, therefore the service is deemed to be provided at location of service provider i.e. in taxable territory. It satisfied the provision of charging section 66B that service tax is applicable when provided or agreed to be provided in the taxable territory, hence service tax will be applicable.
Dear Sir, as per Notification No. 30/2012-ST dated 20-06-2012, vide Sl.No. 8, reverse charge mechanism has been mandated on manpower supply services and 75 Percentage of service tax is to deposited by the person receiving the service. My question in this regard is that, now how will be the Invoice/Bill be issued by the service provider in this regard. whether the service provider will show 100% service tax amount (12.36%) or will he show only 25% service tax amount (3.09), which he is liable to deposit to the government exchequer. A detailed answer in this regard would be highly appreciated. Manoj Khatri Advocate Manoj Khatri (Posted On: 10 Sep, 2012)

Under the reverse charge mechanism, service provider and service receiver both are liable the service tax. The service provider is liable only to extent of liability of service provider of his liability under service tax. Hence, he will charge the service tax only to the extent of his liability in his bill i.e. 3.09%.
Dear Sir, Section 66F of the Finance Act, 1994, makes provision for bundling of services. Sub-section 3 of the said section in clause (a), uses the word, "naturally bundled in the ordinary course of business" and in clause (b) it uses the word, "not naturally bundled in the ordinary course of business". I would be obliged, if your good self provides an explanation, with an example, on the difference between both clause (a) & (b), wherein naturally bundled and not naturally bundled has been used. Manoj Khatri Advocate Manoj Khatri (Posted On: 10 Sep, 2012)

The clause (a) contains the treatment of bundled services when service is naturally bundled and according to this “‘If various elements of a bundled service are naturally bundled in the ordinary course of business, it shall be treated as provision of a single service which gives such bundle its essential character” It means when bundled service provided is natural bundled service then it will be treated as single service which have dominant in those bundled services. We can understand this by following illustration: A hotel provides a 4-D/3-N package with the facility of breakfast. This is a natural bundling of services in the ordinary course of business. The service of hotel accommodation gives the bundle the essential character and would, therefore, be treated as service of providing hotel accommodation. The clause (b) contains that “If various elements of a bundled service are not naturally bundled in the ordinary course of business, it shall be treated as provision of a service which attracts the highest amount of service tax”. We can understand this by following example: A house is given on rent one floor of which is to be used as residence and the other for housing a printing press. Such renting for two different purposes is not naturally bundled in the ordinary course of business. It will be treated as a service comprising entirely of such service which attracts highest liability of service tax. In this case renting for use as residence is a negative list service while renting for non-residence use is chargeable to tax. Since the latter category attracts highest liability of service tax amongst the two services bundled together, the entire bundle would be treated as renting of commercial property.
Dear Sir, as per the Notification NO. 45/2012-ST dated 07-Aug-2012, in respect of services provided or agreed to be provided by a director of a company to the said company, the company has to pay 100% of service tax under reverse charge method. my question is that, in many cases remuneration to director is given on annual basis, but the liability of the company to pay service tax to the government exchequer arises the subsequent month, when payment of said remuneration to the director is made. Please clarify the situation of service tax payment by the company when there is provision of annual payment of remuneration to the director. Manoj Khatri (Posted On: 10 Sep, 2012)

Firstly it clarified that service tax is not applicable when the services are provided by an employee to the employer in the course of or in relation to his employment (exclusion clause of definition of service). As Managing directors/ directors are treated as employee of company, the service tax is not applicable on their remuneration. The service tax will be applicable on those amounts paid to director/MD which is not in course of employment e.g. sitting fees paid to independent/non-executive director, service provided by a managing director by way of renting of immovable property. Secondly, Rule 7 of Point of Taxation Rules provides that: “The point of taxation for the service receiver liable under reverse charge is the date on which payment is made to the service providers”. Further the proviso to Rule 7 provides that in cases “where such payment is not made within a period of six months of the date of invoice, the point of taxation shall be determined as if rule 7 ‘does not exist’.” So under the reverse charge mechanism, the due date of deposition of service tax is 5th/6th day immediately following the month in which payment is made. But if the payment is not made within six months of raising of bill then the point of taxation shifts to date of invoice (i.e. determined as if rule 7 ‘does not exist’). Consequently, service tax has to be paid along with interest.
Dear Sir, My Pvt. Ltd. company having the business of running hospital, promoters of the company are paid director remuneration in their professional capacity as practicing doctors in the hospital itself. Is these payment are also exempt as Health Services ? and please also explain the applicability of reverse charge on the above issue? Akash Jain (Posted On: 10 Sep, 2012)

Definition of ‘service’ (clause 44 of section 65B) excludes: “a service provided by an employee to an employer in the course of the employment” Further the directors (managing director/executive directors/managers) of company are employee of company therefore the services provided by employee during the course of employee will not be taxable as not covered under the definition of ‘service’. Further if director is not treated as employee of company i.e. which work independently as a professional practitioner or a provision of service which is not in the course of employment e.g. independent directors, non executive directors then the same will be covered under the definition of service. But will be covered under the sl. No. of 2 of mega exemption notification no. 25/2012-ST relating to health care service.
Dear Sir, Hello. First of all i would like to appreciate the pain which you and your team is taking in making the members aware of the new service tax structure. My query is that, as w.e.f. 02-07-2012, the new definition of service has came into effect and as a result the person who was earlier paying service tax only on GTA services on reverse charge method, now has also to pay service tax on other services also, under reverse charge method. Now please let me know that whether there need to make any amendment in the existing Registration Certificate. If the answer is yes, than please quote the legal provision and if not, than the basis on which the answer is in negative. Manoj Khatri, Kanpur Manoj Khatri (Posted On: 10 Sep, 2012)

No, you are not required to amend your existing registration. Now the negative list has been effective and accordingly classification of services is not there. The form for service tax registration i.e. has also been amended and in service classification column of new form of ST-1, the only one entry is shown for all the services as follows: “Service other than in the Negative List” and it is common for all the assessees. So the above description of service will common for all assessees and there is no requirement of amend the service tax registration.If you want to be particular, file application electronically for amending registration certificate. Now only option available is ‘All taxable Services other than in Negative List’. Click and add. Get print out of the amended registration certificate and send copy to department
Sir, we are in the business of buying vacant land and subdividing into smaller plots. for this we take the approval of local municipal / panchayat authorities by paying necessary fees. please advice us on whether we are liable for service tax on the plots sold. CA. R. Velu (Posted On: 09 Sep, 2012)

Applicability of service tax on Approval from Local Authority: Section 66D specifies negative list of services as non-taxable and Sl. No. (a), specifies services provided by Government and Local Authority as non-taxable. Further Panchayat/Municipality is covered under definition of local authority and the service i.e. approval fees is covered under the above clause of negative list, therefore it will be non-taxable. Applicability of service tax on sub-dividing of vacant land into plots: ‘Service’ has been defined in clause (44) of the new section 65B and means – “Any activity carried out by a person for another for consideration, and includes a declared service” The above definition states “carried out any activity by a person for another” but in your case, you are purchasing vacant land, subdividing and selling these plots to the buyers. Your business is not an activity by a person for another as mentioned in the definition of service i.e. you are not providing a services of subdividing the land to any person but doing the business of selling the plots. Further ‘service’ excludes “(a)(i) an activity which constitutes merely a transfer of title in goods or immovable property, by way of sale, gift or in any other manner”. So selling of plots is covered under this exclusion clause. Hence, selling of plots is not covered under the definition of ‘service’. Therefore, no service tax is payable. But if you are doing any activity for a person as sub diving the land into plots and charges for this work i.e. you are not purchasing the land and selling the plots then it will be covered under the definition of service.
Sir, we are in the field of construction of roads in the premises of power company since 01.01.2012, Kindly let me tell about service tax applicability on road construction services SUNIL ARORA (Posted On: 08 Sep, 2012)

Under new negative list concept service tax will be leviable if activity is covered under the definition of ‘service’ as give under clause 44 of section 65B and not covered under Negative List and Mega Exemption Notification. “Service means any activity carried out by a person for another for consideration and includes declare services. Your service i.e. construction of road is clearly covered under the above definition. Further Sl. No. 13 of Mega exemption notification 25/2012-ST exempts the following service: “13(a) Services provided by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of a road, bridge, tunnel, or terminal for road transportation for use by general public” The above exemption will be available when service is use by general public. The term General public is defined in Serial No. (q) of para 2 of notification 25/2012-ST dated 20.6.2012 as follows: “‘general public’ means the body of people at large sufficiently defined by some common quality of public or impersonal nature” In your case road is constructed in the premises of Power Company and the use of this road is limited to the power company and by those people which are related to Power Company. The road will not be used by general public as mentioned in the exemption, so this exemption will not be available and service tax will be leviable.
My company has made an agreement with individual regarding to horticulture services and in the agreement, its defined that service provider provide the services through 1 supervisor and 6 unskilled worker. Now my question is whether its covered under reverse charge mechanism as manpower hiring or not covered under RCM as maintenance services of plantation/ green area. Navin Jain (Posted On: 08 Sep, 2012)

The Notification No. 30/2012-ST provides the reverse charge mechanism in some services and it covers Manpower Supply Service also. In your case applicability of reverse charge mechanism will be based on “whether the service is covered under Manpower Supply service or not. Rule 2(g) of Service Tax Rule, 1944 defines supply of manpower to means: “supply of manpower temporarily or otherwise to another person under his superintendence or control” So the essential character of manpower supply service is that “the manpower will be worked under the superintendence or control of service receiver. In your case there is a contract for horticultural services and the manpower will work under supervision and control of service provider so it is not covered under manpower supply service and reverse charge mechanism will not be applicable. But if the manpower will work under supervision of service receiver, the service will be covered under manpower supply service and subjected to reverse charge.
Our company is located in a rented premises. Besides payment of monthly rent to the owner of the premises, we are paying maintenance charges towards general and upkeeping of the building. This amount is being paid to the wife of the owner of the premises. Under the circumstances it may please be clarified whether we have to pay service tax under partial reverse charge provisions on the maintenance charges being paid to the wife of the owner of premises. She is not charging service tax in the bill raised for such maintenance charges. nagarajan v (Posted On: 07 Sep, 2012)

Your Company is paying service charges to wife of owner of building towards maintenance and up keeping of the building. It shows wife of owner of building is providing maintenance services to your company and reverse charge will be applicable if it is covered under the work contract service. Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” As in your case there is a service of maintenance, which also covered under the above definition of work contract service but the essential character of work contract service is that “there should be transfer of property in goods involved in execution of such contract. So if your service is covered under above definition of work contract, reverse charge will be applicable.
GTA is raising the combined bill of fright and his commission for arranging the transport and Service tax is paid by the Service recipient @25% abatement . is he is lay able to pay service tax on commission separately under 65(105(ZZb) ca ajay jain (Posted On: 07 Sep, 2012)

Under the new system of negative list of services, section 66F lays down the principle of interpreting specified description of services and bundled services. According to section 66F- “(3) (a) if various element of such service are naturally bundled in the ordinary course of business, it shall be treated as provision of the single service which gives such bundle its essential character.” Further “Bundled service” means a bundle of provision of various services wherein an element of provision of one service is combined with an element or elements of provision of any other service or services. The above rule will apply here as in your case services are provided combined i.e. bundled service. Further under Goods Transport, normally the agency charges both commission as well as freight so the services are naturally bundled. Further the above rule make it clear that bundled services shall be treated as provision of single service which give such bundle its essential character i.e. the service will be treated as single service which is dominant in nature. So here Goods transport is dominant and the whole service will be treated as GTA service and service tax will be chargeable on 25% value of service.
our company has hired motor vehicles on contract from individuals for commutation of employees between their residence to factory. The contrators are not registered with service tax deptt. hence nobody is charging service tax. Whether abatement of 60% of Gross amount charged can be availed for determination of value of taxable service and as a service receiver only 40% of service tax is payable on 40% of the gross amount charged ? Manoj Agrawal (Posted On: 06 Sep, 2012)

Mega Exemption Notification no. 25/2012-ST dated 20.6.2012 exempts Contract carriage. The relevant clause reads as follows:- “23. Transport of passengers, with or without accompanied belongings, by - (b) a contract carriage for the transportation of passengers, excluding tourism, conducted tour, charter or hire; or” As per clause (m) to definitions given in the mega notification, definition of Contract carriage will be borrowed from Section 2(7) of Motor Vehicles Act, 1988 which reads as under:- "contract carriage" means a motor vehicle which carries a passenger or passengers for hire or reward and is engaged under a contract, whether expressed or implied, for the use of such vehicle as a whole for the carriage of passengers mentioned therein and entered into by a person with a holder of a permit in relation to such vehicle or any person authorised by him in this behalf on a fixed or an agreed rate or sum (a) on a time basis, whether or not with reference to any route or distance; or (b) from one point to another, and in either case, without stopping to pick up or set down passengers not included in the contract anywhere during the journey, and includes- (i) a maxicab; and (ii) a motorcar notwithstanding the separate fares are charged for its passengers;” So for availing exemption, the essential characters of contract carriage are as follows: 1. The vehicle should be engaged under a contract - whether expressed or implied. 2. The use of such vehicle as a whole for the carriage of passengers mentioned therein. 3. The contract is either on a time basis (whether or not with reference to any route or distance) or it is on destination basis (from one point to another) 4. The vehicle does not stop to pick up or set down passengers not included in the contract anywhere during the journey As your query is not clearly shows the contract description, so you have to see that your contract is covered under the above definition of contract carriage. If covered, it will be exempt from levy of service tax. If your contract is not covered under the above exemption, service tax will be payable on 40% of gross amount charged (Sl No. 9 of Abatement Notification No. 26/2012-ST) and 100% liability to pay service tax on service receiver under reverse charge mechanism as service provider is an individual and receiver is a company (sl. no. 7(a) of notification no. 30/2012-ST).
Sir, for cleaning of our factory a contract is being to a man power supply agency owned by an individual and he deputes 18-20 persons on regular basis who works under his control and guidance but cleaning material is provided by us. After recent amendments instead of 12.36% now he is charging only 3.09% service tax whether we have to pay balance service tax @9.27% under reverse charge base? Manoj Agrawal (Posted On: 06 Sep, 2012)

As you are saying that the labour is worked under the control of service provider, therefore, it will be not covered under definition of “manpower supply service” as given under section Rule 2(g) of Service Tax Rules, 1994. The essential character of “manpower supply service” is that the labour should work under supervision and control of service receiver. But this is totally absent in instant case. Further the supply of cleaning material by you does not imply that the labour is working under your control and supervision. (i.e. of service receiver). Thus, the service is not covered under the definition of “manpower supply service”. Therefore, reverse charge mechanism will not be applicable and 100% liability of deposition of service tax is on service provider only.
We are a manufacture clearing goods under excise, we are availing the services of a labour contractor who engages labour that work under his supervision and control. Therefore service tax will not be applicable under reverse charges. Will the contractor have to charge service tax on the full amount of the bill after availing exemption of 10.0 lakhs, iif yes under which category of service? Further, since we are paying Excise on goods manufactured we can avail Cenvat Credit on the Service Tax or is there a provision for exemption from service tax as the services are being used for manufacturing goods on which excise is being paid? Bharath Kedia (Posted On: 05 Sep, 2012)

You are correct that reverse charge will not be applicable as service is not covered under the definition of “Manpower Supply Service” because the labour is work under the supervision and control of contract not under the supervision of service receiver. Further the exemption of 10 Lakhs is not applicable in case of service tax is paid by service receiver under reverse charge mechanism. In your case reverse charge mechanism is not applicable and 100% service tax is deposited by the service provider i.e. contractor. So contractor can avail the threshold exemption of Rupees 10 Lakhs, if he is eligible for the same (i.e. contractor’s turnover in the last financial year is less than 10 Lakhs rupees). By introducing negative list of services, the importance of categorizing the service has been limited to some issues e.g. reverse charge, valuations. Even the in new format of ST-1(service tax registration form) and ST-3(service tax return) the category of service is mentioned as “services not in negative list”. So category of service is not important here as there is no system present which defines each service separately as existed earlier. In your case, in the invoice contractor can mention as “Labour Contract or Contract for Work”. Availment of Cenvat Credit: There is no provision in Cenvat credit Rules, 2004 which provides exemption from service tax as services are used in manufacturing of excisable goods. Further you avail the service tax credit on this service if it is covered under the definition of ‘Input service’ as given under Rule 2(l) of Cenvat Credit Rules and can utilize the same against your excise liability.
Respected sir, my question is weather services provided to Gujarat Sickle Cell Anemia Control Society under society registration act 21 of 1860 considered services provided to government? My client is providing blood sample testing to above mentioned society. Kindly let me know your opinion. Thanks alfa (Posted On: 05 Sep, 2012)

According to Notification no. 25/2012-ST following is exempt: “25 services provided to Government, a local authority or a governmental authority by way of --- (a) carrying out any activity in relation to any function ordinarily entrusted to a municipality in relation to water supply, public health, sanitation conservancy, solid waste management or slum improvement or up gradation” The above exemption is allowed when service is provided to Government, local authority or a governmental authority. The meaning of government is not defined in the act and going through the meaning as given under the education guide of service tax, a society i.e. Gujarat Sickle Cell Anemia Control Society is not covered under the meaning of Government or Local Authority. Further essential character of Governmental authority are given below • set up by an act of the Parliament or a State Legislature; • established with 90% or more participation by way of equity or control by Government; and • carries out any of the functions entrusted to a municipality under article 243W of the Constitution. So you have to see what is the structure of society for meaning of governmental authority.
Sir, Bank Guarantee commission received by a company from another is chargeable to ST before budget 2012, if yes , under which service. Second, what is the status of taxability after 01.07.2012. SANJAY GUPTA (Posted On: 05 Sep, 2012)

Normally bank charges commission for bank guarantee and it was covered under the “Banking and Financial service” prior to introduction of Negative list concept. It is not clear how the bank guarantee commission is received by a company from another. Hence we request you to clarify this point.
if the employer pays the service tax instead of recovering from the employee for employer-employee related service, can he avail the cenvat credit on this amount as the circular of July states that cemvat credit can be availed on this service. Secondly, from which date this employer-employee related service is applicable since the circular came in July end-is it also 1st July manish joshi (Posted On: 04 Sep, 2012)

Your question is not clear as there is no service tax on: “(b) a provision of service by an employee to the employer in the course of or in relation to his employment” [Exclusion clause No. (b) of ‘service’ as defined under section 65B(44)]. Hence, your contention that the service tax is applicable on the same is totally erroneous.
we are related to real estate service and we make a booking in last f.y but receently it is cancelled. than provide me solution reagarding Service tax issues gaurav (Posted On: 04 Sep, 2012)

As per Rule 6(3) of Service Tax Rules, 1994: “Where an assessee has issued an invoice, or received any payment, against a service to be provided which is not so provided by him either wholly or partially for any reason or where the amount of invoice is renegotiated due to deficient provision of service, or any term contained in a contract, the assessee may take the credit of such excess service tax paid by him, if the assessee,- (a) has refunded the payment or part thereof, so received for the service provided to the person from whom it was received; or (b) has issued a credit not for the value of service not so provided to the person whom such an invoice had been issued.” So if you received any payment against this service which is now cancelled, you can make refund of amount received from service receiver and take the credit of excess amount of service tax paid(i.e. already deposited) related to this cancellation. Further if you had issued the invoice then you can now issue a credit note and can take the credit of excess amount paid. if service is not provided, service provider can make the refund of amount earlier received or can issue a credit note if invoice is issued earlier and can take the credit of excess service tax paid by him due to this cancellation.
Sir, we are the manufacuture of Zinc Sulphate agriculture grade and registered with excise dept. we want to purchase Sulphuric Acid without payment of duty.pl let us know the excise formalities Prem Shanker Gupta (Posted On: 04 Sep, 2012)

The entry for this product is as follows in the Notification 12/2012-CE: “Sl No. 86 -- Sulphuric acid, oleum, oxygen and ammonia used in the manufacture of fertilizers” ---Condition No. 2 should be followed. The Condition No. 2 is as follows: “Where such use is elsewhere than in the factory of production, the exemption shall be allowed if the procedure laid down in the Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 2001, is followed” Hence, you have to follow the procedure laid down in above rules. These rules are inserted by Notification No. 34/2001-CE (N.T.) and as amended to the date.
We are providing consulting Engineering service to SEZ. Our client says that he is SEZ Unit, hence do not charge service tax on our invoices as per SEZ latest notification no 40/2012 dt. 20.06.2012 applicable from 01.07.2012. Sir, Please suggest me what document/forms should we have obtained from DLF Limited to satisfy our service tax authorities at the time of our service tax assessment? Ranbir Singh (Posted On: 04 Sep, 2012)

As per notification 40/2012-ST : “Provided that where the specified services received in SEZ and used for the authorised operations are wholly consumed within the SEZ, the person liable to pay service tax has the option not to pay the service tax ab initio instead of the SEZ unit or the developer claiming exemption by way of refund in terms of this notification” Thus, it is clear from above, if the service is totally consumed in SEZ then there is no need to pay the service tax. Otherwise, the service tax is to be paid and then the refund should be claimed by SEZ unit. Now, you have to decide whether the service is wholly consumed in SEZ or not. Further notification does not states about the document obtained by the service provider in case of SEZ opt an option to not pay the service tax instead of availing exemption through refund. So for your record you can take the declaration from the SEZ unit that this service is wholly consumed in SEZ only.
Sir Please clarifying which tax is applicable on printing and designing of magzines of our institute. We do not provide them any material. vishal Pawar (Posted On: 04 Sep, 2012)

As per serial No. of Notification 25/2012-ST following service is exempts: “Carrying out an intermediate production process as job work in relation to- (a) Agriculture, printing or textile processing as job work” So the service tax will not be leviable as it is exempt under the notification No. 25/2012-ST. Further as told in query that you have not providing any material, hence it is not job work but a sale of good. Hence, no service tax is payable.
Respected Sir, One of my clients is taking the benefit of noti.no.08/2003 in excise of turnover limit now in this financial yr he has come in excise in the month of august-12 in the second qtr. as now he will be liable to file ER-3 RET. in the month of Oct-12, after can he file ER-1 or ER-3 or it is compulsory to file ER-3. mehul (Posted On: 03 Sep, 2012)

As per Rule 12 of Central Excise Rules 2002, (Filing of return) "(1) Every assessee shall submit to the Superintendent of Central Excise a monthly return in the form specified by notification by the Board, of production and removal of goods and other relevant particulars, within ten days after the close of the month to which the return relates i.e. Monthly Return ER-1." Further proviso 3 of the above rule 12(1) provides: “Provided further that where an assessee is eligible to avail of the exemption under a notification based on the value of clearance in a financial year (i.e. SSI), he shall file a quarterly return in form specified, by notification, by the Board, of production and removal of goods and other relevant particulars within ten days after the close of the quarter to which the return relates. i.e. ER-3 Explanation 1 – For the purpose of this proviso, it is hereby clarified that an assessee shall be eligible, if his aggregate value of clearance of all excisable goods for home consumption in the preceding financial year computed in manner specified in the said Notification did not exceed rupees four hundred lakhs. Explanation 2- the filling of returns as specified in this proviso shall be available to the assessee for the whole financial year” The provisions make it clear that when an assessee having turnover of not more than rupees four hundred lakhs in the preceding financial year, he should file the quarterly return i.e. ER-3. Further the above explanation 2 stated that the filling of returns as specified in this proviso shall be available to the assessee for the whole financial year. So if an assessee comes under levy of excise in the month of August ( i.e. till now he is filing ER-3), still he should file the ER-3 in the remaining whole year.
We are having MFS unit we are enhancing our building but contractor is not registered under service tax, (service Like Fabrication, civil Work). We offered to do the labour job only. Any service tax is applicable? what is the percentage? if st applicable not to take the input service tax Kindly help me Thanks With Regards Halaswamy K M 9844362179 - HALASWAMY K M - vcpl98@gmail.com 28/08/2012 (Posted On: 01 Sep, 2012)

Applicability of Service Tax: ‘Service’ has been defined in clause (44) of the new section 65B and means – “any activity carried out by a person for another for consideration, and includes a declared service” The Labour Job Contract is clearly covered under the above definition of “service”. Further this service is also not covered under the Negative List as given under section 66D or under Mega Exemption Notification 25/2012-ST, therefore service tax will be leviable. Service tax Rate and Reverse Charge Since you have given only labour contract only, the service is not covered under the definition of “Work Contract Service” as given under section 65B (54) because there is no any transfer of property in goods involved which is the essential character of work contract service. Further the service is also not covered under the definition of Manpower supply service as given under section Rule 2(g) of Service Tax Rules, 1994 because it is contract for labour job and manpower will not work under superintendence or control of service receiver, which is essential character for manpower supply service. So the service is not covered under any of the service given above i.e. work contract or manpower supply service therefore reverse charge (where service receiver is also liable) will also not apply. Further the service is not covered under work contract service therefore valuation rule will not apply and service tax will leviable @ 12.36% (including cess). Credit of Input service: For input credit we have to see whether the above mentioned service is covered under the definition of Input Service as given Rule 2(l) of Cenvat Credit Rules. According to definition input service includes “services used in relation to modernization, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises” Further input service excludes “construction of a complex, building, civil structure or a part thereof”.
Respected sir Garden Maintenance is covered under service tax -Krishnmaurthy - krishna.prakash@ymail.com (Posted On: 01 Sep, 2012)

