Adjustment of service tax liability - defective invoice, Service Tax

[madhavvan n]

a company has been charging service tax at 12.36% from 24th feb 09 till date what are the consequences can it adjust the excess tax collected against its st liability and can the customers who have received the services claim the cenvat credit on 12.36% or 10.30% and will the st invoice be treated as defective due to wrong st rate charged what are the consequences for the service provider and receiver

Posts / Replies

[Rama Krishana]

Once you charge service tax at the rate of 12.36% in the bill, even after reduction of rate to 10.3%, you should deposit the same. However, if the service recipient denies to pay you at the rate of 12.6%, you must correct the same either by cancelling the old Invoice or by issuing debit / credit notes to this regard.

[R.S. Mangal]

The service provider has to deposit the excess ST collected. In my opinion the service recepient can avail the cenvat for the ST paid. In case the payment is yet to be made then the service provider can revise the bill and collect correct ST.