‘Service’ has been defined in clause (44) of the new section 65B and means – “any activity carried out by a person for another for consideration, and includes a declared service” Garden Maintenance Contract is covered under the above definition of service. Further the above service is also not covered under the Negative List as given under section 66D or under Mega Exemption Notification 25/2012-ST, therefore service tax will be leviable.
sir,please tel us GTA calculation from 1.07.2012,pay on 25% & rs.750/-(nil) OR 100% paid on transporter bill. somnath (Posted On: 31 Aug, 2012)

Notification No. 25/2012-ST exempts: “21. Services provided by a goods transport agency by way of transportation of - (b) Goods where gross amount charged for the transportation of goods on a consignment transported in a single goods carriage does not exceed one thousand five hundred rupees; or (c) Goods, where gross amount charged for transportation of all such goods for a single consignee in the goods carriage does not exceed rupees seven hundred fifty” Further Sl. No. 7 of Notification no. 26/2012-ST, provides that service tax will leviable of 25% of total value of service in case of “Services of goods transport agency in relation to transportation of goods. So 1. If GR is below Rs. 750/- it will be exempt. 2. If material is send on Full Truck Load basis (i.e. only one consignment), it will be exempt if transportation cost shall not exceed Rs. 1500. 3. If not covered under above 1 & 2 i.e. GR is more than 750/1500, service tax will be leviable on 25% of total value of service (i.e. 75% abatement)
Budget Proposal : -Basic customs duty to be reduced from 7.5% to 2.5% on plant and machinery imported for setting up or substantial expansion of iron ore pellet plants or iron ore beneficiation plants. Sir please give reference under which chapter heading it will fall and what is basic custom duty. Thanks Pankaj Bardia Pankaj Bardia (Posted On: 29 Aug, 2012)

“Capital goods/ equipments required for setting up or substantial expansion of iron ore pellet plants & iron ore beneficiation plants” is fall under chapter heading 9801 (project import) and the Rate of Basic custom duty is 2.5% as per sl. No. 506 of Notification No. 12/2012-CUS.
IN HOTEL INDUSTRY WHETHER INPUT CREDIT OF EXCISE DUTY OF BEVERAGE CAN AVAIL AGAINST THE SERVICE TAX LIABILITY? Navin Jain (Posted On: 29 Aug, 2012)

Sl. No. 4 of Abatement Notification No. 26/2012-ST provides 30% abatement in case of “Bundled service by way of supply of food or any other article of human consumption or any drink, in a premises (including hotel, convention center, club, pandal, shamiana or any other place, specially arranged for organizing a function) together with renting of such premises” Further Rule 2(c) of Service (Determination of Value) Rules, 2006 specifies service portion as 40% of Total Amount (i.e. 60% abatement) in following case: “an service wherein goods, being food or any other article of human consumption or any drink (whether or not intoxicating) is supplied in any manner at a restaurant” For both the above services there is a condition that “CENVAT credit on any goods classifiable under Chapters 1 to 22 of the Central Excise Tariff Act, 1985 (5 of 1986) used for providing the taxable service, has not been taken under the provisions of the CENVAT Credit Rules, 2004” Further the “Beverages” is covered under the Chapter 22 of the Central Excise Tariff Act, 1985. Therefore the credit of beverages is not available to Hotel Industry. So the question of availing this credit does not arise.
If the GTA is a company, whether a factory still has to pay service tax on reverse charge basis if transport charges is paid to a GTA which is a body corporate. K K Daruka (Posted On: 28 Aug, 2012)

Applicability of reverse charge under the service provided by GTA is not dependent on type of service provider and depends upon the type of service receiver (who pays or is liable to pay freight by himself or through agent is treated as service receiver under Notification No. 30/2012 i.e. reverse charge). As per clause (2) of Notification 30/2012-ST, service tax is payable by the recipient of service in respect of services provided by goods transport agency for transportation of goods by road where the person liable to fright is any of following: (a) any factory registered under or governed by the Factories Act, 1948 (63 of 1948); (b) any society registered under the Societies Registration Act, 1860 (21 of 1860) or under any other law for the time being in force in any part of India; (c) any co-operative society established by or under any law; (d) any dealer of excisable goods, who is registered under the Central Excise Act, 1944 (1 of 1944) or the rules made thereunder; (e) any body corporate established, by or under any law; or (f) any partnership firm whether registered or not under any law including association of persons; So if the payment is made by person specified in above list then service tax is payable by him otherwise the service tax is payable by provider of service.
Whether a "Franchisee Restaurant" while claiming abatement & charging Service Tax on the 40% portion of the Bill, can claim Cenvat Credit in respect of service tax paid on the "Franchisee Fee" and "Rent" for the restaurant premises.Your valuable inputs would be greatly appreciated. Naresh Dhamija Naresh Dhamija (Posted On: 25 Aug, 2012)

Rule 2(l) of Cenvat Credit Rules, 2004 and it is as follows: “input service” means any service, – (i) used by a provider of taxable service for providing an output service; or (ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal, and includes services used in relation to modernization, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services, inward transportation of inputs or capital goods and outward transportation upto the place of removal. Further the Notification 24/2012-ST (Determination of value rules, 2006) provides value of service portion as 40% of total value under Restaurant service and explanation given in this Notification in respect of Restaurant service is as follow: “Explanation 2.- For the removal of doubts, it is clarified that the provider of taxable service shall not take CENVAT credit of duties or cess paid on any goods classifiable under Chapters 1 to 22 of the Central Excise Tariff Act, 1985 (5 of 1986).”. Moreover, the rate of abatement has been reduced from 70% to 60% and taxable portion is increased from 30% to 40% with a view to extend cenvat credit to Hotel industry. Hence the Hotel can also avail the cenvat credit. So credit is available in respect of input services i.e. "Franchisee Fee" and "Rent" for the restaurant premises, will be allowable as covered under the definition of input as well as there is no restriction in the above explanation given in the Notification No. 24/2012-ST.
1) Under the Reverse Mechanism of Service Tax whether Service Provider should compulsorily have ST number if not then should the service provider is liable to make the payment of its liability as a service receiver even though the service provider does not have ST number. 2) Under advertisement the rent paid for exhibition attracts ST under reverse mechanism or not. Kindly clarify. Thanks (Posted On: 25 Aug, 2012)

1. According to Rule 4 of service tax rules 1994, “(1) Every person liable for paying the service tax shall make an application to the concerned Superintendent of Central Excise in Form ST-1 for registration within a period of thirty days from the date on which the service tax under section 66B of the Finance Act, 1994 is levied.” So if service provider is liable to pay service tax then he should make a registration within the thirty days. Further if earlier service provider has not taken the service tax registration as he is not liable to pay service tax but now he is liable to pay service tax under reverse charge as a receiver then he should now required to grant service tax registration as he is now “a person liable to pay service tax” as a service receiver. 2. Clause (g) of section 66D specifies selling of space or time slot for advertisement other than advertisement broadcast by radio or television as a non-taxable service. Therefore service tax will not be leviable on rent paid for advertisement space or time slot.
is repairing of machinery consider as works contracts -ahadev - sahadevpatel@hotmail.com (Posted On: 25 Aug, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” So repairing of machinery is considered will be considered as work contract service, if there is transfer of property in goods involved (i.e. material should be used in such repairing) in execution of such repairing.
We have agency of cement. V r supplying cement to builder from ultratech and annually v are getting annual incentive based on qty sale achieved by us. Is incentive received is taxable as service tax? And as discussed earlier there are some transaction where cement directly delivered to builder by company & we get commission on and we are paying service tax but some company giving cash discount to us & also incentive based on quantity sale achieved for this direct billing transactions. (in this case billing of sales is directly done by company to builder v keep deposit with company for the this transactions and as and when builder pay to company we get deposit refund from company). is cash discount & incentive received for this type of transactions taxable as service tax? Bharat Mange (Posted On: 24 Aug, 2012)

The nomenclature of amount paid does not decide the service tax liability. The nature of transaction decides the service tax liability. If you are purchasing material from Ultratech and then selling to builder then it is a trading activity. Any incentive received in such type of transaction is discount only and not service tax is payable on the same. “Service” has been defined in clause (44) of the new section 65B and means – “any activity carried out by a person for another for consideration, and includes a declared service” Further ‘service’ does not include – “Any activity that constitutes only a transfer in title of (i) goods or (ii) immovable Property by way of sale, gift or in any other manner" In the first case the incentive is not a consideration for service (as service does not include “activity constitutes only a transfer in title of goods”) and in nature of discount on sale. Therefore service tax is not leviable. If Ultratech is supplying the material directly to builder and commission is paid to you then you are a service provider. For this transaction either you receive commission or cash discount or incentive, service tax should be leviable as you are not selling the goods and only works as commission agent.
Under the revere charge, my company has made the payment to service provider in the month of August hence compay deposited service tax under reverse charge on 05.09.2012, now my question is whether company can avail the input service crdit (Reverse Charge) against the service tax libility of the month of August or against the ST liability of the month of September-12? Navin Jain (Posted On: 23 Aug, 2012)

The relevant proviso of Rule 4 (7) of Cenvat Credit Rules is reproduced below: “Provided that in case of an input service where the service tax is paid on reverse charge by the recipient of the service, the CENVAT credit in respect of such input service shall be allowed on or after the day on which payment is made of the value of input service and the service tax paid or payable as indicated in the invoice, bill or, as the case may be, challan referred ion Rule 9” So you can take Cenvat credit when payment of value of service and as service tax thereon will be paid. However, it is to be noted that the service tax liability under reverse charge is to be paid in cash only. If you have any service tax liability as service provider or central excise duty payment as a manufacturer then you can take and utilize this credit.
Prior to coming to force the negative list w.e.f. 1.7.12 the item "rice" comes under Agricultural produce, as was specifically mentioned in the definition. However in the negative list it has not been clearly specified. Therefore you may kindly clarify whether "Rice" comes under Agricultural produce or not. Ch Bhaskara Sarma - cbsarma53@gmail.com (Posted On: 23 Aug, 2012)

Section 65B(5) defines Agricultural Produce as follows: “Any produce of agriculture on which either no further processing is done or such processing is done as is usually done by cultivator or producer which does not alter its essential characteristics but make it marketable for primary market” So rice will also covered under the definition of ‘agricultural produce’ but only upto when there is no any further processing is done or processing is done for making it marketable in Primary Market by cultivator.
Dear Sir, We are getting water supply from "SIDCUL" (this is a Government of Uttarakhand Enterprise, was incorporated as a Limited Company in the year 2002,) not charging any service tax, Could you please Confirm whether we have to Pay service tax based on reverse charge mechnasim, notification number 30 as government support services as stated under serial number 6. Raj Anand (Posted On: 23 Aug, 2012)

Sl. No. 6 of Notification No. 30/2012-ST provides reverse charge in respect of support services provided by Government or Local Authority as follows: “in respect of services provided or agreed to be provided by Government or local authority by way of support services excluding,- (1) renting of immovable property, and (2) services specified in sub-clauses (i), (ii) and (iii) of clause (a) of section 66D of the Finance Act,1994 Further meaning of government is not defined in the Act or Rules related to service tax. Therefore meaning of ‘Government’ as given in General Clauses shall be adopted for this purpose (as also given in CBEC,s education guide on service tax). Going through the meaning as given in Section 3 (23) of General Clauses Act, 1897 we conclude that: • ‘Government’ includes both Central Government and any State Government. • The Central Government means the President and the officers subordinate to him while exercising the executive powers of the Union vested in the President and in the name of the President • The State Government means the Governor or the officers subordinate to him who exercise the executive power of the State vested in the Governor and in the name of the Governor. The manpower of Company does not become officers subordinate to the President under article 53(1) of the Constitution and similarly to the Governor under article 154(1). Therefore a company is not covered under the definition of Government. Further a company is also not covered under the definition of Local Authority. So, reverse charge will not be leviable in the instant case.
We are service receivers for Transportation by Road and have been paying Service tax. A Govt.Undertaking order for goods with transportation charges to be paid by them (The Govt.Undertaking)includes Service tax and we have to furnish money receipt of the whole amount from the transporter; so we had to pay the Service Taxes on Freight also to the Transporter and liability to pay lies on them; are we doing it correctly although we are the Service Receiver liable to pay the Service Tax to the Govt.; please clear my doubt Sir Unnikrishna Menonj (Posted On: 23 Aug, 2012)

Firstly your question is not clear that what you want to say. Secondly, since your question is related to reverse charge under GTA service, so we are stating here the related provisions. Notification No. 30/2012-ST (Reverse charge mechanism) provides that “in respect of services provided or agreed to be provided by a goods transport agency in respect of transportation of goods by road, 100% service tax is payable by service receiver”. Further the explanation given in the said notification in respect of GTA service is as follows: “Explanation-I. - The person who pays or is liable to pay freight for the transportation of goods by road in goods carriage, located in the taxable territory shall be treated as the person who receives the service for the purpose of this notification”. So effectively liability to pay service tax under services provided by Goods Transportation Agency will be on the person who pays or is liable to pay freight.
Dear Sir, What is the present abatement rate for the Insectisides and pesticides,fungicide. which notification applicable, is still the 49/2008 is applicable as and when it is amended or is it supperseeded. Regards, HN Manjunatha Manjunatha (Posted On: 23 Aug, 2012)

There is no change in rate of abatement in respect of products i.e. Insecticides, fungicides, herbicides, weedicides and pesticides of chapter Head 3808 and the current rate of Abatement is 30% of Retail Sale Price.
Dear sir, please advise whther installation charges on purchase of new split AC would be cover under the new definition of work contract service as it includes supply of material (i.e AC) and labour charges (i.e installation). Vikash Sharma (Posted On: 21 Aug, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” So the purchase and installation of AC is covered under the above definition of work contract because there is transfer of property in goods involved in execution of such contract for the purpose of carrying out installation. And according to provision of Rule 2A of service tax (determination of Value) Rules 2006, “(i) value of service portion in execution of a work contract shall be equivalent to the gross amount charged for the work contract less the value of property in goods transferred in the execution of the said work contract” So effectively value of service portion in execution of work contract shall be equivalent to Installation charges i.e. Gross Amount Charged (excluding VAT/Sales tax) – Value of AC. But if it is not feasible to divide the material and labour charges then the service tax will be payable on 40% of complete value.
Hi, We are a ltd concern and we have many transporter for sending a goods of various locations in India through Truck. He has been charged the amount of bill on monthly basis against GR Notes. So kindly guide me for deposit of service tax in some condition mentioned below :- 1. If GR is below Rs.750/- 2. If GR is above Rs.750/- and material send on Full Truck Load basis. So, Please given the solution. Gurpreet Singh (Posted On: 20 Aug, 2012)

Notification No. 25/2012-ST exempts following: “21. Services provided by a goods transport agency by way of transportation of - (a) Fruits, vegetables, eggs, milk, food grains or pulses in a goods carriage; (b) Goods where gross amount charged for the transportation of goods on a consignment transported in a single goods carriage does not exceed one thousand five hundred rupees; or (c) Goods, where gross amount charged for transportation of all such goods for a single consignee in the goods carriage does not exceed rupees seven hundred fifty;” So 1. If GR is below Rs. 750/- it will be exempt. 2. If material is send on Full Truck Load basis (i.e. only one consignment), it will be exempt if transportation cost shall not exceed Rs. 1500.
Respected Sir, Under the reverse charge, the due date of deposit to service tax is 5th/6th of the following month or the date when we make the payment? NAVIN JAIN (Posted On: 20 Aug, 2012)

Rule 7 of Point of Taxation Rules, provides that: “The point of taxation for the service receiver liable under reverse charge is the date on which payment is made to the service providers”. Further the proviso to Rule 7 provides that in cases “where such payment is not made within a period of six months of the date of invoice, the point of taxation shall be determined as if rule 7 ‘does not exist’.” So under the reverse charge mechanism, for receiver due date of deposition of service tax is 5th/6th day immediately following the month in which payment is made. But if the payment is not made within six months then date shifts to date of invoice. Consequently, service tax has to be paid along with interest.
Dear Sir, What is the Current % of abatement in case Civil Construction. Regards 09997190077 Raj Anand - rajkumar_anand@rediffmail.com (Posted On: 18 Aug, 2012)

If the civil construction is along with material then it fall under “works contract”. Thereafter, the service provider should bifurcate the value of material and labour charges. The service tax is payable on labour charges. If he is not able to divide the contract price in labour and material charges then taxable value in case of original work will be 40% and 60% in case of finishing work. The service tax is to be paid on such value. Now, if the service provider is individual, HUF or partnership firm and service recipient is a body corporate then reverse charge mechanism will apply. The service provider has to pay 50% of tax and rest of 50% is to be paid by the recipient.
Dear Sir, We have 1 pvt ltd co and 1 propriter concern we received service f0r Manpower and security and having Amc for Computer what percentage of tax to be paid to service receiver Kindly Help Halaswamy K M (Posted On: 18 Aug, 2012)

Reverse charge on Manpower supply service and security service is applicable when: ““service is provided or agreed to be provided be any individual, HUF or proprietary firm or partnership firm, whether registered or not including AOP located in the taxable territory to a business entity registered as body corporate” So if the reverse charge is applicable (i.e. above condition fulfilled) the portion of service tax payable by service receiver is 75% of service tax i.e. 12.36*75% = 9.27% effectively.
dear Sir, whether Houskeeping/loading-unloading contract given by Company to Individual is covered under Manpower recruitment(PRC)? Vinay Arwade - sv.arwade@gmail.com (Posted On: 18 Aug, 2012)

Rule 2(g) of Service Tax Rules, 1994 defines supply of manpower to means: “Supply of manpower temporary or otherwise to another person under his superintendence or control” So under the manpower supply service, service provider shall only be responsible for supply of manpower and the manpower will work under the supervision and control of service receiver. Since in your case there is a contract for Housekeeping/loading-unloading and manpower is not under the control of service receiver (i.e. company) therefore it is not covered under the Manpower supply service and only a contract for work, hence reverse charge is not applicable. Further if the service provider (i.e. individual) is only supply the manpower and manpower is worked under the control or supervision of service receiver (i.e. company) then it will be manpower supply service and reverse charge will be applicable.
AMC given for Machine where sale of Property does not include, then, whether it is covered under works Contract OR Not? vinay Arwade - sv.arwade@gmail.com (Posted On: 18 Aug, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” For work contract service there should transfer of property in goods involved in execution of such contracts. Since you are saying there is not transfer of property in goods involved so the service will not be work contract service.
whether job contract ( No maretial involved, work done throgh manpower)is covered under reverse mechanism. (Posted On: 18 Aug, 2012)

Vide notification 30/2012, reverse charge have been applied on manpower supply service, work contract service and other services. Further rule 2(g) of Service Tax Rules, 1994 defines supply of manpower to means: “Supply of manpower temporary or otherwise to another person under his superintendence or control” So under the manpower supply service, service provider shall only be responsible for supply of manpower and the manpower will work under the supervision and control of service receiver. But under the job work where no transfer of goods involved, the manpower is worked under the control of job worker i.e. service provider, therefore it is not covered under manpower supply service and reverse charge will also be not applicable.
Thanks for your timely clarification Sir. From the definition of works contract it would be clear that all contracts involving the supply of materials and labour in respect movable or immovable property payment of service tax on service portion of such contracts will attract under reverse charge. Pure labour contracts where supply of labour only is involved will not cover under reverse charge. Nagarajan V - nagarajan@rjpinfotek.com (Posted On: 18 Aug, 2012)

Pure labour contract is not covered under the definition of work contract as given under section 65B. Further we have to see whether the above referred pure labour contract is covered under the definition of manpower supply service or not. If it is manpower supply service, reverse charge will be applicable. Rule 2(g) of Service Tax Rules, 1994 defines supply of manpower to means: “Supply of manpower temporary or otherwise to another person under his superintendence or control” Therefore if pure labour contract is not covered under the manpower supply service ( i.e. manpower will work under the supervision and control of service receiver and the service provider shall only be responsible for supply of manpower) then reverse charge will not be applicable otherwise applicable.
As per Notification 30/2012, reverse charge mechanism for payment of service tax is applicable for manpower services provided by individuals, partnership firms, AOP and received by Companies. Does this mean, manpower services provided by a Company to other business entities is exempt from reverse charge mechanism and that Company will include entire service tax liability in the invoice R Ramesh - ramesh75@vsnl.net ? (Posted On: 18 Aug, 2012)

yes, reverse charge under Manpower supply service is applicable when “service is provided or agreed to be provided be any individual, HUF or proprietary firm or partnership firm, whether registered or not including AOP located in the taxable territory to a business entity registered as body corporate located in taxable territory”. There if service provider is company, reverse charge will not be apply and 100% liability to pay service tax will be on company.
In case of companies running multiplaxes, significant expense incurred on printing of leaflets for movie schedule. In such case vendor design leaflets as per specification of multiplex company. and uses paper, ink etc. to design leaflets. My question is that whether it is work contract services new definition of work contract, if yes, how the valuation of service tax will be made in following two conditions: 1. if vendor charges VAT on full amount of invoice, 2. if vendor charges VAT on partial value of invoice. Vikash Sharma (Posted On: 17 Aug, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” Under the contract with company there is transfer of property in goods involved and contract is leviable to tax as sale of goods. Further the definition stated that the contract should be “for carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” Designing of leaflets is not an activity given under the definition of work contract e.g. construction, erection, commissioning, installation etc. therefore it is not a work contract service under the service tax law.
Sir, a) a whole time director has let out a building to the Company , which is used by an employee . Would this rent payment would be within the purview of reverse tax introduced recently (b) Similarly a director charges for his professional services (as CA ) to the Company .Would this be covered under Reverse charge if the bill is inclusive of service tax claimed by him? subramanian (Posted On: 16 Aug, 2012)

(a) The CBEC has been introduced reverse charge mechanism on services provided by directors through the Notification No. 45/2012 dated 07/08/2012. The relevant Para is as follows: ““5A in respect of services provided or agreed to be provided by a director of a company to the said company” The notification does not specify that which services provided by directors are covered under the reverse charge mechanism? The interpretation of above Para makes it clear that every services provided by director of company will cover under the Reverse charge mechanism and company is liable to pay 100% service tax in respect of services provided by directors under the Reverse charge mechanism. So rent payment is also covered under the reverse charge mechanism. (b) In case of services provided by directors to company, 100% liability on company to pay service tax on company under the reverse charge mechanism. The reverse charge is mandatory not an option. If the bill is inclusive of service tax and it is mentioned on the face of invoice then calculation can be done on cum-price basis and service tax will be paid accordingly. Also, the payment will be made to director after deducting service tax.
Sir, Some of my friends formed a private ltd., Co for imparting commercial training and coaching in computer net working. This service is already covered under Service tax net. Besides training they are also purchasing and selling Microsoft online exam vouchers whereby the students who purchase the vouchers shall appear computer online exams conducted by Microsoft. Microsoft releases these vouchers as prepaid exam fee vouchers. Kindly advice whether the purchase and sale of these vouchers would be classified as sale or service after introduction of negative list of services from 1.7.12 as prior to that the transactions were regarded as sale only Nagarajan V (Posted On: 16 Aug, 2012)

Firstly your question is not clear that coaching institute is worked as agent of Microsoft and charge commission or providing any services relation to this e.g. carried out online exam in their institute or only trading the prepaid voucher and earns profit. Secondly: ‘Service’ has been defined in clause (44) of the new section 65B and means – “any activity carried out by a person for another for consideration, and includes a declared service” Further ‘service’ excludes “any activity that constitutes only a transfer in title of (i) goods or (ii) immovable property by way of sale, gift or in any other manner”. So trading of goods is exempt from service tax. Further activities of commission agent who sells goods on behalf of another will not be included in trading of goods. The purchasing and selling Microsoft online exam vouchers is a trading activity but if coaching institute work as a agent and consideration is commission not profit then it will be taxable and commission charges will be value of service Further from the Microsoft point of view, since it provides service i.e. carried out online exam or online course will be taxable.
Sir, we are labour contractor engaged in plant operation but we billed on Tonnage Basis. What should be our rate of service tax G P Nanda (Posted On: 14 Aug, 2012)

Whether Manpower Supply Service or not service tax will leviable @12.36% (including cess). For reverse charge applicability (where service receiver is also liable for payment of service tax) we have to see whether service is manpower supply or not because under manpower supply service reverse charge is applicable. Rule 2(g) of Service Tax Rules, 1994 defines supply of manpower to means: “Supply of manpower temporary or otherwise to another person under his superintendence or control” Thus the essence of the service is that the service provider shall only be responsible for supply of manpower. The manpower will work under the supervision and control of service receiver. Since you are billed on Tonnage basis and also not fulfilled the essential condition of manpower supply service i.e. “the service provider shall only be responsible for supply of manpower and the manpower will work under the supervision and control of service receiver” So your case is not a manpower supply service and is a contract for work only therefore reverse charge will not be applicable.
kindly clarify whether service potion of works contracts mentioned in Notification No 30/2012-ST dt 20.06.12 refers to civil and construction contracts only or otherwise for payment of service tax under reverse charge mechanism. Nagarajan V (Posted On: 13 Aug, 2012)

Notification 30/2012-ST prescribes reverse charge “in respect of services provided or agreed to be provided in service portion in execution of works contract”. The notification prescribes reverse charge for work contract service and work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” So if the activity is covered under the above definition of work contract, reverse charge will be applicable.
Dear Sir, whethere PRC ( Manpower recruitemnent) is applied If a company given a contract for housekeeping/loading/unloading /material handling contract to individual? vinay Arwade (Posted On: 13 Aug, 2012)

Notification no. 30/2012-ST prescribes reverse charge in respect of manpower supply service when “Service is provided by individual, HUF, Proprietary Firm or partnership firm and received by company or body corporate” Whether reverse charge is applicable in your case or not will depend on whether the service provided by individual is covered under the definition of manpower or not: Rule 2(g) of Service Tax Rules, 1994 defines supply of manpower to means: “supply of manpower temporary or otherwise to another person under his superintendence or control” Thus the essence of the service is that the service provider shall only be responsible for supply of manpower. The manpower will work under the supervision and control of service receiver. So in your case if service provider (individual) only be responsible for supply of manpower and that manpower is worked under the supervision or control of company, then it will be manpower supply service and reverse charge will be applicable and otherwise it is only a contract for work. Therefore it depends on whether the manpower is worked under the supervision or control of company or not.
Whether Drilling work for coal exploration comes under the perview of 'Works Contracts' under service tax? KUMARI PRATIBHA (Posted On: 13 Aug, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” Thus, it is necessary that the transfer of property in goods takes place if a contract has to falls under works contract. Under the drilling work there is not transfer in property of goods involved so it will not be covered under the work contract service. But if there is any transfer of property in goods in such drilling process then the service tax will be applicable.
dear sir,please specify the portion of service tax deposited by the service provider will be borne by the service receiver or the same will be borne by the service provider out of his own pocket? KUMARI PRATIBHA (Posted On: 13 Aug, 2012)

Service tax is collected by service provider from service receiver on value of service so it will be born be service receiver. Further according to section 67 (2), “Where the gross amount charged by a service provider, is inclusive of service tax payable, the value of such taxable service shall be calculated by back calculation so that with addition of service tax payable, the total amount is equal to the gross amount charged”. So in case where service tax is not collected or not paid be service receiver it will be deemed as included in gross amount charged and will be computed by back calculation and according payable by service provider.
Dear sir, Under reverse charge Notification no. 30/2012 who will bear the actual liability of service tax? for example :-under works contract 50% of srevice tax will be paid by service provider and 50% by service receiver. now my query is whether service provider will pay the 50% share to govt. out of his own poket or by taking it from his service reciver's poket? KUMARI PRATIBHA (Posted On: 13 Aug, 2012)

whether reverse charge or not the liability ultimate liability to pay tax on service receiver only. Under the above case service provider will charge 50% service tax from service receiver and will deposited the same to government and remaining 50% amount of service tax will directly be deposited by service receiver.
Dear sir, whether educational trust imparting and running religious teaching school will attract service tax. Onali modi (Posted On: 12 Aug, 2012)

‘Service’ has been defined in clause (44) of the new section 65B and means – “any activity carried out by a person for another for consideration, and includes a declared service” Further Notification 25/2012-ST exempt “services by an entity registered under section 12AA of the Income-Tax Act, 1961 by way of charitable activities” And charitable activities includes “k(ii) advancement of religion or spiritually” So if education trust is registered under section 12AA of the Income tax Act, 1961 it is exempt otherwise attract service tax.
SSI Exemption Limits of Rs.10 Lakh; is it applicable for SSI Units regd as Service Receiver and paying Service Tax on Transportation of Good By road on 25% of the Transport Bill ; kindly adise us Sir Unnikrishna Menonj (Posted On: 11 Aug, 2012)

According to Notification No. 33/2012-ST, exemption is not available: “(ii) Such value of taxable services in respect of which service tax shall be paid by such person and in such manner as specified under sub-section (2) of section 68 of the said Finance Act read with Service Tax Rules,1994” Since your case is covered under sub-section (2) of section 68 of the said Finance Act i.e. other person liable under reverse charge so the exemption is not available.
One of my client is Providing Labour manpower in manufacturing plant but service tax number not available and also tunover only 8 lacs so manufacturing plant's liability applicable or not and also accounting what done please explain. Ramesh Uplana (Posted On: 10 Aug, 2012)

The provisions of reverse charge should be applicable when: “The service shall be provided by individual, HUF, proprietary firm or partnership firm including association of person and received by business entity registered as body corporate” As per Item No. 8 of Notification 30/2012-ST, the service tax in respect of manpower supply service is payable: By Service Provider 25% By Service Receiver 75% Under the reverse charge mechanism (when recipient is also liable) exemption of Rs. 10 Lakhs would not be available to service recipient. So manufacturing plant will liable whether provider’s turnover is more than 10 lack or not.
Dear sir, Namashkar ! I have a small properietorship firm registered with central excise department as tour operator -service provider. We mostly provide services to some of Delhi/Mumbai/bangalore based tour operators. Till date we had been raising our invoice on the service receipant (Delhi-Mumbai etc based ) Agents and depositing service tax locally. We now understand that the service tax will now be paid by Service recipant and we do not have to file the same locally. May I request you to clarify on this. The service recipant say that i will continue to raise the invoice the way i have been doing but the tax will now be deposited by them. How do we file our return. Regards Satya (Posted On: 10 Aug, 2012)

Firstly your question is not clear. Secondly under reverse charge mechanism (where receiver is liable ) only some service are covered e.g work contract, hiring of motor vehicle design to carry passenger, supply of manpower, sponsorship etc. The Tour operator service is not covered under the reverse charge mechanism. So service tax is to be paid only by service provider if covered under the tour operator service.
Vide Noti No. 45/2012 dtd 07.08.2012 , now company is liable to pay service tax under reverse charge on services received from Directors of the company. Your Expert views are solicited to enlighten us that which services provided by directors are taxable to the company? Type of services for consideration 1. Amount paid as Remuneration to directors 2. Amount paid as commission / incentive to directors which is a part of total remuneration 3. Amount paid as commission / incentive to directors which is not a part of total remuneration 4. Amount paid on behalf of directors in kind like their personal insurance prem, vehicle prem, medical prem other perquisites 5. Other considerations paid Further, please confirm that can the company avail cenvat credit of service tax paid on aforesaid service for payment of service tax? MANISH THAKKAR (Posted On: 10 Aug, 2012)

1.Applicability of service tax on Directors Section 66(b) defines “Service” as follows “Service means any activity carried out by a person for another for consideration, and includes a declared service, but shall not include- (a) An activity which constitutes merely, (i) A transfer of title in goods or immovable property, by way of sale, gift or in any other manner; or (ii) Such transfer, delivery or supply of any goods which is deemed to be sale with the meaning of clause 29(A) of article 366 of the Constitution; or (iii) A transaction in money or actionable claim; (b) a provision of service by an employee to the employer in the course of or in relation to his employment; (c) fees taken in any Court or tribunal established under any law for the time being in force.” Accordingly the services performed by a director (other than a provision of service by an employee to the employer in the course of or in relation to his employment) of a company fall within the ambit of taxable services with effect from 1st July, 2012. It means service tax would be applicable on Services provided by Independent/Non-Executive Directors of the Company (NEDs) because Managing Director/Executive Director/Whole time Director is the employee of company. But if any amount paid to Managing Director/Executive Director/Whole time Director which is not covered under “a provision of service by an employee to the employer in the course of or in relation to his employment” will be taxable. Therefore for in case of independent directors service tax will be applicable and for Managing Directors/Executive Directors, service tax may be applicable if amount paid other than “in the course of employment”. Managing Director/Executive Director/Whole time Director: 1. Amount paid as Remuneration to directors (excluding those amount which is not in course of employment):- will not be taxable. 2. Amount paid as commission / incentive to directors(whether included in remuneration or not):- Since it is amount not covered under the above mentioned exclusion (i.e. not covered under “during the course of employment) will be taxable. 3. Other consideration:- Taxable if not treated as charges during the course of employment. So the taxability will be dependent on whether there is “a provision of service by an employee to the employer in the course of or in relation to his employment” or not. 2.Input credit of service tax on service provided by directors Rule 2(l) defines “input service” and according to this company can take the credit of service tax paid on services provided by directors but input service excludes “services used primarily for personal use or consumption of any employee”. So service tax on director’s personal expenditure (paid by company) e.g. insurance premium, vehicle premium, medical premium etc. will not be eligible for credit.
Dear sir, Can we take cenvat credit on our employees hotel stay and food bills during their official visit to projects/Sites Ranbir Singh (Posted On: 09 Aug, 2012)

The definition of input service is given in the Rule 2(l) of Cenvat Credit Rules, 2004 and it is as follows: “input service” means any service, – (i) used by a provider of taxable service for providing an output service; or (ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal, and includes services used in relation to modernization, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services, inward transportation of inputs or capital goods and outward transportation upto the place of removal; Further input service excludes: Services such as those provided in relation to outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits extended to employees on vacation such as Leave or Home Travel Concession, when such services are used primarily for personal use or consumption of any employee;”. So Cenvat credit of services of employee’s hotel stay and food bills during their official visit to projects/Sites will be allowed as input service because the above exclusion is extended to employees on vacation such as Leave or Home Travel Concession, when such services are used primarily for personal use or consumption of any employee.
Construction Sir under old regime ,Prime location charges, car parking construction, transfer charges and other allied charges are liable to tax @ of 10% ( full rate), now w.e.f 01/07/12, new concepts of bundled service introduced. So can these charges be treated as construction service (bundled) and accordingly liable to pay abated scheme i.e tax on 25% (with land) even if charged separately shown in agreement and in invoice. Thanks ram (Posted On: 09 Aug, 2012)

Section 66F (3) is follows: “(a) If various elements of a bundled service are naturally bundled in the ordinary course of business, it shall be treated as provision of a single service which gives such bundle its essential character (b) If various elements of a bundled service are not naturally bundled in the ordinary course of business, it shall be treated as provision of a service which attracts the highest amount of service tax.” The section 66F does not make any difference whether charges billed separately or together. So the above question will be depended on that whether the service are naturally bundled in the ordinary course of business or not? Manner of determining if the services are bundled in the ordinary course of business Whether services are bundled in the ordinary course of business would depend upon the normal or frequent practices followed in the area of business to which services relate. Such normal and frequent practices adopted in a business can be ascertained from several indicators few of which are listed below – • The perception of the consumer or the service receiver. If large number of service receivers of such bundle of services reasonably expect such services to be provided as a package then such a package could be treated as naturally bundled in the ordinary course of business. • Majority of service providers in a particular area of business provide similar bundle of services. For example, bundle of catering on board and transport by air is a bundle offered by a majority of airlines. • The nature of the various services in a bundle of services will also help in determining whether the services are bundled in the ordinary course of business. If the nature of services is such that one of the services is the main service and the other services combined with such service are in the nature of incidental or ancillary services which help in better enjoyment of a main service. For example service of stay in a hotel is often combined with a service or laundering of 3-4 items of clothing free of cost per day. Such service is an ancillary service to the provision of hotel accommodation and the resultant package would be treated as services naturally bundled in the ordinary course of business. • Other illustrative indicators, not determinative but indicative of bundling of services in ordinary course of business are – • There is a single price or the customer pays the same amount, no matter how much of the package they actually receive or use. • The elements are normally advertised as a package. • The different elements are not available separately. • The different elements are integral to one overall supply – if one or more is removed, the nature of the supply would be affected. No straight jacket formula can be laid down to determine whether a service is naturally bundled in the ordinary course of business. Each case has to be individually examined in the backdrop of several factors some of which are outlined above.
How much Service Tax amount to be Charged / paid on Man Power Supply Bill as per Service provider and Service Receiver. Suppose A Bill amounting Rs. 1000/- then what would be the Service Tax calculation basis vide Notification 30/2012 Service Tax. Please clarify. S. K. Roy (Posted On: 07 Aug, 2012)

As per Item No. 8 of Notification 30/2012-ST, the service tax in respect of manpower supply service is payable: By Service Provider 25% By Service Receiver 75% The above provisions of reverse charge should be applicable when: “The service shall be provided by individual, HUF, proprietary firm or partnership firm including association of person and received by business entity registered as body corporate” So if value of service is Rs.1000/ and above condition is fulfilled (i.e. provided by be provided by individual, HUF, proprietary firm or partnership and received by business entity registered as body corporate) the service tax payable by service provider and service receiver will as follows: Service provider (1000*12.36%)*25% = Rs. 31 Service Receiver (1000*12.36%)*75% = Rs. 93
Imported goods under CETSH 84 in India on payment of Customs duty, after import it’s quality get check, change the packing, put fresh label, as per Section 2(f)It is amount to manufacture or otherwise? (Posted On: 07 Aug, 2012)

Section 2(F) manufacture includes any process: (i) incidental or ancillary to completion of manufactured product; (ii) which is specified in relation to any goods in the Section or Chapter notes of the first schedule to the Central Excise Tariff Act, 1985 as amounting to manufacturing or (iii) which in relation to goods specified in the Third Schedule involves packing or repacking of such goods in a unit container or labeling or re-labeling of containers including the declaration or alteration of retail sale price on it or adoption of any other treatment on the goods render the product marketable to the consumer Thus, the process undertaken by you will amount to manufacture if the goods falls under Third schedule. The Third schedule relates to goods falling under MRP based valuation under Section 4A of Central Excise Act.
Respected Sir, I want to Know that if invoice including service tax only whether it will be fall under work contract service also or not and whether both vat and service tax must be mentioned for the judge of work contract? NAVIN JAIN (Posted On: 06 Aug, 2012)

work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” Thus, it is necessary that the transfer of property in goods takes place if a contract has to falls under works contract. In the invoice it may be possible that VAT is not shown because of there is an exemption under the VAT Act or otherwise. So it is not a test for identify work contract service that VAT is shown in the invoice or not. The real test, as narrated above, is transfer of property in goods.
Sir One of my client is printing books on job work basis. The purchaser of books provides us the paper and we perform the printing part. Are we liable to service tax ? Neeraj Agarwal (Posted On: 06 Aug, 2012)

we have already replied in your earlier query that service tax is not applicable on the job work of printing of books. The Mega exemption notification provides a clause for the printing industry, which is reproduced below:- “30. Carrying out an intermediate production process as job work in relation to:– (a) agriculture, printing or textile processing;” Thus, if the process undertaken by you is intermediate process then no service tax is applicable on the same.
In the case of WCT like an AMC contract where the vendor is not charging VAT which might be because his turnover is less than exemption limit and also not charging service tax because of exemption limit or supplying free materials and services though the service receiver is aware that is a WCT.Can the SR take the shelter of the fact that the SP is not charging VAT and not pay ST under new RCM though the word used in 'levied' and not 'paod and 'payable' view response Manish K Joshi (Posted On: 05 Aug, 2012)

According to definition of work contract as given in section 65B(54), there should be transfer of property in goods involved in execution of the contract which is leviable to tax as sale of goods. The leviable of tax only means that as per charging section of VAT Act shall be leviable on transfer of property. However it may be exempt by any notification and the exemption by any notification does not mean that the tax is not leviable. Further the service receiver should independently examine that there is his liability or not and not take the shelter of fact that service provider is not charging Service tax or VAT. For example, service provider may be claiming threshold exemption of Rs. 10 Lakhs under Notification 6/2005 but the benefit of the same is not available to service recipient when ST is payable under Reverse charge method.
my Query is, can registered dealer forward cenvat credit to some customer not all customers or full cenvat forward. SOMNATH (Posted On: 04 Aug, 2012)

The dealer can pass on the Cenvat credit to his buyers. He cannot pay the duty. If a consignment is entered in RG 23 D register and it is sold into various consignments then central excise invoice is to be prepared. This is irrespective of the fact that the credit is passed on or not. The duty details are required to be shown as the same are essential for return filing also.
whether Cheque return charges" is taxable or not. Actually it is 'tolerating an act or situation' which is declared service. Once an activity is specified as 'declared service' (deemed service) then the arguement that there is no service cannot stand. deepak (Posted On: 04 Aug, 2012)

Yes, once an activity is specified as declared service then argument that there is no service cannot stand. Further cheque return charges is not a fine or penalty for violation of any law and it is just a fines or penalty levied during the course of business and are taxable.
i am company given a contract to x for digging of canal for a total consideration of say 10lacs for which i am not supplying any thing i.e me material etc., is this falls under works contract or manpower supply contract p madhava (Posted On: 03 Aug, 2012)

Work contract is defined in the section 65B, which reads as follows: “(54) work contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such properly” There should be transfer of property in goods involved in execution of the contract which is leviable to tax as sale of goods. Thus, under the digging contract, if there is no transfer of property in goods involved then it will not fall under works contract. But if involved then it will be work contract service. This will not fall under man power supply as the total digging contract is given for Rs. 10 Lakhs and not manpower is supplied to do this job under the supervision of client.
Concept of naturally bundle service in hotel Hotel has a package i.e Room rent : 2800/day Dry clean : 100/day Health club : 200/day Food : 800/day Total : 3900/day Hotel is taxable @ 60% of value i.e effective rate is 7.2% Is hotel is liable to pay 7.2% on whole 3900/- or item wise as dry clean & health club at full rate deepak (Posted On: 03 Aug, 2012)

According to clause 3(a) of section 66F, ”if various element of such service are naturally bundled in the ordinary course of business, it shall be treated as provision of single service which gives such bundled essential character;” Since it is told in the query itself that it is naturally bundle service, then the person comes in a hotel for stay in rooms. Hence the room service is single service which gives the bundled service its essential character. Therefore service tax is leviable on 60% value on whole amount of Rs. 3900/- as “renting of hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes” service.
I have a query regarding basic exemption limit in service tax. My client is a proprietor earning commission income of Rs.6.00 lakhs from ABC company. He has entered into partnership and is earning commission income of Rs.8.00 lakhs from same company ABC. My question is weather for calculating basic exemption limit of proprietorship concern Rs.10.00 lakhs, his share of income from partnership will be taken or not? alfa (Posted On: 01 Aug, 2012)

Partnership is separately eligible for threshold exemption limit of Rs.10 lakh and while calculating basic exemption limit of Rs. 10.00 lakhs for proprietorship, share of income from partnership will not be considered. Further according to notification 33/2012, in case of service provided from more than one premises, the aggregate value of all the premises should be considered for the purpose of availing the exemption of Rs. 10 Lakh.
One of the company is manufacture Ready mix concrete from march 2011. As excise duty on RMC was applicable from March 2011 itself. Company start production in finacial year 2011-2012 & raise invoice (Manufacture) of Rs. 2.3 Cr. in financial year 2011-2012. I suggest that excise duty should pay on Rs. 0.8 cr (2.3-1.5 cr.) @ 1% with no cenvat credit. But other view is that company is not liable to pay excise duty in financial year 2011-2012 as company got benefit of SSI upto 4 Cr. Pls clarify deepak (Posted On: 01 Aug, 2012)

A manufacturing unit is considered Small Scale Industry (SSI) in excise when “total value of clearance of excisable goods for home consumption does not exceed Rs. 4 Crores during previous financial year”. In such case “the unit is not required to pay excise duty till its clearance value reaches Rs. 1.50 Crores.” The above provisions make it clear that the identification of SSI is based on previous year’s turnover not on current year’s turnover. Further if previous financial year turnover is less than 4 Crores than the unit is eligible for exemption upto 1.5 Crores only, not 4 Crores. So if your turnover of 2010-11 is less than 4 Crores than you are eligible for exemption upto 1.5 Crores. You are correct that the Excise duty should be paid on 0.8 Crores.
Noe that the Negative list in Service Tax has become effective, are we to again reregister: we are regd as a SERVICE RECEIVER for transportation of goods by Road availing 75% abatement and paying serv. tax on bal. 25%; Kindly guide Sir Unnikrishna Menonj (Posted On: 31 Jul, 2012)

No, you are not required for re-registration or to amend your existing registration. Now the negative list has been effective and accordingly classification of services is not there. The form for service tax registration i.e. has also been amended and in service classification column of ST-1, the only one entry is shown for all the services as follows: “Service other than in the Negative List” So the above description of service will common for all assessees and there is no requirement of amend the service tax registration
Dear Experts, As per the notification no. 30/2012-Central Excise Tariff, we understand that we can procure the excisable goods from the domestic market without payment of Excise duty by using the Focus Market scheme duty credit scrip but, there is a confusion about the utilization of the said FMS for the Excise duty payment on finish goods. In other words, can we adjust our Excise duty liability on final product against the said FMS rather tan paying the said excise duty by cash or by cenvat credit & if the case is like this then what would be the mechanism to utilize the FMS as there is no change in the form ER-1 yet to taking the effect of this notification?. pls. provide your experts advise in this. Regards Sanjay Sharma Sanjay Sharma (Posted On: 28 Jul, 2012)

Accordingly, to Para 3.17.5(C) of FTP, stated as under:- “Duty Credit Script can also be utilized for payment of Excise Duty on domestic procurement of such items as permitted to be imported under respective scheme.” The objective of duty credit is only to provide benefit on procurement of input and this duty credit scrip can’t be use for payment of excise duty on finished goods. Further the notification no. 30/2012-CE also provides the procedure for that duty credit scrip which is as follows: • The said scrip is registered with the Customs authority at the port of registration (hereinafter referred as the said Customs authority); • The holder of the scrip, who may either be the person to whom the scrip was originally issued or a transferee-holder, presents the said scrip to the said Customs authority along with a letter or performa invoice from the supplier or manufacturer indicating details of its jurisdictional Central Excise Officer (hereinafter referred as the said Officer) and the description, quantity, value of the goods to be cleared and the duties leviable thereon, but for this exemption; • The said Customs authority, taking into account the debits already made and shall debit the duties leviable in these licences, but for these exemptions in or on the reverse of the said scrips and also mentions the necessary details thereon, updates its own records and sends written advice of these actions to the said Officer; • At the time of clearance, the holder of the scrip presents the said scrip debited by the said Customs authority to the said Officer along with an undertaking addressed to the said Officer that in case of any amount short debited in the said scrip he shall pay on demand an amount equal to the short debit, along with applicable interest; • Based on the said written advice and undertaking, the said Officer endorses the clearance particulars and validates, on the reverse of the said scrip, the details of the duties leviable, but for this exemption, which were debited by the said Customs authority, and keeps a record of such clearances; • The manufacturer retains a copy of the said scrips, debited by the said Customs authority and endorsed by the said Officer and duly attested by the holder of the scrip, in support of the clearance under this notification; and • that the said holder of the scrip, to whom the goods were cleared, shall be entitled to avail the drawback or CENVAT credit of the duties of excise leviable under the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 (40 of 1978), against the amount debited in the said scrip and validated at the time of clearance. So the above procedure should be followed and duty credit scrip will not be shown in ER-1.
S. No. Date of completion of service letter/Invoice for demanding advance money Date on which payment recd. Point of Taxation 1. 12 Oct-2012 10 Aug-2012 20 SEP-2012 ? Sir which date is considerd for POT. Thanks Deepak Gupta deepak (Posted On: 26 Jul, 2012)

According to rule 3 of Point of taxation rules, Point of taxation rules will be earlier of Date of invoice, Payment Received or Completion of provision of service Therefore point of taxation is Time of issue of invoice i.e. 10 Aug. 2012 (Here invoice means invoice/challans/bill under rule 4A).
Dear Sir, My company is working as 100 % EOU & exports software services hence not registered under the Service tax up to date but S.T.dept. recently made new changes with negative list. we have paid rent,Insurance charges, Internet services manpower services so is it compulsory to get registration with ST Dept & act as non exporter business. Or any other suitable way to deal with ST dept. Kindly suggest us. Thanks Durgesh S durgesh S (Posted On: 26 Jul, 2012)

According to section 69(1) “every person liable to pay service tax must mandatory make an application for registration to the designated Superintendent of Central Excise”. By notification no. 30/2012-ST, government notifies some service under reverse charge i.e. where service receiver is also liable to pay service tax (partially or wholly). For example in respect of services provided or agreed to be provided by individual advocate or a firm of advocates by way of legal services to a business entity, the 100% liability to pay service tax is on business entity (i.e. service recipient ) and in that case service receiver is required to service registration. So if your company is liable to pay service tax either as service recipient under reverse charge, required to service tax registration. The service of manpower supply is one of such service quoted in your query. Hence you have to get registered and pay service tax.
Sir, My query relates to Service tax liability on export of services. in case if payment is not received within 6 months OR the period as specified by RBI from the date of invoice then we have to pay service tax as per POT 2011. Please tell me now, as on date what is the time period limit according to current provisions of export of service rules or as per RBI ?. Ranbir Singh (Posted On: 25 Jul, 2012)

If payment is not received within the statutory time limit as allowed by RBI, the Point of taxation will be determined as per Rule 3 (i.e. earlier of Advance received, Invoice issued or Completion of provision of service). According to the RBI, current time limit for receipt of payment is 6 months.
Sir, i have a query related to service tax input credit on "Rent a Cab Service". We are providers of Consulting Engineer Service. we are taking taxi services on monthly basis for village inspections, for providing project mgnt. consultancy services etc. that is directly related to our output service then can we take cenvat credit on taxi hire services?. Ranbir Singh (Posted On: 25 Jul, 2012)

We have already answered in the earlier query you have asked that the input credit of service of hiring of motor is allowed to limited assesses. We once again explain the provision in this regard: According to Section 2(i), Input service excludes “(B) service provided by way of renting of motor vehicle, in so for as they relate to a motor vehicle which is not a capital goods” And according to section2 (a) Capital goods includes, “Motor Vehicle design to carry passenger including their chassis, registered in the name of provider of service, when used for providing output service of- (i) transportation of passenger; or (ii) renting of such motor vehicle; or (iii) imparting motor vehicle skills” It means input credit on taxi hire is allowed only to those which are provider of output service of transportation of passenger or renting of motor vehicle or imparting motor vehicle skills. And here is not important that this input service is directly related to your output service.
Respected Sir, please can u tell me that Annexure-19 has to be filled monthly or quarterly.Please guide me in this matter. mehul (Posted On: 24 Jul, 2012)

Annexure- 19 (statement regarding export of excisable goods without payment of duty) should be filled monthly not quarterly.
As earlier Development charges, to the extent they are paid to State Government or local bodies, was excluded from the taxable value levy. But after 01-07-2012 when the concept of service tax is changed then a builder who charged EDC/IDC from buyer although it is statuory liability of builder.Sir what is law on this point. pls clarify Thanks deepak (Posted On: 23 Jul, 2012)

Yes, the EDC/IDC to the extent they are paid to State Government or Local Bodies was specifically excluded from the levy of service tax (D.O.F. No.334/1/2010-TRU dated 26th February 2010). The EDC/IDC charges to the extent they are paid to State Government or Local Bodies is only a statutory liability of builder. According to section 65B service means – “Any activity carried out by a person for another for consideration and includes declare services.” Further there should be “direct” and “immediate” link between activity and consideration. The EDC/IDC to the extent the are paid to state government/local Bodies, is not a “consideration for service” and only the statutory liability and there also no direct and immediate link between activity and consideration (i.e. EDC/IDC). The intention of government for specifically exclude this EDC/IDC was only that this charge is not the consideration for service and only a statutory liability of builder only. So there is still no liability of service tax on EDC/IDC charges to the extent paid to government.
Sir,As per partially reverse charge mechanism w.e.f.01.07.2012, we are taking sevice Tax credit of Rs. 4.944 as mention in Taxi hire bill.i.e. (Basic Value 100 Service tax after abatement@4.944% Rs.4.944, Bill Value Rs.104.94/-. can we take again service tax input credit after payment of ST as per PRC. Ranbir Singh (Posted On: 23 Jul, 2012)

Firstly credit of input service of hiring of taxi is allowed to some limited assessees and the provision in this regard is as follows According to Section 2(i), Input service excludes “(B) service provided by way of renting of motor vehicle, in so for as they relate to a motor vehicle which is not a capital goods” And according to section2 (a) Capital goods includes, “Motor Vehicle design to carry passenger including their chassis, registered in the name of provider of service, when used for providing output service of- (i) transportation of passenger; or (ii) renting of such motor vehicle; or (iii) imparting motor vehicle skills” It means input credit on taxi hire is allowed only to those which is provider of output service of transportation of passenger or renting of motor vehicle or imparting motor vehicle skills. Secondly there is no any Rule or Provision in Service tax and Excise which allowed Cenvat credit at twice on same bill.
while calculating gross value on taxi hire service, ABATEMENT OF 40% can be availed or not? weather ST on office premises lies with service recipient? PHANI KUMAR (Posted On: 23 Jul, 2012)

1. Entry No.9 of Notification 26/2012-ST dated 20.6.2012, provides for abatement for “Renting of any motor vehicle designed to carry passengers Service”. According to this abatement of 60% of Gross amount charged for determination of value of taxable service. Thus service tax is payable on 40% of the gross amount charged. The abatement is allowed subject to the following condition: “CENVAT credit on inputs, capital goods and input services, used for providing the taxable service, has not been taken under the provisions of the CENVAT Credit Rules, 2004.” 2. Rent of office premises (renting of immovable) is not covered under reverse charge mechanism so Service on office premises rent should be paid only by the service provider.
Client is processing raw milk into pasteurized one, packing milk in pouches and refrigerating the same before despatch on behlaf of Mother Dairy. Whether such activity is Negative Service of Manufacture/Production ? PRAVIN SARASWAT (Posted On: 22 Jul, 2012)

The clause (f) of section 66D(Negative list) reads as follows:- “any process amounting to manufacture or production of goods” Hence if processing amount to manufacture then no service tax is payable. The expression “process amounting to manufacture or production of goods” is defined in the section 65B(40) as follows: “a process on which duties of excise are leviable under section 3 of Central Excise Act, 1994 or any process amount to manufacture of alcoholic liquors for human consumption, opium, Indian hemp and other narcotics drugs and narcotics on which duties of excise are leviable under the state Act for the time being in force.” Chapter 4 of Central Excise Act Tariff specifies Dairy products and includes milk and Note No. 6 of Chapter 4 provides: “In relation to products of this chapter, labeling or relabeling of containers or repacking from bulk pack to retail packs or the adoption of any other treatment to render the product marketable to consumers, shall amount to manufacture” Analysis of above provisions makes it clear that the process you are stated in the query i.e. pasteurization, packing, refrigerating are amounting to manufacture. Hence it is covered under the clause (f) of the negative list and no service tax is payable.
Dear sir, In case of transport of goods by road, ST payable only if such services provided by courier or GTA Query: Whether Individual truck owners/operators coming under service tax net?? Regards Ilayaraja (Posted On: 21 Jul, 2012)

According to section 66D following service is exempt “(p) Services by way of transportation of goods- (i) by road except the services of – (A) a goods transport agency; or (B) a courier agency” And according to section 65B: “(26) goods transport agency means any person who provides services in relation to transportation of goods by road and issues consignment note, by whatever name called.” So service tax is applicable when service is provided by a person covered under the above definition of GTA and not applicable to individual truck owners.
sir, we are manufecturing mixture of micronutrients and we are registred with central excise in chepter 31.Now We want to manufecture agriculture grade zinc sulphate which is exempted under chepter 2833 29. we have to add chepter 28 in our registration? Secondally we want to purchase sulphuric acid against CT-2 (duty free)for manufecturing of agriculture grade zinc sulphate now question is that can we purchase sulphuric acid against ct-2 as we will manufecture exempted agriculture grade zinc sulphate. REENA (Posted On: 21 Jul, 2012)

1. According to registration procedure, “The same application form is to be used for intimating any change in the information furnished originally at the time of applying for registration certificate. Manufacture of new and additional products need not to be intimated”. So you are not required to intimate for additional/new product manufacture, however it is appropriate to intimate regarding this through a letter for reference to department. 2. Procurement of Sulphuric acid against CT-2 (duty free) for manufacturing of agriculture grade zinc sulphate:- The entry for this product is as follows in the Notification 12/2012-CE: “Sl No. 86 -- Sulphuric acid, oleum, oxygen and ammonia used in the manufacture of fertilizers” ---Condition No. 2 should be followed. The Condition No. 2 is as follows: “Where such use is elsewhere than in the factory of production, the exemption shall be allowed if the procedure laid down in the Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 2001, is followed” So if the above condition is fulfilled you can procure the goods against CT-2.
sir I want to know whether printing of school books alongwith cost of paper will come under the category of job work or manufacture, if editorial expenses and royalty to writers of such books are paid by the purchaser of such books. CA Neeraj Agarwal (Posted On: 19 Jul, 2012)

Firstly your question is not clear that you want to know from the point of view of service tax or otherwise. We presume that the above query relates to new service tax regime of Negative list applicable from July 1, 2012. The service tax is not applicable if any process amount to manufacture or production of goods. The relevant entry in Section 66D containing Negative list reads as follows:- “(f) any process amounting to manufacture or production of goods.” If the process undertaken by you amounts to manufacture or production then no service tax is applicable on the same. Moreover, the Megha exemption notification also provides a clause for the printing industry, which is reproduced below:- “30. Carrying out an intermediate production process as job work in relation to:– (a) agriculture, printing or textile processing;” Thus, if the process undertaken by you is intermediate process then no service tax is applicable on the same. Since the facts of the case is known to you only, please see your reply in guidance of above.
SIR, FIRSTLY THANKS FOR UPDATING US WHICH HELP A LOT. MY QUERY - W.E.F.01.07.12 BOTH SERVICE PROVIDER & RECEIVER HAS TO PAY SERVICE TAX. THEN HOW SERVICE PROVIDE SHALL PREPARE INVOICE BY ADDING 100 % OF SERVICE TAX OR ONLY HIS LIABILITY OF SERVICE TAX, ADVICE ANAL (Posted On: 18 Jul, 2012)

Under the reverse charge mechanism, service provider and service receiver both are liable the service tax. The service provider is liable only to extent of liability of service provider of his liability under service tax. Hence, he will charge the service tax only to the extent of his liability in his bill.
R/Sir,as per latest notifiacation, can we avail Input tax credit ag. ST liability in respect of residential and commercial construction services on which we have taken exemption benefit 75%? (2)whether covered car parking and power backup charges is taxable under above said services? CA Hawan Kumar Pandey (Posted On: 17 Jul, 2012)

1. Input Tax Credit As per the Serial No. 12 of Notification 26/2012 ST issued by the Central Board of Excise and Customs, the following abatement and their respective conditions are there for availing benefit of 75% abatement in case of “Construction of a complex, building, civil structure or a part thereof, intended for a sale to a buyer, wholly or partly except where entire consideration is received after issuance of completion certificate by the competent authority”: Conditions: i) CENVAT credit on inputs used for providing the taxable service has not been taken under the provisions of the CENVAT Credit Rules, 2004. (ii)The value of land is included in the amount charged from the service receiver. It is clearly evident from the 12th point where it is said that cenvat credit is not allowed on the inputs used in construction of residential and commercial complexes when abatement of 75% has been already availed. But it does not say anything about the Cenvat credit of input services and the capital goods used in the same. So therefore it can be inferred from the above that Cenvat credit on input services and capital goods can be availed against the service tax liability. 2. Parking facility: The negative list exempts the following from service tax liability: “Services by way of vehicle parking to general public excluding leasing of space to an entity for providing such parking facility” Item no. 24 of notification 25/2012, dated 20.6.2012 provides exemption to service of parking of motor vehicles provided to general public. The term General public is defined in Serial No. (q) of para 2 of notification 25/2012-ST dated 20.6.2012 as follows: “‘general public’ means the body of people at large sufficiently defined by some common quality of public or impersonal nature” In the residential society, normally the parking area is allotted to individual members of the society and monthly charges are recovered from them. Such parking facility is not open to general public, but is limited to the members of the society. Similarly, in commercial buildings also, parking area is allotted to the members of the building. Such parking is not open to general public and hence exemption from payment of service tax will not be available to the society collecting the parking charges. Further, the amount of parking charges will be not be included in the amount of construction services. Therefore the parking charges will not be eligible for the abatement and service tax is chargeable @ 12.36%. 3. Power Back up Charges: The Guidance Note on Service Tax clarifies the point on distribution of electricity: Electricity transmission or distribution utility is exempt from service tax when the same is provided by: --- The Central Electricity Authority --- A State Electricity Board ---The Central Transmission Utility (CTU) ---A State Transmission Utility (STU) notified under the Electricity Act, 2003 (36 of 2003) ---A distribution or transmission licensee licensed under the said Act ---Any other entity entrusted with such function by the Central or State Government If charges are collected by a developer or a housing society for distribution of electricity within residential complexes then such services are not covered under this. The developer or the housing society would be covered under this entry only if it is entrusted with such function by the Central or a State government or if it is, for such distribution, a distribution licensee licensed under the Electricity Act, 2003. Therefore, the power back up charges is taxable to service tax @ 12.36%. The same will also not be included in the value of construction services to avail the abatement.
Sir, If Ltd.company have its owned transporation vehicle and freight is recovered from custmer(shown in Invoice), whether we have to pay service tax on such freight. MAHENDRA MODI (Posted On: 17 Jul, 2012)

The clause (p) of section 66D (negative list) reads as follows:- “Services by way of transportation of goods- (i) By road except the services of- (a) a goods transport agency; or (b) a courier agency;” Hence service tax is payable on road transportation if the service is provided by GTA or courier agency. All other services of road transportation are not chargeable to service tax. It means services provided by goods transport agency are taxable and according to section 65B(26), goods transport agency means: “any person who provides services in relation to transport of goods by road and issue consignment note, by whatever name called” The service tax is not applicable on Ltd. company have its owned vehicle as it is not covered under the definition of “Goods transport agency” as well as it does not issues consignment notes.
Dear Sir, Could you pls clarify on the below mention query: Can a job worker clear/despatch the finished goods on behalf of the Principal Manufacturer? If yes what will be the procedure. If you could pls throw some light on the above mentioned query. kavita thanvi (Posted On: 16 Jul, 2012)

Kindly refer Rule 4(6) of Cenvat Credit Rules, 2004. You can dispatch the goods under this Rule. The supplier of goods on job work basis has to apply to Deputy/ Assistant Commissioner for the permission for clearing goods from job work basis. The procedure told by the authority has to be followed.
Whether ST on RENT for office premises, generator is to be paid by service provider/ receiver PHANI KUMAR (Posted On: 14 Jul, 2012)

Use of Tangible Asset service (Rent of Office Generator) is not covered under reverse charge mechanism. So Service tax on rent of Generator is to be paid by service provider.
Whether existing reg is to be amended as per changed ST notification. We are reg under GTA (service recepient) and Input serv distr (recepient), now we have to pay for various servises received via. Taxi , legal charges etc. PHANI KUMAR (Posted On: 14 Jul, 2012)

No, you are not required to amend your existing registration. Now the negative list has been effective and accordingly classification of services is not there. The form for service tax registration i.e. ST-1 has also been amended and in service classification column of ST-1, the only one entry is shown for all the services as follows: “Service other than in the Negative List” So the above description of service will common for all assessees and there is no requirement of amend the service tax registration
Sir, Pls inform us whethere Reimbursable Expenses[ Maximum of Rs 8000 ] to Customs House Agent is covered under service tax . Pls give us Recent Notification to my mail id K Elango (Posted On: 14 Jul, 2012)

According to Rule 5(2) of Valuation of Taxable services, Reimbursement of expenditure on behalf of service receiver is not includible in value of service provided. So Reimbursement of expenditure by custom house agent is not covered under service tax. In Alvares & Thomas v. CCE (2009) 20 STT 466 (Bang.-CESTAT), it was held that payment made by CHA on behalf of client such as Statutory levies and various reimbursable expenditures are not to be included for computing service tax.
Sir ,Pvt ltd co paying freight to Individual truck owners – whether co liable to pay ST… as many CESTAT held that services red from them not liable to ST… reply asap Ilayaraja (Posted On: 14 Jul, 2012)

No only service tax is to be paid only when it is paid to GTA, moreover under the new service tax regime the same may be taxable. However there will no liability on the assessee, since service is not provided by GTA but by Individual truck owners.
Where we are paying service tax to the vendor & claiming the same from the client, the clients are not ready to pay the service tax on the amount we pay to the vendor . In such cases what are the remedies available For. E.g Rs. 100 forklift Service Tax Rs. 12.36 Total Amount Rs. 112.36 Paid to vendor Billed to the client Rs. 112.36 Service charges Rs.100 Total Amount Rs. 212.36 Service tax Rs. 26.24 Billed Amount Rs. 238.60 In the above case client is not ready to pay service tax on the amount we pay to the vendor.He is ready to pay Rs. 100 of forklift Rs. 100 service charges & Rs. 12.36 service tax on on service charge , that means he is ready to pay only Rs. 212.36 to us. Please revert what to so in such cases. Mukesh Jha (Posted On: 14 Jul, 2012)

First of all, your question is not clear, which service you have received and provided? Secondly, whether you are acting as agent or as an principal to principal basis? According to section 67 (2), “Where the gross amount charged by a service provider, is inclusive of service tax payable, the value of such taxable service shall be calculated by back calculation so that with addition of service tax payable, the total amount is equal to the gross amount charged”. So if your client is ready to pay only Rs. 212.36, you can charge this amount (Rs. 212.36) as inclusive of service tax and in that case service tax will as follows: (212.36/112.36)*12.36 = Rs. 23.36
We are availing the following services 1.Taxi (not reg under ST act as T.O is less than 10 lacs) 2.Man poweer service ( not reg as t.o is less than 10 lacs) 3. Legal consultancy (not claiming s.T., SERVICE ENDED ON 30.06.12 but bill given paid on 02.07.12) PHANI KUMAR (Posted On: 14 Jul, 2012)

As per the new reverse charge mechanism, service tax is to be paid by service recipient even if the service provider is availing the exemption based turnover. The liability of service provider and service recipient are different and therefore the service recipient has to pay the service tax on reverse charge mechanism from the first bill raised by service provider itself.
is service tax payable on photocopy and digital printing done by photocopiers. M.Malik (Posted On: 06 Jul, 2012)

Yes service tax is payable since the same is not specified in the negative list.
dear sir, pl. advice - CUSTOMS -EXEMPTION FROM SAD -21/2012 DT.17.3.2012===32/2012 DT. 8.5.2012Basis of this notification, if we declare Maharashtra as the State where the goods are immediately taken after importation for distribution on stock transfer basis, can we avail S.A.D. benefit? SANJIV JOSHI (Posted On: 30 Jun, 2012)

For availing the exemption from SAD as per Notification no.21/2012, you need to declare state where the goods are to be SOLD after being imported, and not to declare state where goods are to be TAKEN after importation. Thus for availing exemption following conditions are to be fulfilled simultaneously (i) the State of destination where such goods are intended to be sold for the first time after importation on payment of value added tax; and (ii) his value added tax registration number in that State.
we are the manufacturers of sugars. we have some dumpers tippers etc which is are capital goods by virtue of the notification. we would like to take cenvat credit on the insurance premium paid on such vehicles. can we take cenvat credit of the same p madhava (Posted On: 29 Jun, 2012)

No. CENVAT credit of the same can’t be taken, since motor vehicle insurance is specifically excluded.
I have amended our RC incorporating another name of Authorised signatory but the RC not yet issued on line after so many weeks; what shud I do now ? Pls advise Unnikrishna Menon (Posted On: 28 Jun, 2012)

First you should check online that whether the same has been filed properly or not, if filed properly that, than you should contact your Superintendent / Assistant commissioner for getting solution of the problem
Now that C Ex. Tariff Noti. No. 18/2012 has been rescinder which Noti. No. is to be given in the ER-1; please advise me. unnikrishna Menon (Posted On: 28 Jun, 2012)

This notification prescribed the rate of duty at 12%. But after enactment of Finance Bill, tariff rate itself is 12%.
Dear Pradeep Ji, pls update the Service Tax Liabilities on In Room Dinning Service of Hotel Industry and also inform the service tax rate for the same. CA Ravikant Tibrewal (Posted On: 28 Jun, 2012)

Earlier when the service tax on Air conditioned Restaurant with liquor was imposed, it was clarified by CBEC vide circular number 139/8/2011-TRU dated 10th May 2011clarified that the food and beverages taken in room is not taxable. Since the service tax under negative list contains the same position and hence the in room dining will be exempt. But the department may say that the circular was applicable for old rules, hence the service tax under negative list is payable on in room dining.
Dear Sir, Whether as per place of provision Rules 2012, wherein sample has been provided for doing testing situated on non taxable territory and finally report is sent to taxable territory, under this situation whether service tax is payable as a receipient of service? Rahul bhatt (Posted On: 27 Jun, 2012)

The shall fall under Rule – 4 Place of Provision of Performance based service i.e Service provided in respect of goods that are required to be made physically available by the recipient of service to the provider of the service. Thus the place of provision would be in Non – taxable territory and no service tax shall be payable.
Dear Sir, Facts: We are having registered office at A State, Corporate office at B State and Site is situated in State C. Now we had received invoice(copmosit) with service tax @4.944%, for the work done at site(State C) office in the address of Registered office(State A).The invoice value is more then 1 Cr. and total contract value is 3 Cr. According to me, It is also liable to WCT-TDS provision under Sales tax law, But confused about the applicability of State Act, Can you guide which state vat act will be applicable State-A or State-C? Thanks in Advance Arpit Patel (Posted On: 27 Jun, 2012)

We are deal only in Excise,Customs,DGFT and Service tax laws. Hence we are unable to answer your query.
Respected Sir, can debit note can be considered as valid for taking of the excisable cenvat credit.? mehul.m.ashar (Posted On: 27 Jun, 2012)

No debit note shall not be considered as valid document for taking CENVAT credit, since it is not mentioned in Rule – 9 of CCR. However in many judicial rulings it has been held that debit note is a valid document for taking CENVAT credit provided it contains details as mentioned in Rule – 9 of CCR’04. Thus you make credit, but department shall object it.
Respected Sir, Your advices and guidance are very much useful to the industry. It is amazing the response time for any type of query with clear explanations in line with the current law and rule. Now, can you please confirm that is there any special notification is issued by customs/excise relating in the import of agriculture power tiller. What is the present Import duty structure for Agricultural Power Tiller please vedachallam (Posted On: 25 Jun, 2012)

Agriculture power tiller is classifiable under Chapter heading no.87.01 as per Customs circular no. 45/2001 dated 07.08.2001 and it is leviable to BCD at 10% and CVD at 4%, there is no Special additional duty leviable on the same
My client has removed finished product & empty packages and given to packers/repackers (without ED) and then got back packaged goods and finally paid excise upon removal (on sale invoice). Is he liable to take excise permission while goods are sent to packers (without ED) ? Debasish Das (Posted On: 23 Jun, 2012)

This can be done under job work procedure. There are many alternatives for doing job work under Central Excise like Notification 214/86, Rule 4(5)(a) etc. You can opt for any one of them seeing the terms and condiitons of each one of them.
Can value base exemption is applicable in case of service wherein service provider and receiver are made liable for payment of service tax rahul bhatt (Posted On: 18 Jun, 2012)

The liability of the service provider and service recipient are different and independent of each other. Thus in case the service provider is availing exemption owing to turnover being less than Rs 10 lakhs, he shall not be obliged to pay any tax. However, the service recipient shall have to pay service tax which he is obliged to pay under the partial reverse charge mechanism.
Dear Sir, I would like to know whether VAT and Service tax is applicable to Service Charge forming part of Banquet bill. If yes then would like to know reason as Service Charge collected from guest is not revenue of the Hotel. res (Posted On: 18 Jun, 2012)

If food is served with Banquet/Mandap, than the same is Composite transaction and both VAT and service tax is chargeable on the same.Abatement of 30% is available, thus taxable portion is 70% and effective rate of tax is 8.65%. All credit of Capital goods,Specified Inputs (Other than chapter 1 to 22 i.e. food and beverages) and input service shall be available
In case of rejection of exported material by overseas customers, what formalities are required to be completed? Amit Jain (Posted On: 18 Jun, 2012)

If the AC/DC of customs is satisfied about identity of goods then goods can be reimported without payment of duty if these are to be exported. (REF: Notification 158/95-cus). If these are not to be exported then the benefits availed at the time of export to be paid back but the satisfaction of AC/DC about identity of good is also mandatory here (REF: 94/96-Cus). The third situation when the AC/DC is not satisfied about the identity of goods then full cusotm duty is to be paid. But at the time of re-export the drawback can be claimed.
We sent some items to sri lanka under CT-1. Items are rejected by customer. material reached back at our plant. what is required to be done under excise laws? Documentation, intimation or any other formalities. Amit Jain (Posted On: 18 Jun, 2012)

The procedure for re-import of goods can be done in the following situations 1. The goods shall be re – exported after repair, reconditioning, remanufacturing than applicability of notification no.158/95 shall be there. 2. The goods shall not be re – exported than applicability of notification no.94/96 shall be there. On re-import of indigenously manufactured goods under duty Drawback/rebate claims, export under bond or under other claim of export incentives, essentially the duties equivalent to the export incentives etc. availed have to be paid, on re-importation. Thus, if the goods were exported on payment of Central Excise duty, without claiming any rebate, and without claiming any export incentives such as Drawback or benefits of the duty exemption schemes, EPCG/DEPB schemes, and where the indigenously manufactured goods are being returned then no Customs duties are leviable. The benefit is available if the Assistant/Deputy Commissioner of Customs is satisfied that the goods are the same which were exported earlier and certain other conditions as laid down in the said notification are fulfilled. After importing the same, the procedure under excise is as follows 1. The assessee shall give intimation of the re-entry of each consignment in Form D-3 within twenty-four hours of such re-entry 2. Such goods are to be stored for separately at least for 48 hours from the time intimation is furnished to Range Office or shorter period if verification is done by the Superintendent of Central Excise in the manner mentioned subsequently ; and 3. The assessee shall record details of such goods in the daily stock account and taken in the stock in the factory
Sir, our company gives training in beautician course and provide certificate but not affiliated to any institute,whether we are required to pay service tax? monika (Posted On: 17 Jun, 2012)

According to Section 66B “Service tax will be leviable on all services provided in the taxable territory by a person to another for a consideration other than the services specified in the negative list”. According to Section 66D(l) following service is in Negative List: “Services by way of- (i) Pre-school education and education up to higher secondary school or equivalent; (ii) Education as a part of a curriculum for obtaining a qualification recognized by any law for the time being in force; (iii) Education as a part of an approved vocational education course” But service as your company provides is not covered under the above specify services and also neither covered under any other entry in negative list nor covered under Mega exemption. So service tax will be leviable on service as provided by your company
Dear sir pl guide us that erection comm and install of transmission line towers falls under negative list or taxable service Manish Thakkar (Posted On: 15 Jun, 2012)

Section 66D specifies negative list of services and sub section (k) of Section 66D Covers following service. “Transmission or distribution of electricity by an electricity transmission or distribution utility” But your service is installation and commissioning of transmission line towers, not transmission or distribution of electricity and you are also not an electricity transmission or distribution utility. So service provided by way of erection, commissioning and install of transmission line towers is a taxable service.
Dear Sir, We Would like to inform you that one of the our client is dealing in the export business. he has exporting some of kerosine stove items . We are consulting them to getting the CT-1 Bond (Export Without Payament of Duty) , we getting CT 1 Bond Certificate from the Assistant Commissioner of Income tax . But then After , In the Client has Fill the Form ARE 2 from the Port in which the Goods are Export from the India. Question is that : When we submitting the proof of Export to the department then department has refuced to accept the ARE 2 as proof of Export ? ( Department has Accept only ARE 1 ) Sir give response what to do in above mention problems ? Sir , Please give reply as early as possible so we can consulting the ours Client ? Thankig You Dinesh Maru (Posted On: 12 Jun, 2012)

The query is not clear, however as per our understanding of the query, ARE – 1 has to be given, since export is against CT – 1. ARE – 2 is to be given only for export against CT - 2. Moreover following is to be submitted as POE: 1. Duly attested photocopy of shipping bill (Export Promotion Copy) bearing the particulars and date of clearance document under which the goods are cleared from the factory of production, having endorsement on its reverse by the Customs of the particulars of mate's receipt no. (wherever applicable), name of the ship/ flight no., of the aircraft, vehicle no. - by which the goods were exported out, date of export, and EGM Number/ Airway Bill Number (wherever applicable); 2. Duly Custom's attested copy of Bill of lading; and 3. Foreign Exchange Remittance Certificates.
Sir, Can we avail cenvat credit on the 4% spl.addl duty (SAD) paid on our imports who are into the manufacturers of engines and agri implements please. Our imports on agri-implements will not come under central excise (CVD are not paid) vedachallam (Posted On: 08 Jun, 2012)

CENVAT credit of SAD can be taken only, if the parts are used by your firm in manufacturing excisable goods only. Thus if you are importing the part for manufacture of excisable goods, credit of SAD can be taken.
We are engaged in manufacture, supply of Transmission Line towers. We also provide service of Erection, Commissioning & Installation of transmission line towers for setting up of Transmission Line for various Govt and private companies. We have a query that whether this service falls under negative list of exempted service or taxable service as Govt companies asks us not to charge Service Tax considering that such service is essential for transmission and distribution of electricity and very well fall under the negative list viz. transmission and distribution of electricity. Hence no service tax is leviable. Awaiting for your valued reply. MANISH THAKKAR (Posted On: 08 Jun, 2012)

Yes the same would be liable to service tax as the same doesn’t falls under Negative list of service tax. The exemption has been granted to Transmission or distribution of electricity by an electricity transmission or distribution utility and not to any service provided for the same. Moreover the same shall be regarded as Works contract service if it involves supply of goods which are liable to VAT and tax shall have to be paid as per reverse charge mechanism.
Can 100% EOU cleared export goods on payment of duty if duty balance available last three years. Because assessee fild refund current year of accumulated credit which is hit by Commr.(A) on time bar. Pls.give advice to way for in cash of accumulated credit of eou. UNMESH V. KASHIKAR (Posted On: 07 Jun, 2012)

The accumulated credit can be utilized for payment of duty on DTA clearances or can be claimed as Refund. Moreover, as per Board's circular no. 799/32/2004-CX, DT. 23/09/2004 reproduced as follows: It has been observed that EOUs are entitled to avail CENVAT Credit Scheme w.e.f. 06.09.2004 vide notification No. 18/2004-CE (N.T.) dated 6.9.2004. Thus, the EOUs who receive duty paid goods can avail input credit for the duty paid on such goods and utilize the credit for payment of duty on DTA clearances and if for some reasons, the credit cannot be utilized, the same can be claimed as refund under rule 5 of CENVAT Credit Rules. Thus accumulated balance can be encashed by DTA clearance by EOU.
Respected Sir, one of my clients had sold the machinery in the previous month,alongwith the sale of machinery,the total duty of sale has been Rs.440000.00 & I have the total credit of excise duty of Rs.100000.00,then how to show in the ER-1,in the cenvat page as if I show then the cenvat balance can become negative,so please guide me as soon as possible. mehul (Posted On: 03 Jun, 2012)

Since you have only Rs.100,000 balance in your CENVAT a/c, remaining duty payment has to be done through PLA a/c only.
Honourable President of India has Given its Assent to Finance Bill 2012 or Budget 2012-13 on 28.05.2012. FINANCE ACT, 2012 [Act No. 23 of 2012] An Act to give effect to the financial proposals of the Central Government for the financial year 2012-2013 In view of this and notification Service Tax 12/2012 dt 17March2012(S.No.29(c)), hope, any brokerage released from 28th May2012 onward by mutual fund to its agents will be without deduction of service Tax. Please give your opinion. RAJENDRA KUMAR PHOPHALIA (Posted On: 30 May, 2012)

Though the president has given the assent to Finance Bill 2012 on 28.05.2012, however the date of amendments relating to Indirect taxes has not been notified yet by the government. We will update the same on our website when the same comes into force.
sir, our company is engaged in construction of residential and commercial complexes. sir i just want to know how i should calculate and pay service tax according to the new point of taxation rules suchit shah (Posted On: 29 May, 2012)

As per Point of taxation rules, 2011 service tax is to be paid on raising of Invoice or on happening of event specified in the agreement. Thus if in the agreement it is mentioned that 30% is to be paid on completion of first slab, than it will be regarded as a event and as per POT rules invoice shall have to be issued within 30 days of that event with service tax amount. Moreover service tax will have to be paid on the amount of amount to be received as per the agreement. Moreover, the construction service is regarded as continuous service under point of taxation.
Whether INPUT TAX (BED&C) of Manufacturing can be claimed /adjusted against Output Tax ( Service Tax) on Freight paid in the case of SSI UNIT availing exemption of 1.5 Crore ,which does not claim Cenvat credit of Input Excise Duty against Output Excise Duty payment ? CA RAKESH PRASAD (Posted On: 29 May, 2012)

As per notification no. 08/2003, whenever the manufacture is availing SSI exemption he cannot avail credit on Input on raw material. Thus you can't claim Input duty credit for payment of Outward GTA. Furthermore, the GTA service is specifically excluded from the definition of “output service” under Rule 2(p) of Cenvat Credit Rules, 2004 w.e.f. 1.3.2008. Hence, the credit cannot be taking of GTA service and it has to be paid in cash only.
Dear sir,Our company which is 100% EOU is engaged in the business of manufacturing of medical Molded components . Now we are in the process of doing some DTA sales. Pls let me know what is excise duty we need to charge to the items apart from the VAT. Also let me know any other duty needs to be charged in this regard Thanks Madhuraj (Posted On: 26 May, 2012)

You have to obtain the permission from development commissioner for DTA sale. The clearance from 100% EOU is chageable to aggregate of custom duty if cleared in India. A part of Basic Custom duty is exempted if it it sold within the permissilble limit with the permission of development officer. If we sale above the permissible limit then full custom duty is applicable. Also, if there is no imported input is used in manufacture of your final product then excise duty will be chargeable on the same. If the final product is totally exempted from excise duty then also certain excise duty is charged on the same.
Sir,Can a 100 % EOU export goods on payment of duty and claim rebate? please guide with authority. UNMESH KASHIKAR (Posted On: 18 May, 2012)

No, a 100% EOU cannot export goods by paying duty and later on claiming rebate. They are required to export under bond without payment of duty under Rule 19 of the Central Excise Rules, 2002. They can claim refund of unutilized credit under Rule 5 of Cenvat Credit Rules, 2004.
Sir,We are manufacturer, since service has been rendered before 31.03.12 and bill has also been raised before 31.3.12, only the transporter bill i.e post of delivery (LR)and payment received after 1.4.2012,and In the customer Invoice charge service tax 10.3%. kindly advice the effective rate of tax will be 10.30%? neeraj srivastava (Posted On: 18 May, 2012)

The query is not clear. We understood the query as under:- You are manufacturer and getting services of GTA. LR raised as well as goods delivered before 31.3.2012. But payment made after 1.4.2012. What will be rate of service tax? If this query then the answer is:- The service tax on GTA is to be paid by you i.e. service recipient. The POT says that the service tax is to be paid in such cases (where recipient is liable) on receipt basis. If the payment is made after 1.4.2012 then service tax will be payable at new rates. Even the CBEC circular 158/9/2012 dated May 8, 2012 has also clarified the same.
Sir, We are selling space or time slots for advertisments thru internet (Portal), as we come under Negeative List of Service tax . I want to know from when we can stop collecting ST, from 01.04.12 or from the date of finance bill passed. Can you mentione the finance bill passed date. Regards, Balaji P (Posted On: 15 May, 2012)

The Negative list will be effective after passing of finance Bill. It has three steps:- 1. Pass by loksabha, 2. pass by Rajyasabha; and 3. president assent. First two steps are completed and third has to take place. Hence the Finance bill is not enacted till today i.e. on 21.5.2012.
Dear Sir, Supplier has dispatch the material with Original and Duplicate for Transporter copy of Excise invoice but, in transit the transporter missed both the documents i.e . Original Invoice and Duplicate for Transporter copy of the Excise invoice, pls. tell us what to do to avail the Cenvat Credit of the same with supporting rules, case law etc. in this situation. Regards Sanjay Sharma Sanjay Sharma (Posted On: 15 May, 2012)

Normally, the credit is allowed on "Original for Buyer" or "Duplicate for Transporter" copy of invoice. When the basic fundamentals of Cenvat credit scheme is fulfilled like receipt of material, use of inputs in manufacture of final product and clearance of final product on payment of duty then there are certain case laws which says that the credit will be allowed on xerox copy or extra copy of invoice. A few of them are as under:- 1. Commissioner of Central Excise, Coimbatore v/s M/s Bilt Industrial Packaging Co. Ltd [2009-TIOL-66-CESTAT-MAD 2.Hero Cycles Ltd v/s Commissioner of Central Excise, Chandigarh [2002 (149) E.L.T. 648 (Tri. - Del.)] 3.- J. V. Strips Ltd v/s Commissioner of Central Excise, Delhi [2004 (175) E.L.T. 589 (Tri. - Del.)] 4.Heea Steels Ltd v/s Commissioner of Central Excise, Raipur [2005 (191) E.L.T. 1102 (Tri. - Del.)]
Sir, we are the dealers and authorised service providers of cars. Can we take input credit of service tax paid on house keeping and security service on a common invoice for both show room and workshop. Alternatively should we take separate invoices for show room and workshop. Thanking You. with regards. Srinivas. M.V.S.Srinivas (Posted On: 12 May, 2012)

The better option is to have a separate billing. If the common inovice for showroom and workshop comes then the sale in showroom will be termed as "trading activity". This is defined as exempted service. When you take the credit on common input service and use it for taxaable and exempted service then three options are available to you. First is to go separate inventory which is impossible in your case. Second option is proportionate reversal, which is best option for you but the formula for calculating the same is very difficult. The third and last alternative is to reversal @ 6% on exempted service. This will be more than the credit taken by you. Hence this is also not feasible. Hence the best alternative is to go for separate billing.
Dear Sir, We are supplying the automobiles parts to an automobiles co. we had supplied some parts during the time of Jan- 2012 to March-2012, now automobile company has increased & amended the purchase order retrospectively the price of our parts supplied to them from our co. Now, we have to raise the supplementary invoice due to the rate revision for duty difference but, the rate of excise duty has been change from 10% to 12% from 17.03.2012., So if today, I want to raise the Excise invoice what should be the rate of Excise duty i.e 10 or 12%. Pls. give your opinion on the issue with supporting rules, regulation, case law etc. Regards, Sanjay Sharma Sanjay Sharma (Posted On: 08 May, 2012)

The rate of duty is payable on the date of clearnace of goods from the factory. Hence the duty is payable @10% in instant case. However, the interest will be payable on the same as per Apex Court decision in case of SKF bearings Limited.
Query The Assessee is a News Paper publishing Company and prints and sale its own newspaper. It has spare printing capacity and at times does printing of News Papers as Job work (above Rs. 10 Lacs) for other small newspaper vendors / Other Publishers. 1. Whether the assessee is liable to charge Service Tax on this Job work? 2. Whether considering the notification No-8/2005, it would be liable to charge Service Tax? 3. Whether this job work of printing can get Service Tax exemption considering the Notification no-14/2004? Please advice. Sanjay Mittal (Posted On: 01 May, 2012)

No service tax is required to be collected for jobwork done of printing as the Notification No. 14/2004-ST dated 10.09.2004 clearly exempts service provided in relation to printing done for another person as Business Auxiliary Service.
After 01.04.2008 on which situation service tax credit on outward fright is allowed UNMESH V. KASHIKAR (Posted On: 01 May, 2012)

As per clarification given in Board Circular no. 97/8/2007 dated 23-8-2008, the Credit of Service Tax on Outward freight will be allowed if the following 3 conditions are fulfilled: 1. The sale takes place at the buyer’s door or the property in the goods remains with the seller till the goods reaches buyer in an acceptable condition; 2. The risk of damage to goods during the transit is borne by the seller/manufacturer; and 3. The freight charges are integral part of the price of the goods.
Since service has been rendered & estimate has been given before 31.03.12 but final bill has not been raised till 22nd April 2012. At which service tax rate the invoice should be raised? Nisha (Posted On: 30 Apr, 2012)

This question relates to point of taxation when there is change in rate of duty. It has two replies depending upon the category of service provided by you:- a. If one is falling under six categories on which service tax was payable on receipt basis then the service tax is payable on receipt of amount. If the amount is received in April then the service tax @ 12.36% otherwise the service tax is payable @ 10.3%. b. However, if the person is paying service tax under normal point of taxation then the service tax is payable under two situations viz. when the service is provided before change in rate of duty and secondly, when the service is not provided before change in rate of duty. Since your query says that the service is provided then the invoice or payment received before the date of change in rate then the service tax is payable on old rate. But you are telling that the invoice is raised afterwards and there is no mention of payment in query. In such situation if the payment is received before 31.3.2012 then the service tax is payable @ 10.3% (old rate). But if the payment is also received after the date of change in rate of duty i.e. 31.3.2012 then the service tax is payable on higher rate i.e.12.36%.
Respected Sir, Can proceedings of sending show cause notice for levy of service tax, interest and penality be initiated on Legal Rep's after the death of Proprietor. Your expert advice and help shall be highly appreciated. Jasbir Singh (Posted On: 29 Apr, 2012)

There is no provision in the Central Excise law or the rules framed there under for such an action. No action can be taken against the Legal representative after the death of the Proprietor.
I manufacture gold jewellery on gold issued from jeweller(Exporter). My anual labourrecieved is 15 lac.My personel stock is 20 lac&annual sale is 9 lac.Am I liable to servicetax or exciseduty Parveen kumar bhola (Posted On: 26 Apr, 2012)

The manufacture of Gold is on jobwork basis and for this the supplier is required to obtain registration. The excise duty liability is on the supplier of goods only. As you are only doing jobwork then it will not be liable to service tax under BAS service, as the process undertaken by you amounts to manufacture. This is the reason excise duty is being charged on the same. If any process amounts to manufacture under Central Excise then there is no service tax on such process. Hence, no excise duty or service tax is payable by you.
Dear Sir, whether zinc sulphate is classified under heading 283329 (Agriculture grade zinc sulphate ordinarily used as micronutrient) or under heading 31(All goods, other than those which are clearly not to be used as fertilizers). MOHAMMAD MUSLIMBHAI SHAM (Posted On: 24 Apr, 2012)

The classification of Zinc Sulphate will be under heading 283329 if it is of agriculture grade and is ordinarily used as a micronutrient. Chapter 31 does not cover goods other than fertilizers but covers fertilizers, therefore, Zinc sulphate will not be covered under Chapter 31. The Chapter Note 1 (b) to Chapter 31 clearly provides that this chapter does not contain separately chemically defined compounds [other than those answering to the descriptions in Note 2(a), 3(a), 4(a) or 5 below]. And the compounds given in Note 2(a), 3(a), 4(a) or 5 do not include Zinc Sulphate. Further, serial number 103 of Notification number 12/2012-C.E dated 17.3.2012 also exempt Agricultural grade Zinc Sulphate ordinarily used as micronutrient from payment of duty. The tariff heading mentioned in above serial number is also 2833 29.
Sir we purchase Pig Iron from a Unit which is Export Oriented Unit on domestic sale has to pay BCD and CVD their is changes in budget regarding exemption of cess, pls clarify which cess exempted and which is still leviable and can be take credit of the cess. Pankaj Bardia (Posted On: 23 Apr, 2012)

The educaiton cess and SHE cess on CVD is exempted but the custom educaiton cess and Custom SHE cess is still applicable. But the credit was available of cess paid on CVD. Hence, it will not be available henceforth.
Dear Sir, We are exporting the Automobiles parts on payment of Excise duty and subsequently claiming the rebate of excise duty paid at the time of Export and while procuring inputs we are claiming the CENVAT credit of the excise duty paid on Inputs. There is no domestic sales, it is 100% export. Questions need to be answered— 1. In your view, is it appropriate to deposit the Excise duty and then claim the same as rebate? , 2. Should we stop the export on payment of duty and subsequent claiming of rebate, because in this scheme we are getting only our hard earned money back which we deposited as excise duty from the excise department after a considerable time, no value addition? 3. Alternatively, and most importantly, should we opt Export without payment of Excise duty under LUT and then claim (i) Refund of CNVAT credit accumulated on account of non-payment of duty on export, (ii) claim Duty Draw Back under All Industry Rate? Pls. give us your valuable opinion about above situation and guide us which scheme we should go for. Thanks and Regards, Sanjay Sharma Sanjay Sharma (Posted On: 23 Apr, 2012)

The claiming of rebate is simplest way of getting the money back from the department. Yes, the other option of refund of unutilised credit is cumbersome as department insists on corelation of raw material and finished goods. Although this budget has proposed to give the same on proportionate basis but it will be seen how field formation interpretate the same. The other alternative of taking drawback is also good but then you need to take the cenvat credit. As logic given for opting out of the option by you is that you pay the duty first on Raw material then take cenvat credit. Utilise the same in payment of duty and then take rebate. It is taking back your hard earned money. In all the options quoted by you, you pay the duty first on your RM and then get it back from the department.Hence there is no difference in earlier option and last two options. Lastly, if you do not intend to pay the duty of Raw materials first then you opt for procurement of duty at nil rate of duty under Rule 19 of Central Excise Rules.
Dear sir, we are registered dealer in central excise. We import scrap and sell it to local excise dealer. While importing scrap we are levied Basic Custom Duty (BCD), CVD, Cess and HCess on above. As a registered dealer in central excise we are passing on the CVD, Cess on CVD and HCess on CVD to our dealers. I just want to know whether BCD, Cess on BCD and HCess on BCD paid by us at the time of import can be get back as refund or drawback or by any other mode.? Thank You. MOHAMMAD MUSLIMBHAI SHAM (Posted On: 20 Apr, 2012)

There are no provisions in customs law for refund of basic customs duty, however there is provision to get duty drawback on import portion of BCD, but it is applicable only if you are exporting. Since you are not exporting, the same shall not be applicable to you.
My client was purchased duty paid item which is falling under central excise tariff heading no.69032010 It is used to melting of brass for manufacturing of excisable goods, whether can we treat as a capital goods under Rule 2 of CCR,2004 or not and take the cenvat credit 50% as per terms of rule 4 of Cenvat credit rule 2004 Rai Singh (Posted On: 20 Apr, 2012)

The goods falling under Chapter 82,84,85 and 90 falls under the definition of "capital goods". However, the refactory materials are also covered under the definition. Hence, if the goods falling under 69032010 is silicon carbide crucibles are refractory material then the credit on the same will be available.
Dear Sir, We are exporting the Automobiles parts on payment of Excise duty and subsequently claiming the rebate of excise duty paid at the time of Export and while procuring inputs we are claiming the CENVAT credit of the excise duty paid on Inputs. Questions need to be answered— 1.In your view, is it appropriate to deposit the Excise duty and then claim the same as rebate? , 2.Should we stop the export on payment of duty and subsequent claiming of rebate, because in this scheme we are getting only our hard earned money back which we deposited as excise duty from the excise department after a considerable time, no value addition? 3.Alternatively, and most importantly, should we opt Export without payment of Excise duty under LUT and then claim (i) Refund of CNVAT credit accumulated on account of non-payment of duty on export, (ii) claim Duty Draw Back under All Industry Rate? Pls. give us your valuable opinion about above situation and guide us which scheme we should go for. Thanks and Regards, Sanjay Sharma. Sanjay Sharma (Posted On: 20 Apr, 2012)

There are many options which you can explore, however which is most beneficial depends upon your entity only. Moreover you can also go for refund of accumulated CENVAT credit under Rule 5 of CCR'04 , since the scheme has been changed in the current budget and refund is allowed on the basis of export turnover.
when I fill er-1 month of march-12, add new column of Tariff Notification availed (what does fill in it) Arun Sharma (Posted On: 16 Apr, 2012)

In this column you have to add the Notification prescribing the present rate of duty for your product
One promoter acquired land in his name and divided it in 100 plots and sold them to individual buyers. The buyers register their respective plots in their name. Now each buyer gives a contract individually to contractor (who was the previous land owner) to construct a single residential unit for his personal use. Therefore 100 individual residential units are constructed for 100 individual customers. I wanted to know whether service tax will be applicable on it or not? Can the individual buyers claim that this residential unit is for personal use and exempt from service tax? Gokul Chand Baid (Posted On: 16 Apr, 2012)

If the individual buyers themselves had undertaken the construction, then only they could have claimed that the residential flat was for their personal use. However, the buyers have hired a contractor to build their house. Therefore, exemption from service tax cannot be claimed. Moreover in a recent judgement in case of Isha Homes (I) Private limited {2012 – TIOL – 424 – CESTAT – MAD} tribunal in the similar case has ordered pre – deposit of the amount of service tax.
Sir, can u tell me any notification to charge excise duty for neepal export. kindly send me a copy in my mail id. i shall always thanks for you sir. JITENDRA KUMAR TIWARI (Posted On: 13 Apr, 2012)

The notification for export to Nepal has been changed from March 1, 2012. The rebate of duty paid on the export to Nepal will be done under normal export procedure contained in Notification number 19/2004-C.E.(N.T.) dated 6.9.2004 as amended by Notification number 24/2011-C.E. (N.T. ) dated 5.12.2011 effective from 1.3.2012.
dear sir i am engaged in manufacturing of gold ornaments on job work whether i am liable to pay service tax P.RAJESH JAIN (Posted On: 10 Apr, 2012)

Since the manufacture of unbranded jewellery has been brought under excise net from the current budget, you shall not be required to pay service tax on the same, as the person who gets the goods manufactured on job work basis has been made liable for payment of duty. Hence the principal manufacturer will be liable for payment of the excise duty on the same.
Dear Sir, We are manufacturer of excisable as we as exempted goods, we are taking cenvat on the inputs and paying the 5% (now 6%)amount on the finish goods clearance. I want to know whether we have to pay the 5% amount on goods cleared for export as the the notification No.24/2010-CE (NT) dt 26.5.10 specifically exclude the exempted goods from exporting under Bond. Pravin Deokar (Posted On: 10 Apr, 2012)

As per point no. (v) of Rule 6(6) of Cenvat Credit Rules’04 the provision of Rule – 6(1), 6(2), 6(3), 6(4) shall not be applicable in case excisable goods are removed without payment of duty for export under bond in terms of provisions of Central excise rules,2002. Thus, you shall not be required to reverse credit on the same. But if you manufacture totally exempted goods then you will not be allowed to take the credit. However, if you are manufacturing excisable and exempted goods then you are allowed to take the credit on common input and input services.
since service has been rendered before 31.03.12 and bill has also been raised before 31.3.12, only the payment has been received after 1.4. 12, the effective rate of tax will be 10.30%? kavita thanvi (Posted On: 09 Apr, 2012)

The Chartered Accountants are paying service tax on receipt basis as per Rule 7 of Point of Taxation Rules. As per the recent amendments in budget 2012, the amendment has been made vide Notification No. 04/2012-ST, dated 17/03/2012 in Rule 2 of Point of Taxation Rules, in which the following rule has been inserted:- ‘2A. Date of payment.—For the purposes of these rules, “date of payment” shall be the earlier of the dates on which the payment is entered in the books of accounts or is credited to the bank account of the person liable to pay tax: Provided that — (A) the date of payment shall be the date of credit in the bank account when — (i) there is a change in effective rate of tax or when a service is taxed for the first time during the period between such entry in books of accounts and its credit in the bank account; and (ii) the credit in the bank account is after four working days from the date when there is change in effective rate of tax or a service is taxed for the first time; and (iii) the payment is made by way of an instrument which is credited to a bank account, (B) if any rule requires determination of the time or date of payment received, the expression “date of payment” shall be construed to mean such date on which the payment is received;‟. Hence, in case of change in rate of duty, date of payment will be point of taxation and consequently, in case referred by you the service tax is payable on rate applicable on the date of payment. It will be after April 1, 2012. Further it is also clarified by Circular No. 154/5/2012-ST, dated 28/03/2012. It clarifies that the Notification No. 04/2012-ST, dated 17/03/2012 has amended Point of Taxation Rules as well as Rule 7 which applied to the individuals or proprietary firms or partnership firms providing specified eight services taxable services of section 65 of the Finance Act, 1994 which also includes the services provided by practicing chartered accountants. Rule 7 determined the point of taxation in such cases as the date of receipt of payment. The issue has been examined for invoices issued on or before 31st March 2012, the point of taxation shall continue to be governed by the Rule 7 as it stands till the said date. Thus in respect of invoices issued on or before 31st March 2012 the point of taxation shall be the date of payment. Following the same, the service tax will be payable @ 12% as the payment is after April 1, 2012. We hope that the above will satisfy your query.
Sir, we are 100% eou. we filed refund claim for the quarter of july 10 to Sept. 10 on 30.09.2011 for unutilised credit under rule 5. But department rejected our claim on time bar. Pls. guide. UNMESH V. KASHIKAR (Posted On: 07 Apr, 2012)

The time limit under Section 11B of the Central Excise Act, 1944, does not apply to refund of accumulated credit. This has been held by the CESTAT in many cases. The Board has also clarified in Circular No. 120/01/2010- ST, DT. 19/01/2010 that even for opening balance in Credit Register, refund can be filed. It was said that “As regards the quarterly filing of refund claims and its applicability, since no bar is provided in the notification, there should not be any objection in allowing refund of credit of the past period in subsequent quarters. It is possible that during certain quarters, there may not be any exports and therefore the exporter does not file any claim. However, he receives inputs/input services during this period. To illustrate, an exporter may avail of Rs.1 crore as input credit in the April – June quarter. However, no exports may be made in this quarter, so no refund is claimed. The input credit is thus carried over to the July-September quarter, when exports of Rs.50 lakh and domestic clearances of Rs.25 lakh are made. The exporter should be permitted a refund of Rs.66 lakh (as his export turnover is 66% of the total turnover in the quarter) from the Cenvat credit of Rs.1 crore availed in April-June quarter.”
I could not submit some of the input credit invoices before adjudicating authority as a result i was asked to pay service tax with interest and penalty, whether I can make appeal to commissioner appeal showing all the input credit documents which i have misplaced. k.venkata rao (Posted On: 05 Apr, 2012)

Yes. Appeal can be filed before the Commissioner (Appeal) submitting the additional documents and the reasons for non-submission before the Adjudicating Authority. You can submit for setting aside/modifying or annulling the Order-in-Original. The Commissioner (Appeal) can quash the order or modify the order but cannot remand the matter back to the Adjudicating Authority as he is not empowered to remand the case.
We are paying service tax on receipt basis, being ca, and servixe provided before 31.03.2012, bill raised before 31.03.2012, payment received after 31.03.2012. Pl inform what rate will be charged ca akhilesh narayna (Posted On: 04 Apr, 2012)

As per recent amendment in POT as well as CBEC clarification, you have to pay the service tax @ 12.36%. It is clarified that if the payment is received after March 31 ( not within four working days) then service tax at higher rate is to be paid.
Respected Shri Jain, Sir, We are an EOU and sell part of goods to DTA. Could you please guide us on Excise Duty Calculations for DTA sales by an EOU (especially after Budget 2012-13) or any Notification No. where the method of calculation can be referred to . Thanking you in advance. Vipul Adhvaryu (Posted On: 04 Apr, 2012)

There is no clarification on this issue by CBEC also. When the education cess and SHE cess is not charged on CVD at the time of import then it should not be charged by EOU. Let us wait for the clarification.
Respected Sir, As you know the excise rate has been changed from 10% to 12%,till feb-2012 I was typing in the payable sheet of finished goods in the tariff notification availed column in the ER-1 02/2008,then when I will show the 12% duty of the sale on the seprate sheet then I have to write 02/2008 or any other notification. mehul (Posted On: 01 Apr, 2012)

You have to show two separate enteries for each product. One showing duty @ 10% from 1.3.2012 to 16.3.2012 and other showing duty @ 12% from 17.3.2012 to 31.3.2012.
what is the maharashtra state excise duty structure for sugar which has to be calculated in CT-1 balasaheb (Posted On: 30 Mar, 2012)

We are dealing in Central Excsie, Service tax, DGFT and Customs. But we are not dealing in State Excise Duty. Hence, we cannot reply your query.
We are Selling of space or time slots for advertisements in internet. As per negative list are we exempted from service tax. Regards, Balaj.P Balaji.P (Posted On: 28 Mar, 2012)

Yes, you are covered in Negative list of Service tax. Sale of space for advertisement in internet is non-taxable and no service tax will be payable.
Respected Sir, One of my clients is about to cross the turnover of Rs.4 crore,then does he becomes permanently excisable to issue excisable invoices compulsorily or if his turnover remains below rs.4 crore then can he take the benefit of Rs. 1.5crore till which no duty is charged. mehul (Posted On: 28 Mar, 2012)

If your client has crossed the limit of 4 crore then he will be liable to pay duty in the next financial year and he will not be entitled to benefit of 1.5 crore in that year.
Respected Jain Sir, we would like to draw your honours kind attention on the fact that one of the our client is service providing a business axuliary services and problem is that assessee has providing services after the 17.03.2012 and completion of providing a service is 20.03.2012. The invoice has been used on after 31.03.2012 & Payment received after 31.03.2012 and on 01.04.2011 service tax rate has been changed to 10.3% to 12.36 %. Sir , I would like to ask ? 1. wether assessee has charges service tax on 12.36 % or 10.3 %. 2. assessees services liable to tax on old rate or new rate,please give details as per the service tax point of taxation rules in brief ? 3. If above mentioned Question , payament of services received before the 31.03.2012 and bill invoice is issued on after 01.04.2012 ? Dinesh Maru (Posted On: 28 Mar, 2012)

As per point of taxation rules, service tax shall be payable by earlier of the following dates- 1. Provision of service 2. Payment received 3. Invoice issued Therefore, whether service tax received before 31.03.2012 and invoice issued before 31.03.2012, service tax shall be chargeable @ 10.3%. But if the payment is received after 31.03.2012 then the rate of service tax shall be 12.36%.
vat rate of haryana debender parhi (Posted On: 27 Mar, 2012)

We are dealing in Service tax, Excise, DGFT and Custom. We donot deal in VAT. Hence, we cannot reply your query.
Respected sir, Can I take 100% credit of addl.duty of the machinery imported this year or I have to take 50% credit compulsorily. mehul m ashar (Posted On: 27 Mar, 2012)

A unit eligible for SSI exemption can take 100% credit on capital goods otherwise 50% credit is available.
Respected Sir, IF 50% credit of addl.duty on imported parts on machinery is been taken in february-2012 & remaining I want to take in March-2012. mehul m ashar (Posted On: 27 Mar, 2012)
Kindly clarify that service rendered till 31.03.2012 and bill raised on 01.04.2012 then what will be service tax rate. sukhvinder kaur (Posted On: 26 Mar, 2012)

If the bill is raised on 01.04.2012 for service rendered till 31.03.2012, the service tax will be charged @ 12% i.e. the assessee will have to pay extra 2% tax. This is as per the newly enacted Rule 2A in Point of Taxation Rules, 2011 in case of new levy or rate change, the date of payment will be either the date of entering payment in the books of Accounts or date of credit in bank account of person liable to pay service tax.
What is the rate of service tax under composition scheme from 01.04.2012? sukhvinder kaur (Posted On: 26 Mar, 2012)

The rate of service tax under Composition scheme from 01.04.2012 will be 4.8%. Earlier it was 4%.
Dear Sir, Kindly advise whether a non excisable unit needs excise registration for Factory Stuffing permissions for exports. Pawan Kothari (Posted On: 26 Mar, 2012)

A non excisable unit cannot take registration in Central excise except when the exporting units intends to bring the inputs at nil rate of duty to be used for exports. The stuffing of non excisable goods is normally done by service recipient.
Respected Sir, How to sale the goods if it is received as sales return from a government Enterprise in excise. mehul (Posted On: 26 Mar, 2012)

It has to be sold under central Excise invoice. Rule 16 of Central Excise Rule will apply. It should come back with duty paying document. The unit can take credit on returned goods on basis of such duty paying document. If the same is returned after repairing then credit is to be reversed and if the same is returned after manufacturing process then duty is to be paid.
Respected Sir, Is there any surety of GST Implementation from 01-08-12 as declared by FM in the budget 2012-13. mehul (Posted On: 26 Mar, 2012)

he has not said about implementation of GST but for computer software for the GST.
We are dealing in unbranded jewellery and issuing tax invoice, sales invoice and cash memo as per up vat act. What procedure we have to follow for excise purpose ca akhilesh narayna (Posted On: 25 Mar, 2012)

only one invoice can be used for clearance from a factory under Rule 11 of Central Excise Rules. If you require more than one invoice then permission from Deputy Commissioner/ Assistant Commissioner of Central Excise is to be taken.
Respected jain sir, We would like to draw your kind attention on the fact that one of the our client would want to CT Certificate from Assistant Commissioner of Central excise. Sir, we consulting them and getting CT - 1 certificate from the department of certral excise ( Assistant commissioner ) but we asking you after that certificate granted by assistant Commissioner which proof we have to submitted please give information? 1). After getting CT-1 Certificate which export proof assessee has to submitted ? 2). How many time limit to submission of proof of export to assistant commissioner ? 3) Give list of document in details which can be submitted to the assistant commissioner ? 1). Dinesh Maru (Posted On: 24 Mar, 2012)

CT-1 certificate is used for export through merchant exporter. The merchant exporter has to obtain the CT-1 certificat. You have to execute a bond with AC/DC and then CT-1 certificate will be issued by Range superintendent. The liability to submit proof of export will be on you and not on manufacturer. The time limit of submission of proof of export is six months. You have to submit original and duplicate copy of ARE-1, Self attested copy of EP copy of shipping bill and Bill of lading.
Respected sir, i want know that is new service tax rate applicable on service provided in Feb -12 and invoice raised on april -12. Please answer me mita (Posted On: 24 Mar, 2012)

It depends on service provided by you. As per POT, if the tax is payable on the basis of invoice raised, service provided or payment received, whichever is earlier then the assessee pay the tax in March itself. But if the POT says that the tax is to be paid on receipt basis (as in case of lawyers) then the service tax is to be paid @ 12% as the payment is received in April 2012.
Respected Sir, how to sale goods which are received as sales return from a non-excisable manufacturer mehul (Posted On: 20 Mar, 2012)

The seller can sale the sales-returned goods as a normal sale because the buyer is non-excisable manufacturer (Either buyer is dealer or manufacturer of exempted goods). The point which is to be kept in mind is that whether we (seller) are excisable manufacturer or not. If yes, then first see that the buyer is charging excise duty (amount of duty as mentioned by the seller) or not. If the buyer is charging then seller will entitled to take credit (at the time of removal) and then reversed the same (at the time of return).
Respected Sir, AS rate of excise duty has been changed,and If a ct-3 in which 10.3% duty is there and a part qty has been sold of that ct-3 before 16-03-2012,now as the rate has been changed now what is the procedure we have to do to cancell that ct-3 or we have to send back to the eou customers of ours. mehul m ashar (Posted On: 18 Mar, 2012)

In this case, the supplier has to cancel that ct-3 for the remaining quantity (i.e.40) because amount of duty will be short in case of non-cancellation of ct-3. The supplier of the goods has to apply to Range for the issuance of “Non-utilisation certificate”.
Sir, We are doing Job Work of Processing slitting & pickling of duty paid (excise) Coiles. All the material comes under 54 FC Challans. Our Services comes under business auxillary Service. We were covered under notificatin no. 8/2005 of Service Tax up the year ending 31.03.2012. Is there any amendment to this notification in the budget 2012-13. S D DOKE (Posted On: 17 Mar, 2012)

No, there is no change in the Notification no. 08/2005-ST.
Respected Sir, Is there any change in the turnover limit of Excise according to the budget 2012-13,or it is 1.5 crore as it is. mehul m ashar (Posted On: 17 Mar, 2012)

No, there is no change in the turnover limit of excise according to the budget 2012-13 and the limit of Rs.1.5 crore is retained.
Respected Sir, is there any change regarding interest on late payment of Excise duty according to the budget 2012-13. mehul m ashar (Posted On: 17 Mar, 2012)

No. There is no change regarding rate of interest on late payment of Excise duty as per the Finance Budget for the year 2012-13. The existing rate of interest on late payment of excise duty is 18% p.a.
Can I have Central Excise Notification of change of rate from 10 to 12% Jagdish Hoti (Posted On: 17 Mar, 2012)

In the Finance Budget for the year 2012-2013 the prime amendment in the field of Excise is the increase in the rate of Excise duty. The rate of Excise duty has been increased from 10% to 12% except on few items vide Notification no. 18/2012-CE dated 17/03/2012. You can download the above mentioned notification from our website- capradeepjain.com from Central Excise Section in Tariff Notification Section.
Can their be any saving on freight charges if a manufacturer opts for Work Contract Tax? swasti purohit (Posted On: 15 Mar, 2012)

If the vehicle is owned by the manufacturer then there may be saving on freight charges.
Respected Sir, How to take credit on the goods received as sales return from a government enterprise. mehul (Posted On: 15 Mar, 2012)

The credit on sales return will be available if the goods are brought to the factory of seller for being re-made, refined, re-conditioned or for any other reason and if the process undertaken by the seller amounts to manufacturing process as per Rule 16 of the Central Excise Rules, 2002. In case of sales return by a Government Enterprise, either Govt. enterprise should send Original invoice of the seller or issue a Debit note to the seller then only the seller can take credit proportionately.
Respected Sir, if an excisable unit has one or more registered unit on the same name then it will be considered as a LTU.? or it would on the basis of taxes paid. mehul (Posted On: 12 Mar, 2012)

Eligibility of LTU is on the basis of taxes paid in cash or from account current and not on the basis of excisable units. For a unit to become a Large Taxpaying Unit, it is required that the said Unit should have paid the excise duty/service tax of more than Five Crore Rupees in the financial year 2004-05 or during the year preceding the year of application. Income Tax assessees paying advance tax of more than Rs. 10 crores can also be eligible for LTU status.
when a excisable unit shut then what process required also excise duty pending & what about excise audit & AG audit ? rakesh kalantri (Posted On: 10 Mar, 2012)

In case a unit is being shut down than it has to surrender its excise registration. Notification No. 35/2001-CE(NT) prescribes that the registered assessee who ceases to carry on the operation for which he is registered, shall de-register himself by making a declaration in the form specified in Annexure-III and deposit his registration certificate with the Superintendent of Central Excise. If any amount of duty is pending it should be payable within the statutory time limit. The procedure regarding audit is the same as normal audit procedure. No special procedure is prescribed.
Respected sir, how to sale a capital good on which credit is not taken though it was a excisable invoice,is it necessary to take credit on it to sale or we have to make an exempted excisable invoice. mehul (Posted On: 03 Mar, 2012)

It has to be sold under an invoice issued under Rule 11 of CER, 2002. Since you have not taken the credit, as such there is no need to reverse the credit. Mention the fact that "No cenvat credit is taken on such capital goods" on the face of invoice. There is no need to take credit but the clearance of capital goods has to take place under a Central Excise invoice but without any payment of duty.
whether a DTA unit can claim refund of unutilized CENVAT credit under rule 5 of CCRs, 2004 as the rule covers export and not deemed export narendra (Posted On: 25 Feb, 2012)

When a unit exports under bond then it is eligible to claim refund of unutilised credit under Rule 5 of Cenvat Credit Rules, 2004 read with notification 5/2006. It does not apply only EOU. Even a DTA unit exporting goods can claim refund. Even as per tribunal decisions, the unit sending goods to 100% EOU can claim refund of unutilised cenvat credit.
Sir, is service tax applicable on work contract of making Aluminium / Glass window, Door. if yes When the liability of service registration number arise and what is the percentage of Service tax.is abatment recived on gross value. PINTU SHAH (Posted On: 22 Feb, 2012)

Yes, Making of Aluminium/Glass window door is leviable to service tax under work contract service, If such making of aluminium/glass window door is related Work project like Residential, commercial, industrial, institutional etc. The liability of service tax registration will arises when value of taxable services provided or to be provided is equal to 10 Lakhs or more then 10 lakhs. The rate of service tax on “work contract service” is 10.3% (inclusive of Education Cess and Sec. Higher Education Cess) on value of service. However assessee has an option to pay service tax under composition scheme @ 4.12% (inclusive of Education Cess and Sec. Higher Education Cess) on gross amount charged for the work contract but the service provider cannot avail Cenvat credit of Inputs, when he opts the composition scheme. The restriction under composition scheme is only on Cenvat credit of input and he can avail Cenvat credit on input service and capital goods.
SSI Exemption Limit is allowed till 1.5 Crores provided turnover in previous year was within 4.0 Crores. Say a new unit starts product on September 1, will they be eligible for exemption upto 1.5 crores for the remaining part of the year or the amount will be proportionate to the months. If the former is true are than any precedents/circulars or case laws? Bharath Kedia (Posted On: 14 Feb, 2012)

Yes, new unit is eligible to take whole credit of 1.5 crores for the remaining part of the year povided his product should be covered SSI exemption notification number 8/2003-CE dated 1.3.2033 and as amended. According to this Notification, SSI exemption limit is allowed upto 1.5 crores when aggregate value of clearances (exempted as well as dutiable products) in previous financial year was within the limit of 4.0 crores. There is no provision of proportionate exemption. Hence, in this case when the unit starts production from September, the last year aggregate value will be zero. Therefore, the unit is eligible for SSI exemption upto Rs. 1.5 crores for the remaining part of the year.
Sir, What is the Basic Duty and CVD payable on (a) Iron Ore Pellets, and (b) Sponge Iron currently in India E S Ullas (Posted On: 14 Feb, 2012)

The rate of Basic Excise Duty or CVD on “Iron Ore Pellets” (26011210) is 10%. And the rate of Basic Custom duty on “Iron Ore Pellets” is 2.5% (as amended from Notification 21/2002-Cus. dated 1.3.2002). The rate of Basic Excise Duty or CVD on “Sponge Iron cast fitting” (73071110) is 10%. And the rate of Basic Custom duty on “Sponge Iron cast fitting” is 10%.
We buy raw material from domestic manufacturer and claim Cenvat and after processing exporting the final product without payment of duty. Is there any additional export benefit in Customs/Excise other that claiming cenvat on RM. S. Nagesh Hegde (Posted On: 13 Feb, 2012)

yes, there are number of export benefits available like drawback, advance authorisation/ DFIA, FMS, FPS, VKGUY, Market linked FPS etc. are available. Since you are availing Cenvat credit on inputs then you can claim drawback with Cenvat credit. You can go through foreign trade policy to view the other benefits.
Sir, we as a dealer sold 100 Qty to manufacturer with cenvat pass, now manufacturer wants to return 60 qty back to us through issuance of excise invoice by reversing the cenvat amount availed on 60 Qty. Can we take it as fresh entry in RG23D and pass on the same to other manfuacturer/dealer. S. Nagesh Hegde (Posted On: 04 Feb, 2012)

Yes, you as a dealer can do so. The only requirement for the dealer is that the goods should be received under a duty paying document. Since the dealer is receiving the same, he can enter the same in RG 23D register.
Respected Sir. We have purchase Raw Material from HALDIA Petrofils. We have got the RM with Excise Duty, also they have charged Freight Charges + Service Tax. Can we take Credit of the same Invoice. (Posted On: 01 Feb, 2012)

Yes, we can also take the credit of service tax charged on Freight in Excise invoice. Any invoice issued under Rule 11 of Central Excise Rules is a valid duty paying document for taking Cenvat credit under Rule 9 of Cenvat Credit Rules, 2004.
I have paid the 4% addl. duty and CVD on imports by partly through debiting of DEPB licence and partly by Cash. Can I avail CENVAT credit on the said Addl. Duty and CVD which is paid through DEPB. If yes, what document to be provided, since Bill of Entry does not reveal the details of duties paid through DEPB. Only the total amount debited in DEPB license is mentioned in Bill of Entry. Please advice. (Posted On: 01 Feb, 2012)

Yes, manufacturer can take credit of 4% SAD and CVD paid through DEPB as per condition number (vi) specified in notification number 97/2009-Cus. Dated 11.9.2009 and as amended. Further, the valid duty paying document is Bill Of Entry as per Rule 9 of Cenvat Credit Rules. The Bill of Entry clearly mentions BCD amount as well as CVD amount when the duty is passed through DEPB. The credit of BCD amount includes Basic custom duty plus custom education cess and custom SHE cess and the credit of the same is not available. The CVD amount includes CVD plus education cess on CVD plus SHE cess on CVD and 4% SAD. The credit is available on this amount. However, one has to calculate the complete duty amount at his own and tally the same with duty paid through DEPB. Then he can take the credit.
Respected Sir, how to sale machinery in excise if it is purchased from a non-excisable trader,it will be an exempted sale or it would be a duty paid sale. mehul m ashar (Posted On: 28 Jan, 2012)

As per Rule, we have to reverse the cenvat credit on removal of capital goods. As we have purcahsed from non-registered dealer then we have not taken the credit on the same. Since the credit is not taken then there is no need to reverse the same. It will not be termed as exempted sale or duty paid sale. We have to reverse the credit taken at the time of purchase.
i want to know what r the service tax provisions related to works contract service what r the requirment for filling return for such work contract service and the time period in which is should be filled virendra modi (Posted On: 27 Jan, 2012)

The provisions relating to works contract are very vast and it is difficlut to answer the same in this query section. If we are registered in works contract under Sales tax then we can opt for work contract under service tax.If we are not able to maintain the material and labour separately then we can opt for composition scheme under service tax. The rate of tax under composition scheme is 4%. For every contract, the assessee has to opt for composition scheme.
i have purchased mahciney for rs.200000.00 and taken credit Rs.10000.00(50%)and i want to sell mahcinery after 2 months then we have to calculate duty on 50% taken or on 100% duty?and can we take remaining 50% credit on the sold machiney. mehul.m.ashar (Posted On: 22 Jan, 2012)

While removing the machine from the factory, you should take the remaining 50% Credit. This means that the whole credit of duty is to be taken in the same financial year. Then if the machine is not put to use then you have to reverse the complete cenvat credit. But in case it is put to use then you should deduct depreciation @ 2.5% per quarter as per Rule 3 (5) of Cenvat Credit Rules, 2005 and then reverse the cenvat credit.
In case of goods exported, If we have availed rebate of excise duty paid on inputs under rule 18, can we avail 1% duty drawback as per customs circular no 35/2010 dtd 17/9/10? abhishek bhargava (Posted On: 20 Jan, 2012)

There are two types of rates in the drawback schedule. One is "with cenvat credit" which is custom portion only. The other is 'without cenvat credit" which with excise and custom duty. It implies that if we have availed the cenvat credit of excise duty then custom portion is allowed and in another case, sicne credit is not availed then benefit of excise and custom will be allowed. Sicne you have availed the benefit of excise duty under Rule 18 then only custom portion will be allowed. Since you have not mentioned the product name as well as whether this "with cenvat" rate or "without cenvat" rate, hence we cannot comment. You have to judge as per guildelines given above.
We have paid service tax on bills towards our parent company outside india. Now when we came to know that it is covered under Export of service, we are claiming refund of service tax paid. But deptt is saying since we have recovered Service tax from our parent company, they will transfer the refund to Consumer Welfare Fund. Please help.... Jugmohan (Posted On: 20 Jan, 2012)

A person cannot be enriched unjustly. If you have recovered service tax paid by you from your parent company then you cannot claim refund of service tax as you will be enriched unjustly. It is required to be proved that service tax has not been recovered from the parent company if it is not recovered from them by leading cogent evidence. But if the service tax amount is recovered then the refund of the same will not be given to you but will be transferred to Consumer Welfare Fund.
Dear sir, I have request the my new password as earlier as possible the above email address, AMIT my passward mismatch (Posted On: 18 Jan, 2012)

in case you have forgot the password then at the time of login, you should click on "Forgot password". You will get the username and password on your e-mail address by the software.
Can duty paid goods (specifically liquor) be allowed to stock at duty free shops at airports? Pls provide the reference of related statute/circular/ notification Kewal Satra (Posted On: 13 Jan, 2012)

since the liquor is covered under State excise duty and we are not dealing in this subject, we are not able to reply the same. Please contact the expert in this field.
Builder issue following details to buyer at the time of booking of residential unit and as per agreement: Description Amount (Rs.) Basic sale price 23, 08,887 PLC charges/ ( Development charges) 26,674 Security services 58,000 Club membership facility 43250 Maintenace charges 25250 Total Payable 24,62,061 Is he is liable to pay service tax in following catagory: Construction of Residential complex Preferential location and development charges Security service Club service Repair or maintenance service. Is it correct and builder has to take registration in all above category. Pls clarify Thanks deepak gupta (Posted On: 12 Jan, 2012)

As per the clause (ii) of definition given of residential complex in sec 65(91a) residential complex means any complex comprising of (ii) a common area. Common area as per circular no. B1/6/2005-TRU, dated 27-7-2005 would include roads, staircases and other similar areas where residents of the residential complex have easement rights. The list of facilities prescribed is merely illustrative and not exhaustive. Some residential complexes may also contain other facilities such as market or shopping complex, schools, security, banks, gymnasium, health club, sports facilities, and power back up and the like. Thus all the services provided by builder will be chargeable pertaining to Club, security, repair or maintenance will be chargeable under the head “Construction of residential complex service only”. However, for preferential location and development charges, there is a separate head itself called “Preferential location or development of complex service sec (65(105)(zzzzu) under which same shall be chargeable and separate registration for the same shall also have to be taken by builder.
Builder company: As per agreement builder issued a Letter dated 18 october 2011 to buyer mentioning: On start of first floor roof payment of Rs. 139200 should paid upto: 31 october-2011 & even no work is started on that date. Actual payment received on 08 December-2011 Which date is to be considered for service tax as per point of taxation rules 2011. Pls clarify Thanks deepak gupta (Posted On: 12 Jan, 2012)

Commercial or industrial construction service and construction of residential complex service has been notified as Continuous supply of service. As per Point of Taxation rules, in case of continuous supply of service, the point of taxation shall be (a)The time when the invoice for the service provided or to be provided is issued; Provided that where the invoice is not issued within fourteen days of the completion of the provision of the service, the point of taxation shall be date of such completion. (b)In a case, where the person providing the service, receives a payment before the time specified in clause (a), the time, when he receives such payment, to the extent of such payment. Explanation 1. – For the purpose of this rule, where the provision of the whole or part of the service is determined periodically on the completion of an event in terms of a contract, which requires the service receiver to make any payment to service provider, the date of completion of each such event as specified in the contract shall be deemed to be the date of completion of provision of service. Explanation 2. - For the purpose of this rule, wherever any advance, by whatever name known, is received by the service provider towards the provision of taxable service, the point of taxation shall be the date of receipt of each such advance. As per your query, the agreement provides that a letter is issued to the buyer mentioning that “On start of first floor roof payment of Rs. 139200 should be paid up to 31 October-2011 & even no work was started on that date.” Thus, as per given information buyer should pay for first floor roof till 31 October, 2011. So event in this case is date as per contract on which payment is to be made i.e. 31 October, 2011. In case of continuous provision of service is date of completion of service is end of event (i.e. date on which payment as per contract is to be made). As per Point of Taxation Rules, 2011, Point of taxation shall be earlier of date of issuing of invoice or date of making advance payment, whichever is earlier. But if invoice id not issued till 14 days of completion of service, then point of taxation shall be date of completion of service or date of advance payment, whichever is earlier. In the given case, service is deemed to be completed on 31st October, 2011. If the builder issues invoice within 14 days of such completion (i.e. till 14November, 2011), then point of taxation shall be date of issue of such invoice or 8 December, 2011(date of making advance payment) whichever is earlier i.e. date of issue of invoice. But if the builder fails to issue invoice till 14th November, 2011 then point of taxation shall be earlier of 31st October (provision of service) or 8th December (date of advance payment); which will be 31st October 2011.
commercial construction& residental comlex construction service tax paid in which value actual amount received or stamp duty valuation which ever is greater/lessor CA HEMANT T DEWANI (Posted On: 29 Dec, 2011)

Under commercial construction & residential complex construction, service tax is payable on the amount received, billed or service provided whichever is earlier. Hence, it does not say anything about the stamp duty valuation.
In case of renting of immovable property having joint ownership by 05 persons, whether basic exemption of Rs.10 lakhs is availeble to all 05 persons or to ONLY ONE person ? Rent agreemnet is entered by all 5 persons and accrodingly separate cheques are also received by all 5 persons and further all the 5 person have shown rent income in their individual income tax return also and claimed TDS on rent also MEHUL SHAH (Posted On: 17 Dec, 2011)

In case of renting of immovable property having joint ownership by 05 persons, whether basic exemption of Rs.10 lakhs is availeble to all 05 persons or to ONLY ONE person? Rent agreemnet is entered by all 5 persons and accrodingly separate cheques are also received by all 5 persons and further all the 5 person have shown rent income in their individual income tax return also and claimed TDS on rent also.
While filing ST-3 for GTA, we are require to give detail of amount exempt under N/N 34/2004 or not. If detail require , in what way? saurabh (Posted On: 15 Dec, 2011)

Yes, the details of exempt amount is required to be shown in ST-3 return. In column F(I)(a) “Service Received” we have to mention total amount of Freight Amount paid and in column F(I)(c)(ii) “Amount paid towards exempted service (other than export of service)” we have to mention amount of Freight relating to Notification No. 34/2004 and 13/2008. The difference of above columns will be the taxable amount.
We are registered as trader but we want to sell goods through hi-sea sales from a different state, how to prepare invoice in such situation Narayan Singh Rathore (Posted On: 08 Dec, 2011)

For issuing an invoice, it is first required that the person issuing an invoice should have taken registration. This means that the premises from which the goods are to be sold should be registered premises. In your case, it is required that you should have registered premises i.e. depot or godown and only then an invoice can be issued. The clearance procedure to be followed in high seas sales is the same as that of general purpose clearance. The Bill of entry should be in the name of one party only and the name of the high sea buyer will be noted only on production of high sea sale contract which should be legally enforceable. Original bill of entry should also be given. All declarations, undertaking, bonds etc. are to be given by the high sea buyer. And the Original importer is also required to fulfill conditions relating to importation.
procedure for registration under excise. documents required . information required. sandeep shetkar (Posted On: 08 Dec, 2011)

You have to file online application for the Central Excise Registration. After online filing, take a printout of the same form and acknowledgement generated after filing that application. We normally give this check list to our client for Central Excise registration:- 1. MEMORANDUM & ARTICALS OF ASSOCIATION – IN CASE OF COMPANY/ PARTNERSHIP DEED- PARTNERSHIP FIRM; 2. COPY OF LEASE DEED AGREEMENT/PATTA/ RENT DEED AGREEMENT; 3. COPY OF PAN CARD OF FIRM & ITS PARTNERS; 4. COPY OF SITE MAP PLAN; 5. COPY OF GROUND MAP PLAN; 6. COPY OF SSI REGISTRATION, IF ANY; 7. COPY OF RST/CST/TIN REGISTRATION NO; 8. COPY OF IEC CODE; 9. NUMBER OF BANK A/C & TWO MAJOR BANK DETAIL- NAME OF BANK, BRANCH, A/C NUMBER & TYPE OF A/C –SAVING/ CURRENT A/C; 10. NAME ADDRESS, PHONE, FAX NO. E-MAIL ADDRESS, PAN AND OF FIRM/COMPANY; 11. NAME, RESIDENTILA ADDRESS, PHONE NO, FAX NO., E-MAIL ADDRESS, PAN CARD OF DIRECTOR/PARTNES & AUTHORISED SIGNATORY, IF ANY; 12. INVESTMENT IN LAND, PLANT MACHINERY
what is the procedure to take credit on machinery imported if the installation is in the unit-1 and want to take cenvat credit in unit-2 mehul.m.ashar (Posted On: 28 Nov, 2011)

The credit is available in the unit in which it is installed.
Dear Sir, Please let me know that can I take cenvat credit of Ed. Cess and Higher Edu cess on total duty(final duty) for the purchase from 100% EOU PAWAN GINODIA (Posted On: 25 Nov, 2011)

As per new Rule, the Education cess and SHE cess paid on CVD and SAD is available as credit. Hence it is final payment of education cess and SHE cess. Therefore, you can take credit of education cess and SHE cess.
Dear sir, can I have details of VAT levied on hotels under the VAT Acts across the country? sankar (Posted On: 24 Nov, 2011)

We are dealing in Central Excise, DGFT, custom and service tax. But we are not dealing in service tax matters. Hence, your queries cannot be answered by us.
Dear Sir, I have a query related to construction services. AS 7 construction contracts state that the revenue should be recognized on % completion method. whereas now as per point of taxation rules ST should be paid on due basis. now the problem is what shall be entry in accounts as per AS. Because if we due drs following ST rule we are ignoring AS 7 and if we follow AS 7 we are ignoring ST due basis. Waiting for an early reply. Siddharth Rutiya (Posted On: 19 Nov, 2011)

Rule 3 of the Point of Taxation Rules provide that service tax will be payable from the date of issue of invoice or from payment made, whichever is earlier. If the invoice is issued within the prescribed period of 14 days then from the date of completion of the provision of service, service tax will beome payable. And it will bw the date of completion of provision of service or payment, if the invoice is not issued within the prescribed period. First of all it is important to note that, rules that govern accounting in books and that govern tax law such as service tax are different and should be followed individually. They should not be mixed as each one have different statue backing with them. In the accounting, the concerned point is about construction contracts, which is governed by AS-7 “Construction contracts”. The accounting in the books shall be done as per above standard (as the same is mandatory in nature). As per this AS revenue and cost should be recognized as per % of completion method, where contract revenue is matched with contract cost incurred in reaching stage of completion. Contract revenue is recognized as revenue in the statement of profit and loss in the accounting periods in which the work is performed. Contract costs are usually recognized as an expense in the statement of profit and loss in the accounting periods in which the work to which they relate is performed. In such a case, the agreement between contractor and contractee becomes important. This is because payment is made on continuous basis and invoice is raised in accordance with the relevant agreement. This agreement decides date of making payment and the date on which invoice is raised. In such a situation, payment of service tax as per Rule 3 of the Point of Taxation Rules, 2011 shall be made at the time of making payment or date of raising invoice which ever is earlier. Thus, the account should be prepared as per relevant statue i.e. AS-7 “Construction contract” and service tax should be paid as per Rule 3 of Point of Taxation Rules, 2011.
Dear Sir, I want to know that can an Assessee registered with excise department perform 100% job work task with out performing any kind of manufacturing activity on his own, if yes than the circular in this regard. CA. Shantanu Bist (Posted On: 15 Nov, 2011)

There is no circular avaialble but there is no ban also on doing 100% job work. The central excise registration is taken for the goods to be manufactured. If no goods are manufactured then no duty is payable.
Dear sir I have filled the form no 15 CA. During the filing of form 15ca i do one mistake. i have entered the wrong 15cb certificate no in form 15ca. now what is te process for rectifying it. parul (Posted On: 10 Nov, 2011)

This query does not fall under the fields for which we provide service. We are dealing in Central Excise, service tax, custom and DGFT.
we undertook survey abroad in respect to our product which is not excisable and paid Service Tax on the payments made in FOREX.We are simultaneously outservice provider in the category of AMC. Can i avail Cenvat of the said ST paid. sanjay gupta (Posted On: 03 Nov, 2011)

The finished good is exempted from payment of excise duty, then as per Rule 6 (1) of the Cenvat Credit Rules, 2004 the cenvat credit of input services utilized in relation to exempted finished goods will not be available. Also, the output service provided by you has no nexus with the service utilised by you, therefore, the cenvat credit of service tax paid on the Forex services will not be available to you.
Dear Sir half yearly service tax return must fill up online submit or manual submit to department pls.send your suggestion sir... rahul (Posted On: 20 Oct, 2011)

It is compulsory to file online return from October 1,2011. But the date of filing of online return has been extended from October 25 to December 26.
respected sir please send me detail procedure to e-file form EXP-2 (service tax). Sir your early response will be highly appreciated as last date to file EXP-2 is 15 october 2011. CA Manoj Sharma (Posted On: 12 Oct, 2011)

The format of EXP-2 is available on our website. It is to be filed in that format only. The relevant shipping along with other export documents as well as original bills of service provider are to be submitted. The certification is also to be done. The transport of road as well as commission to foreign agent under BAS service is exempted under notificaiton 18/2009 and return in respect of these services are to be filed.
WILL GST BE IMPLEMENTED FROM 01-04-2012.WHAT IS THE LATEST NEWS ON IT. mehul.m.ashar (Posted On: 11 Oct, 2011)

The consitutional amendment is still pending. thus, it seems to be difficult to be implemented from 1.4.2012. After the amendment passed by both houses, it has to be passed by all states. Thereafter the GST bill will be proposed and will be discussed with all concerned i.e. Centre, State and trade associaiton will discuss the same. Thereafter it will be passed. Since, it is said that all the returns as well as registration will be online, hence the software based on law will be placed and discussed. There after the GST will be implemented. But till now, the centre and states are fighting on the same. Even TN chief minister has objected on GST implementation.
what is the punishment on late e-filing of er-1 at present. mehul.m.ashar (Posted On: 11 Oct, 2011)

For late e-filing of ER-1 return under the Central Excise Rules, 2002 the provision of general penalty under Rule 27 will apply as no specific provision has been provided. Under this Rule, for contravention of any of the provisions of Central Excise Rules, where no penalty is provided elsewhere penalty of Rs. 5, 000/- will be imposable. Similar provision is provided under Rule 15A of the Cenvat Credit Rules, 2004.
i have paid by mistake Rs.40000 in the excise pay code no.00380115 instead of in 00380003 so can i get refund from central excise department. mehul.m.ashar (Posted On: 08 Oct, 2011)

If there is minor mistake in writing accounting code then it could be condoned. But if you have paid the amount twice i.e. one under wrong head and one under coorect head then you can apply for refund from the department.
what is the excisable procedure to sell goods if we receive part qty.as sales return from a non-excisable trader. mehul.m.ashar (Posted On: 08 Oct, 2011)

We have already replied the query raised by you. However, we are once again producing the reply for your ready referenc:- "From the query, it seems that you are excise registered unit and intend to sale the input as such on which no credit is taken as it is received from non- excisable trader. It has to be removed under Excise invocie under Rule 11 and there is no need of reversal of Cenvat credit as no credit is taken." If the facts understood by us are wrong, do revert back to us to reply the same.
I had got registered in 2002 with number starting with ST. I had not taken pan based number & had been filing nil return since 2004 as turnover was less than threshhold limit. Now aces doesn't accept st no, how i should file the return under aces. Whether ihave totake fresh no & surrnder the old no or there is a way out. I am registered at commessionerate Delhi II jitander khattar (Posted On: 07 Oct, 2011)

You have to apply afresh & apply for registration to the department. When you submit the documents of registration to the department clearly mention the facts in the forwarding letter that you are already registered and filing return manually on regualar basis.
One of our group company is an Exporter of Iron ore. It has used various input services during the course of export, after paying service tax. It sought to avail the refund under Notification 41 / 2007 dt.6.10.2007. It has not filed the claim at the end of relevant quarter. The adjudicating authority has proposed to reject the claim. Is there any case law that the period in section 11 B prevails over the period mentioned in the notification ? belavendiran (Posted On: 07 Oct, 2011)

We have not come across such case law. On the contrary, the legal position is against us. The following decisions clearly says that the time limitation under Section 11B does not apply in such cases:- a. 2009-TIOL-1463-CESTAT-AHM b. 2011-TIOL-68-CESTAT-MAD c. 2010-TIOL-1526-CESTAT- AHM
Recently notifcation regarding mandatory efiling of central excsie return is published.The word used that it is mandatory for all assesses.I would like to know if unit paid duty less than 1 cror for previous financial yea,.Is it necessary to them to efile er4,er5 and er6? Our local range office make interpreting that it is mandatory to all assesses without limit of duty paid. SANDEEP (Posted On: 06 Oct, 2011)

When the law says that the return is to be filed if the assessee has paid more than Rs. one crore from PLA+Cenvat then there is no question of filing it manually or online. Thus, the contention of the department is not tenable.
is service tax paid on courier services were available to utilise the excide duty to be paid on finished goods which are about to remove K Venkata Appa Rao (Posted On: 04 Oct, 2011)

As per High Court decision of Ultratech Cement, the credit is available on business expenditure. Courier service is business expenditure only and credit on the same is avaialbe. Furhter, as per latest amendment also, it does not fall under exclusion category. Hence the credit on courier service is allowed. Further, as per latest amendment, credit of service tax is avaialbe on receipt of invoice provided the payment of the same is made within three months of taking of credit. Hence, you can take the credit immediately on receipt of invoice and utilse the same in payment of excise duty on your final product.
what is the excisable procedure to sell goods if we receive part qty. from a non-excisable trader. mehul.m.ashar (Posted On: 03 Oct, 2011)

From the query, it seems that you are excise registered unit and intend to sale the input as such on which no credit is taken as it is received from non- excisable trader. It has to be removed under Excise invocie under Rule 11 and there is no need of reversal of Cenvat credit as no credit is taken.
is it liable for an assessee to file er-4,er-5,er-6 according to the notification no.21/2011 & 22/2011 dated 14-09-2011 paying duty more than 10 laks & less than 1 crore mehul.m.ashar (Posted On: 01 Oct, 2011)

The unit has to file the ER-4, ER-5 and ER-6 is if he is paying Excise duty more than Rs. one crore from PLA plus cenvat. Thus, when there is no need to file the return if you are paying less than Rs. one crore, then there is no question of filing it electronically.
we have Received the security amount regarding to complex on lease, 50 % amount out of the security will be adjusted with the rent income in coming 12 months. My question is 50 % security amount which shall be adjusted with future rent shall be treated as a advance against of rent or not and what we will be liable for pay service tax on advance payment received? NAVIN JAIN (Posted On: 26 Sep, 2011)

If the security amount received by you clearly say that it is adjustable with the advance then it is clear that it is advance rent only. In that case, the service tax is payable on the same. The point of taxation says that the invocie or payment whichever is earlier.
what is the excisable procedure to sell goods which are received from non-excisable trader as sales return. mehul.m.ashar (Posted On: 24 Sep, 2011)

Firstly, for sales return, the non excisable trader will send the challan clearly saying that he is not taken cenvat credit. He will also send the "Duplicate for transporter" copy of manufacturer invoice along with goods. on the basis of these documents, the manufacturer can take credit under Rule 16. Now on resale of these goods, if the process undertaken amounts to manufacture then duty is to be paid on return of material. In case the process does not amount to manufacture then it has to be cleared on reversal of cenvat credit. In both situations, the goods will be cleared under the cover of invoice issued under Rule 11 of Central Excise Rules, 2002.
what is the procedure to sell goods to sez unit from a excisable unit. mehul.m.ashar (Posted On: 24 Sep, 2011)

It will be sold under ARE-1 procedure.
WE ARE 100% EOU UNIT, WE PURCHASE INDIGINEUOS RAW MATERAL UNDER CT-3, WHICH IS CT-3 CERTIFICATE VALIDITY PERIOD? ashok makwana (Posted On: 24 Sep, 2011)

There is no specified period for the same. But if the CT-3 mentions the period then that will be valid period for CT-3 certificate.
we are registered under the mandap keepers category and want to know about the abtements available to us we are having an cenvat credit also kindly advise us in such an manner that our laibility of service tax should not increase and also the cenvat credit is not wasted Rani kothi Banquets Pvt Ltd (Posted On: 24 Sep, 2011)

The rate of abatement for Mandap keeper under Notificaiton number 1/2006-ST dated 1.3.2006 and as amended is 40% i.e. you have to pay the service tax on 60% of value. Regarding second query, the balance of unutilised credit can be used in payment of service tax. The notification 1/2006 debars on taking of cenvat credit on inputs, input service and capital goods used in providing such service. Thus, firtly, it resricts taking and not utilising. Secondly, it restricts credit on such input, input service and capital goods which are used for providing such Mandap keeper service. If the same service provider is providing other serivce or manufacturer of excisable goods then he can take credit on input, input service and capital goods used in providing these services or manufacture of dutiable final product. There is no one to one co-reltaiton in Cenvat credit. Hence the credit already earned can be used for payment of any service tax.
whether debited 2%, and 1% from cenvat10% ? ashokbhai (Posted On: 24 Sep, 2011)

No. The Education cess and SHE cess can be debited from the balance of Education cess and SHE cess and not from Basic Excise duty.
we are SSI manufacturing & availing cenvat credit, unit, our turnover rs. 3.5crore, now regarding job work we are sent material for job work excisable goods and non excisable goods from outside, whether we make annexure-II Challan or only simple challan. for this material under SSI UNIT. ashok makwana (Posted On: 22 Sep, 2011)

You have to follow the procedure under notificaiton 83/94 and 84/94 in this regard. As per procedure, you have to give undertaking to the AC/DC of job worker under the above notificaiton.
whether service tax payable on job work/charges ? ashok makwana (Posted On: 15 Sep, 2011)

For seeing the liability of service tax on job work, process undertaken is most important. If the process undertaken in job work amounts to manufacture then no service tax is payable. Further, if it does not amount to manufacture, but if the Central Excise manufacturer is supplying the goods and is using the same in manufacture of his dutiable final product then exemption is available under notificaiton 8/2005. Otherwise the serivce tax is payable. It is also to be seen if the job work is relating to textile processing, agriculture etc then also exemption is avaiable.
Whether debited education cess and S.H.ED. FROM CENVAT ACCOUNT? ashok makwana (Posted On: 15 Sep, 2011)

The cenvat credit of education cess and Secondary and Higher education cess is avaiable. The education cess and SHE cess payable can be paid from the credit avaiable in these accounts.
kindly sent the notification copy for service provider submission invoice within 15days of service proved. and new notification copy for service tax deposit. Mahendra Chouhan (Posted On: 10 Sep, 2011)

With reference to your query of raising of invoice, we submit that Rule 4A of Service tax Rules already provided for raising of invoice within 14 days (not 15 days) of raising of invoice. Now, it is also mentioned in Point of Taxation Rules introduced by notification 18/2011-ST dated 13.2011 and assessee was given option to follow the same either from 1.4.2011 or from 1.7.2011.
is the time bar clause applicabe for imposition of penalty under section 76 in cases where no tax recovery is pending i.e. SCN is to be issued in 1/5 years period as the case may be. sanjay gupta (Posted On: 09 Sep, 2011)

Penalty under Section 76 is imposed for late payment of service tax. The demand for recovery of service tax is issued under Section 73. These are two separate things. The demand is issued within one year from the date of filing of return. But demand within period of 5 years can be issued if there is fraud, willful suppression of facts, collusion or any contravention of any provision of service tax with an intent to evade payment of duty. The penal action under Section 76 can be proposed in both types of demands.
In my view the penalty under section 76 is mandatory in case of late payment of tax and no scn is required to be issued for recovery nor recovery of said penalty is time barred.Kindly confirm the views. sanjay gupta (Posted On: 01 Sep, 2011)

Penalty U/s 76 can be imposed only when the department issues show cause notice. It means penalty can be imposed by the department only after completion of adjudication. Assessee cannot pay penalty on Suo Moto basis. If the assessee proves that there is reasonable cause to failure for the payment of service tax along with interest and department satisfy from the contention of the assessee then department can waive the penalty U/s 80.
One of my client is Providing Labour to a Contractor who is having Contract for Laoding unloading to the ships arrived on the port. The main contractor is charging and receiving Service tax from the party. My client had underbonafide belief not charged service tax on contractor. Now Servie Ta authority insist to pay the tax for 5 years from my client. Though the Revenue is not looser in this case. Please advise Haresh Raithatha (Posted On: 01 Sep, 2011)

According to the sec 65(105)(k) “any service provided or to be provided by a person , by a manpower recruitment or supply agency in relation to the recruitment or supply of manpower, temporarily or otherwise is a taxable service”. Accordingly, the service provided by the client is classifiable under the head manpower recruitment agency and since the definition also covers the phrase “supply of manpower, temporarily or otherwise” the supply of labour even if temporarily is covered under the same. Thus the demand raised by the department is justified. We suggest you to take the registration (if not taken) and pay service tax with interest as applicable under the head manpower recruitment as early as possible
I read your useful article on aces at taxguru portal. I have one question in my mind about surrender of ST-2. The question is as under: 1. Whether we have to file any physical documents in the departments after uploading surrender application at aces. 2. if yes, please provide me the list of documents. Ravinder Bajaj (Posted On: 31 Aug, 2011)

You have to file the original ST-2 certificate along with the downloaded application. Normally, service provider surrender the registration when they are availing threshold exemption under notification 6/2005. In such cases, some departmental authorities also ask for last two returns to check whether the assessee is eligible for such exemption.
whether interest is payable on late filing of proof of exports in case when proof of exports are received after 6 months of clearance. Manish Thakkar (Posted On: 19 Aug, 2011)

The proof of export is to be filed within six months of date of export and not from the date of clearance. Secondly, if the export is not filed within such period then the duty is payable by exporter himself.When the duty is paid then interest is also payable.
In an export related rebate the exporter has to follow incoterms. Value for claimimg rebate of duty paid goods exported will be transaction value -Sec.4 - Exworks. Suppose transaction value for export is 1Lakh and exporter incurs expense for others for delivery to ship say 50,000/ Now duty payable @ 10 % eExicse duty on transaction vlaue os 10,000/ plus 5,000/ total 15,000/ Now while sanctioning rebate AC orders rebate in cash 10,000/ and in cenvat 5000/ In my opinion this is wrong. Please clarify and i wnat to know your views on this practice followed. By, M.RAM KUMAR, SUPDT OF CE, BANGALORE M.RAM KUMAR (Posted On: 19 Aug, 2011)

The rebate claim should be sanctioned in cash of duty paid by exporter.The "place of removal" as defined in Section 4 says plthat any other place or premises where the excisable are sold then it is "place of removal". If the port is place of removal then duty is payable on sale value on place of removal. Also, as per master circular 97/8/2007, the Cenvat credit is allowed on outward freight if manufacture is able to establish that sale has taken place at destination. Following the same, exporter has to pay the duty upto port if sale takes palce at port. Furhtermore, the transaction value can be less than, equal or more than FOB value of goods as per Chapter 7.1 of Part-II of Supplementary instructions issued by CBEC. Moreover, the assessment is finalised by Superintendent at the time of submission of ARE-1 (within 24 hours of export) as per para 6.3 ibid or para 4.5 of chapter 8. When the assessment is finalised then AC/DC cannot challenge the same unless it is appealed as per Apex Court decision in case of Flocks India. Hence, the assessment done by superintendent is final then duty paid by exorter should be refunded.
polyester sub heading manojkawad (Posted On: 18 Aug, 2011)

3907
can we avail the cenvat benefit on GTA paid. Please note that GTA paid after availing the benefit of abetment mehul p shah (Posted On: 10 Aug, 2011)

We can avail the benefit of GTA paid on transportation of inputs and capital goods if you are manufacturer of dutiable goods or taxable service provider. This is given under definition of "input services". Under the abatement notificaiton 1/2006, the rest
Whether pay duty on non matching SION in eou unit? whether pay duty agianst non realise export forign payment? in eou Ashok Makwana (Posted On: 10 Aug, 2011)

SION are applicable in advance authorisaion, DFIA scheme but not for 100% EOU scheme. Secondly, if the positive NFE is not there, then the department may ask for the duty.
Assessee having manufacture branded & non branded sweingh machine and have registered under Excise Duty @1%. whether it is required to show the turnover of non branded item sale in ER8 return. VINOD AGARWAL (Posted On: 08 Aug, 2011)

It seems that non branded sewing machine is exempted.The manufacturer registered with Central Excise department has to show details of both dutiable and exemtped clearances in his returns.
The query raised by you is that - I am doing the business of manufacturing of doors, windows, partitions using aluminum, glass materials from 01.04.2005. From 01.04.2005 to 31.03.2009, I did work for companies engaged in the construction of residential fl Omika Financial Consultants (Posted On: 05 Aug, 2011)

This opinion has been given to the best of our knowledge and belief. The Service Tax law is subject to various amendments and judicial pronouncements. Our opinion is also subject to the same. Your Need Our Concern… Thanking you, Regards, Prade
The query raised by you is that could you please advise how to clear Excisable Goods to be exported as Free Sample to an overseas customer? unni menon (Posted On: 05 Aug, 2011)

The Foreign Trade Policy, 2009-14 provides for export of samples as under: 2.30 Export of samples and Free of charge goods shall be governed by provisions given in HBP v1. And in the Handbook of Procedure, Vol-I it has been provided in Para 2.27 tha
We have been registered in central excise as a manufacturer of certain products. Now we are in the process of getting a works contract, which includes excisable products some of which we manufacture and some we need to buy. Can we do this business also? W unknown (Posted On: 05 Aug, 2011)

We need to pay the excise duty on good manufactured by you. Regarding trading goods there will not be any liability on you. Since you have not told the exact nature of works contract undertaken by you, we cannot comment on the same. You have to study t
Whether the LR (Lorry receipt) issued by the Transporter can be taken as evidence of payment of Service Tax. The LRs issued by the transporters contained their Service Tax registration number and the service tax & education cess. Otherwise any other docum unknown (Posted On: 05 Aug, 2011)

First of all, one has to see whether the consignor or consignee, whomsoever pays the freight amount to the transporter is liable for payment of service tax if he falls under seven category mentioned in Rule 2(1)(d) (iv) of Service Tax Rules. This is repro
If material cleared against CT3, to a 100% EOU without duty vide ARE3, in the ER1 whether this should be shown as export under Bond, if so system prompts to give the Non Tariff Noti. No. & Sr. no. whereas in the CT3 the Notification mentioned is Tariff No unknown (Posted On: 05 Aug, 2011)

The material supplied against CT-3 to a 100% EOU vide ARE-3 does not fall under the category of export under bond, so in the option whether there is export, you have to show that there is no export. The final export is not done by you. You have only suppl
Whether Service Tax Credit can be claimed based on the Soft copy of the Invoice. Cellular Mobile Usage Monthly Bills for all the employees in our organization (Connection taken in Company Name). Please advice. unknown (Posted On: 05 Aug, 2011)

Service Tax cannot be availed on the soft copy of invoice. The valid duty paying documents are listed in Rule 9 of Cenvat credit Rules. The department allows the credit on original invoice issued by service provider. Even there is lot of litigation on cre
The nature of business is dealership of Maruti and Service Station. For the F.Y 2009-2010 the gross turn over was Rs. 40 Crore. Indirect income was Rs. 2.66 Crore. Indirect income liable to service tax under authorized Service Station. First query - S unknown (Posted On: 05 Aug, 2011)

Reply to First Query: The definition of Input services under Rule 2 (l) of the Cenvat Credit Rules, 2004 provides that the services of advertising and sales promotion are in the nature of input services and therefore, service tax paid on these input servi
I have bought a two bedroom apartment with provident housing unit (purvankara builders in Chennai Pudupakkam) and the total cost of the property is 18, 44, 090/-. As per the current service tax rules if the cost of the property is less than 20 lakhs it is unknown (Posted On: 05 Aug, 2011)

Notification No. 6/2005-ST dated 01.03.2005 as amended by Notification No. 8/2008-ST dated 01.03.2008, has prescribed the threshold limit of Rs. 10 lakhs on which service tax exemption can be claimed. Under the Construction of Complex service, it has
M/s Laxmi Snacks Pvt. Limited (hereinafter has referred as querist) has approached us with a query regarding applicability of rate of duty on his products sold under the brand name of “Real”. This is to be decided in the context of the recent levy of 1% e unknown (Posted On: 05 Aug, 2011)

1. Bites:- This product comprise of bikaneri and ratlami sev, chana dal, moong dal and other mixtures. For deciding the rate of duty, first of all one has decide the classification of a product. The querist is selling various kinds of namkeens, Bhujia and
Please give me advice on Export House. unknown (Posted On: 05 Aug, 2011)

For getting the status of an Export House the provisions have been prescribed in Para 3.10 of the Foreign Trade Policy, 2009-14. Eligibility: Following person will be eligible for status of Export House: - Merchant and Manufacturer Exporters - Serv
RAM books a Flat No. G-12 in 2008. Flat is 65% completed up to 30 June 2010. RAM is not able to pay value of that 65% to builder. So he makes surrender to builder. Builder refunds the amount to RAM. After that, the builder makes fresh booking of that flat unknown (Posted On: 05 Aug, 2011)

The Budget 2010 expanded the scope of ‘Construction of Complex Service’ [Section 65(105) (zzzh)] and ‘Commercial or industrial construction service’ [Section 65(105) (zzq)]. It was provided that unless the entire consideration for the property is paid aft
If construction is 85% completed on 01-07-2010 and we obtained certificate from Architect regarding completion of construction as on 01-07-2010. Whether any service tax will be leviable on 85% portion even if payment for that is received in November 2010. unknown (Posted On: 05 Aug, 2011)

The levy of service tax is not related to raising of bill or with the receipt of amount charged in bill. For levy of service tax, it is required to be seen when the service was provided. In this regard, the Gujarat High Court in the case of Commissioner o
Contractor adopts Notification no. 1/2006, so he liable to charged service tax @3.399% after taking abatement. He raises bill to contractee as follows: Value of work done: 10 Lakh Service tax @ 3.399% 33990 Total 1033990 or he has to raise unknown (Posted On: 05 Aug, 2011)

Notification No. 1/2006-ST dated 01.03.2006 granting abatement provides as under: In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the Finance Act), the Central Gover
We are received the Service which comes under the ambit of Service Tax. And our unit is exempt U/s 80IC. I received below the details of the bill raised by contractor: Eg: All figures are just approximate and not real Wages unknown (Posted On: 05 Aug, 2011)

In Service Tax (Determination of Value) Rules, 2006, it has been provided as under: 5. Inclusion in or exclusion from value of certain expenditure or costs.– (1)Where any expenditure or costs are incurred by the service provider in the course of pro
Our company is established in Kala-amb(himachal pradesh ) ( and due to 50 /2003 - CENTRAL EXCISE, Dated: June 10, 2003 “G.S.R (E) .- In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944) read with unknown (Posted On: 05 Aug, 2011)

The levy of service tax is not related to raising of bill or with the receipt of amount charged in bill. For levy of service tax, it is required to be seen when the service was provided. In this regard, the Gujarat High Court in the case of Commissioner o
Our company is established in Kala-amb(himachal pradesh ) ( and due to 50 /2003 - CENTRAL EXCISE, Dated: June 10, 2003 “G.S.R (E) .- In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944) read with unknown (Posted On: 05 Aug, 2011)

Our company is established in Kala-amb(himachal pradesh ) ( and due to 50 /2003 - CENTRAL EXCISE, Dated: June 10, 2003 “G.S.R (E) .- In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944) read with
We are Manufacturer Exporter But we are not registered with the Central Excise Act, 1944 due to our Produce is exempted in Excise act. Please advice where we file our Service Tax refund claim as per Notification No. 17/2009 in the following situation? unknown (Posted On: 05 Aug, 2011)

As provided in Para (2) of the Notification No. 17/2009-ST dated 07.07.09, you will have to file the refund claim at the Excise Division, more particularly, to the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise, as t
I am keen to know the implication of service tax paid in case of GTA. Please reply who is the person capable of claiming credit of service tax paid and legal backing. (i) If service tax is paid by the service receiver; (ii) If service tax is paid by unknown (Posted On: 05 Aug, 2011)

As per Section 2 (1) (d) (v) of the Service Tax Rules, 1994, in case of Goods Transport Agency service the person liable to pay the service tax to the Government is the service recipient. The said Rule is reproduced hereunder for ready reference: (d) "
We received payment from buyer for Flat as per completion method. When a particular work is completed i.e. say DPC, roof, flooring etc. then we demand that money from buyer. We raised demand letter to buyer. Possession of flat will be given after completi unknown (Posted On: 05 Aug, 2011)

When the service is not provided and payment is received then it can be termed as advance. But in this case you have provided services partly and received payment for the same, it will not be advance. It will be termed as payment received for services pro
One of my friends is doing transportation business but do not have any trucks or other carrier but are hiring from private vehicles and dispatching consignments of factories on his L/R he has been registered with Service tax in the beginning of 2005 but w unknown (Posted On: 05 Aug, 2011)

You will have to login in ACES.gov.in in service tax section and take the cursor on REG. Immediately a small box will be displayed containing many option. You have to go on to the option of Amend Registration. Then a window will open and you have to c
Q1:- If the assessee has paid Service Tax wrongly (which is not to be paid), whether they are entitled for refund? Q2:- Whether they can take Credit of the same amount in Excise CENVAT? unknown (Posted On: 05 Aug, 2011)

In case, an assessee has paid service tax wrongly which was not required to be paid, then the assessee can file for refund of the amount wrongly paid under Section 11B of the Central Excise Act, 1944. The provisions of the Section 11B have been made appli
Q.1:- In which Rule, the assessee can clear the raw material (Inputs) for further process / jobwork, outside the factory premises / Warehouse? Q.2:- What kinds of Documents have to be submitted to Central Excise Range Authorities? Q.3:- Whether the unknown (Posted On: 05 Aug, 2011)

Q. 1 Reply: In case the assessee has availed cenvat credit on the inputs, then he can clear the goods to the premises of jobwork for further processing under Rule 4(5) (a) of the Cenvat Credit Rules, 2004 or under Notification no. 214/86-C.E. dated 25.03.
1. Which Cost and charges is taxable? (Basic Cost, Prime Location Charges, External Electrical Charges, Fire Fitting Charges, , External Development Charges, Open Car Parking, Covered Car Parking, Store, Shop, Power Backup Charges, Lease Rent, Club Member unknown (Posted On: 05 Aug, 2011)

In the definition of commercial construction in Section 65 of the Finance Act, 1994, it has been specified the services which will fall under the scope of construction service. The said definition is reproduced hereunder for your ready reference: (25b)
A person received Rs. 15 lakh advance in F.Y 2010-11. Can he avail basic exemption of Rs. 10 Lakh in F.Y 2011-2012? Please clarify. unknown (Posted On: 05 Aug, 2011)

As per Notification No. 6/2005-ST, dated 01.03.2005, the threshold exemption in the current financial year will be available if the aggregate value of taxable service provided does not exceed the prescribed limit of Rs. 10 lakhs in the previous financial
We would like to use dutiable materials in exempted product manufacturing by reversing the proportionate Cenvat credit before utilization in manufacture of exempted product. Hence kindly advice us whether it is possible w.r.t. Rule 6 (3) II of Cenvat Cred unknown (Posted On: 05 Aug, 2011)

Rule 6(1) of the Cenvat Credit Rules, 2004 provides as under: (1) The CENVAT credit shall not be allowed on such quantity of input or input service which is used in the manufacture of exempted goods or for provision of exempted services, except in the
We are in receipt of your query asking for the link of website for filing return. The second query asked is that one of your clients has paid service tax of Rs. 500000 above during the current year. Whether filing of service tax return is compulsory? unknown (Posted On: 05 Aug, 2011)

In this regard, we submit that the website for filing service tax return is - www.aces.gov.in. You are required to obtain user name and password for logging into the same. Regarding the second query, you have written that your client has paid service
We are Importer of all type of computer parts & Networking products from China, USA, Malaysia & Taiwan. Now we are thinking to expand our business by export of goods. We need your valued guidance of Export procedure & get more benefit of various type of I unknown (Posted On: 05 Aug, 2011)

Export Procedure: The export of goods can be done on payment of duty and under rebate claim under Rule 18 of the Central Excise Rules, 2004. Or export can be done without payment of duty under bond under Rule 19 of the Central Excise Rules, 2004. T
We are manufacturer of bathroom fitting items under Ch. No. 84819090, 84818020, 74181990. These all items are made from brass. Recently, we have imported shower from China under Chapter heading No. 39229000. Now we are selling this item in domestic market unknown (Posted On: 05 Aug, 2011)

The goods which are being imported by you are being sold in the domestic market after packing and affixing of your brand name. The said goods are not being used as inputs in the manufacture of your finished goods. Under the Cenvat Credit Rules, 2004 credi
Please send the C.E.T Subheading no. of PP Woven Fabric, PP Woven Bags, PP Woven Wastages & Pet Preform. unknown (Posted On: 05 Aug, 2011)

The Tariff Heading of the aforesaid goods under the First Schedule to the Central Excise Tariff Act are as under: Sr. No. Name of the Good Description in Tariff Tariff Heading 1. PP Woven Fabric Polypropylene articles, not elsewhere specified or inclu
1) How do we fulfill EPCG liability with 3rd party export? (2) What are the new products added SHIS as done for zero duty EPCG scheme? (3) What is new Annual EPCG Scheme for exporters? Unknown (Posted On: 04 Aug, 2011)

Query-1: - As per Para 5.3 of the Foreign Trade Policy, the exports made through merchant exporter is eligible for being covered under EPCG scheme. The said para is reproduced hereunder for your ready reference: Eligibility 5.3 EPCG scheme covers m
One of your clients is Proprietary concern which is manufacturing and supplying dairy equipments to specified persons as per the Act and availing GTA service. Some of the transporters have collected Service Tax and Education cess from them and the same ha Unknown (Posted On: 04 Aug, 2011)

In this matter, Rule 2(1)(d)(v) of the Service Tax Rules, 1994 is important. It says that the liability to pay the service tax in the Government exchequer is on the service recipient in case of specified class of person pays the freight amount either as c
A builder (Private Ltd Company) has 2 residential projects, one in Delhi & second in Bombay. Company book one flat of buyer say RAM in Delhi project on April 2009 and received Rs. 5 lakh. But project is cancelled or not started so company as per buyer dis Unknown (Posted On: 04 Aug, 2011)

As per Explanation (a) to Section 67 of the Finance Act, ‘consideration’ includes any amount that is payable for the taxable services provided or to be provided; Thus, service tax will be payable on the amount given as advance. The amount was receiv
With the Construction of residential complex service being taxed under service tax from 01.07.2010, whether the amount received towards parking space will also be taxed? If exempt then under which notification it is exempt? Is there any limit for flats so Unknown (Posted On: 04 Aug, 2011)

In the TRU letter no. 334/1/2010-TRU dated 26.02.2010, all the amendments introduced by the Budget 2010 were explained. In Annexure-A to the said letter, the amendments relating to Construction of residential complexes has been explained. In the para 8.2
We have imported some material from Spain in 2005 & 2007 out of which some items are not performing and we needs to give them replacement and the defected items to be sent letter on to Spain. Please give the comments on the following procedure: 1. If Unknown (Posted On: 04 Aug, 2011)

As per Chapter 6 of the Export Promotion Capital Goods Scheme, the Capital Goods imported under the scheme and found defective or otherwise unfit for use may be re-exported and Capital Goods in replacement thereof be imported under the scheme. In such cas
I would like to clear a doubt. This is with regard to a payment made to a company in UAE as insurance commission for Referrals they made. While making the payment we had paid the service tax from our pocket. But while making the service tax payment th Unknown (Posted On: 04 Aug, 2011)

You have received the service from the company in UAE therefore, there is import of service. As per import of service Rules, the liability to pay service tax is on the service recipient who is receiving service in India. Therefore, you were liable to pay
We are manufacturing of Dairy equipment, which is part of engineering industry. Our excise no is AADCS2084CXM001. Major of our product which is coming under category is 84342000. We are manufacture of Dairy equipment specialised in Ice cream Industry. A Unknown (Posted On: 04 Aug, 2011)

Before applying for DEPB scheme, it is necessary to ascertain that our product is listed in the DEPB Schedule Rate. We have gone through the DEPB Schedule and found that following entries may be relevant in the Engineering Products. 588 Hermetically Sea
I am a practicing chartered accountant in Jaipur, Rajasthan. One of my client recently started a factory of making tasla from (F.Y. 08-09) and his turnover is going to cross 3.5 crore in this financial year whether he is in ambit of central excise. Please Unknown (Posted On: 04 Aug, 2011)

The provisions for Small scale exemption are given in Notification No. 8/2003-CE, dated 01.03.03. It is provided that SSI exemption will be available if the clearances during the previous financial year did not exceed Rs. 4 Crores. The SSI exemption will
Is the time limit for filing the Refund claim for the Input service tax in case of the Sec 10 B companies who are 100% export and STPI companies - is one year or 60 days from the end of the quarter. Please clarify. Unknown (Posted On: 04 Aug, 2011)

There are two type of refund claim available to 100% EOU. One is of unutilized Cenvat credit under Rule 5 of Cenvat credit Rule. 100% EOU can take the Cenvat credit and if the credit is utilized by them then the same can be claimed as refund. In such type
If the proprietorship firm covered under audit u/s 44AB is paying Freight on purchases, and he is not registered in service tax department, is service tax liability will be created on GTA. Unknown (Posted On: 04 Aug, 2011)

As per Rule 2 (1) (d) (v) of the Service Tax Rules, 1994 only following seven categories of consignor/consignee of goods are themselves liable to pay service tax: - (a) any factory registered under or governed by the Factories Act, 1948 (63 of 1948
We are providing services to our customers taking services from a C& F agent who falls below the threshold limit and therefore, does not charge Service Tax in his bill. We also provide other services as business auxiliary services. How the same should be Unknown (Posted On: 04 Aug, 2011)

In your bill issued to your customers you are required to show the services provided under BAS as well as of C& F service. But since no service tax is charged by the C&F Agent whose services you are utilizing to provide output service, you have to mention
If few permanent employees of a Holding company is working in the Subsidiary Company for the last one year and subsidiary company is making payment of salary of employees to Holding Company. Should Holding company charge the service tax from subsidiary co Unknown (Posted On: 04 Aug, 2011)

Yes, Service tax is to be charged by the Holding Company from the subsidiary company. However, under which category of service the service tax is to be charged will depend upon the type of work being rendered by the employees of the Holding Company in the
A person engaged in Hotel business is also doing Boating operation. The boating is arranged by charging the individual at a specific rate per trip. The Central Excise department official are contending that the Hotel operation is a tourism related ser Unknown (Posted On: 04 Aug, 2011)

Definition of Tour Operator is given in Section 65 (115) of the Finance Act, 1944 which is as under: - (115) "tour operator" means any person engaged in the business of planning, scheduling, organising or arranging tours (which may include arrangements
I have a query regarding certification of service tax paid in context of claiming the refund of the same. For the purpose of certifying the amount of service tax paid on goods exported (To claim refund of the same under notification no.17/2009) I am check Unknown (Posted On: 04 Aug, 2011)

Notification No. 17/2009-ST, dated 07.07.09 grants exemption from payment of service tax by way of refund. The refund of service tax is granted on the specified services which are utilised by the exporter for exporting their goods. The Notification pro
- How the Service Tax and VAT are applicable for sale of flats/Apartments? - Give guidance about the Accounting System of Apartment construction in the Books of Builder and owner. Unknown (Posted On: 04 Aug, 2011)

In this regard we submit that we are dealing specifically in Excise, Service Tax, Customs and DGFT matters. As per the Board Circular No. 108/02/2009-ST dated 29.01.09, there is no service tax on sale of flats. Therefore, VAT is applicable on sale of
During the financial year 2008-2009, the billed amount was Rs. 950000 and the amount received was Rs. 700000. The method adopted by the Querist for accounting is cash basis. For the financial year 2009-10, the amount expected to be billed is Rs. 1200 Unknown (Posted On: 04 Aug, 2011)

Notification No. 6/2005-ST, dated 01.03.05 provides an option to the service provider to avail exemption from tax leviable on taxable services of aggregate value not exceeding the prescribed limit in any financial year subject to the fulfillment of the co
We are in receipt of your mail in which the following query has been raised:- What would be the rate of service tax on contract entered after July 7th, 2009 where the developer supplies steel and cement free of cost to contractor? Unknown (Posted On: 04 Aug, 2011)

The Works Contract (Composition Scheme for Payment of Service Tax) Rules, 2007 has been amended vide Notification No. 23/2009-ST, dated 07.07.09. The Explanation to sub-rule (3) was amended to provide that the composition scheme would be available only to
We are in receipt of query about the applicability of service tax on amount collected from the clients during period of warranty for repair and maintenance. The authorised service station (assessee) is collecting amount from the customer towards extended Unknown (Posted On: 04 Aug, 2011)

In this respect we submit that in Notification No. 96/7/2007-ST dated 23.08.07 it has been clarified by the Board that In case service is provided by an authorised service station to a customer and the service provider receives the consideration for the s
The Querist is sending non-excisable scrap to M/s Universal Metals on Jobwork for manufacture of SS Ingots. Then the said SS Ingots are sent to Mangalam Alloys Limited by M/s Universal Metals on behalf of the Querist for further processing into SS Flats u Unknown (Posted On: 04 Aug, 2011)

The Querist can send the SS Flats for further processing into hot rolling into SS Patta/Patti on Jobwork basis under Notification No. 241/86-C.E, dated 25.03.86 provided conditions specified thereunder are satisfied. The extract from this notification is
Whether re-imported goods can be sent to a bonded premises and any process can be done therein? Unknown (Posted On: 04 Aug, 2011)

The Customs Notification No. 158/95-Cus, dated 14.11.95 provides “Exemption on goods and parts thereof, which are manufactured in India and notwithstanding whether manufactured by an Indian or foreign manufacture, when imported or re-imported for repairs,
What is the the procedure to be followed for re-import of goods by EOU. M/s Pelican Grani Marmo Pvt. Ltd (Posted On: 04 Aug, 2011)

Para 6.17 of the FTP provides for Replacement/Repair of imported/ indigenous goods. Para 6.17 (a) provides that: (a) General provisions of FTP relating to export / import of replacement / repair of goods would also apply equally to EOU / EHTP / STP / B
Under which category of service the service of advertising in a mall would fall under? Unknown (Posted On: 04 Aug, 2011)

The service of advertising in a mall will not fall under the category of advertising agency’s services. We submit our reasons as below:- Advertising Agency has been defined under Section 65(3) which is reproduced hereunder for ready reference:- ‘Adv
A trust has setup a water treatment plant and has given the running of the water treatment plant to a contractor who is supplying labour as well as the chemicals for the plant. The query rose what is the category of the service provided by the contractor. Unknown (Posted On: 04 Aug, 2011)

By giving the plant to the contractor the trust has outsourced the functioning of the plant to an outside agency. Normally the outsourcing comes under “Business Support Services”. But it is related to Business or commerce. But it is being provided to a ch
Is there any seprate register for maintaining the excisable sales return Manish (Posted On: 04 Aug, 2011)

Earlier there was separate register and was called D-3 register. Most of the units still follow the same. It contains the details of goods received back, process undertaken and material despatched once again.
One UNIT is MANUFACTURER OF CERAMIC MINERALS POWDER IS EXEMPTED FROM EXCISED. HE IS DOING JOB WORK THERE. THE fineshed GOODS ARE NOT EXCISABLE, AND IS NOT PAY ANY EX.DUTY ON JOB CHARGES. PL. ADVICE WHETHER HE IS LIABLE FOR SERVICE TAX ON JOB WORK PROCESES Sunil Bhila (Posted On: 29 Jul, 2011)

If the manufacturing process employed by the unit amounts to manufacture (though exempted by virtue of a notificiaton or chargeable to nil rate of duty) then there is no service tax. Service tax is applicable when the process undertaken by him does not am
Sir,one of our client is registered as Transport of good by road,it is a manufacturing concern,can it avail input tax credit of srvice tax input services & inputs for setoff from the excise duty payable ,even when it is not providing any output services a Arpit Khetan (Posted On: 28 Jul, 2011)

If he is a manufacturer of excisable goods and payin excise duty on his final product then he can take the credit on inputs and input services. He will be taking credit as he is manufacturing excisable goods and not due to the fact that he is paying servi
I have raise bill for service tax on 09.06.2011 and payment not recd. till date. So when i have to deposit s.tax to government h.j.rathod (Posted On: 01 Jul, 2011)

As per Point of Taxation rules, we have to pay the service tax on raising of invoice. But the option is given to service provider to opt for the same either from April 1, 2011 or from July 1, 2011. Hence, if the service provider has opted for the same fro
WHEATHER SEC 11B TIME LIMIT IS APPLICABLE TO RULE 5 OF CENVAT BECAUSE IN 11 B IN RELVANT DATE NOTHING IS MENTION ABOUT CENVAT CREDIT?? narendra kumar (Posted On: 10 Jun, 2011)

The time limit under Section 11B defines the time limit for filing of refund claim. Even notificaiton no. 5/2006 issued under Rule 5 also says that the time limit is to be determined as provided in Section 11B of Central Excise Rules. However, the rule do
When merchant exporter wish to export the excisable goods,then he has to submit B-1 General bond for security deposit. For this he has to take bank guarantee for any scheduled bank. But my question in what is the format of application of bank guarantee an Mitra Mazumder (Posted On: 06 Jun, 2011)

In case of export through merchant exporter, bond has to be executed. It can either be submitted by merchant exporter or manufactuer exporter. It is to be remembered that the liability to submit the proof of export is on the person who executes the bond w

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