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KKC in invoice of 31/5/16

Service Tax - Started By: - Sanjay Aggarwal - Dated:- 10-6-2016 Last Replied Date:- 25-6-2016 - Dear Sir,A service provider has raised the invoice on 31.05.2016 for service performed by them and they are charging the KKC in the invoice dated 31.05.2016. and the fact is that the payment will be made to them in june 2016.now my question is, eventhough payment will be made to them in june 2016, CAN THEY CHARGE KKC ON INVOICE DATED 31.05.2016 ? - Reply By Ganeshan Kalyani - The Reply = Ideally they .....

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efuse to pay KKC. However if the payment in respect of the invoice dated 31.5.2016 is made on or after 1.6.2016, then your service provider has to raise a supplementary invoice charging KKC on you in view of the provisions of rule 5 of Point of Taxation Rules, 2011 no tax shall be payable to the extent the invoice has been issued and the payment received against such invoice before such service became taxable . As per Explanation 1 apended to this rule the same rule shall apply mutatis mutandis .....

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Reply = the raising of invoice is of no avail as the amount payable on account of provision of service is being remitted at a later date, i.e., after the date when the new Cess becomes payable. therefore, the payment of Cess will be the date for accountal of settlement of tax arrears, if any. In case payment is received after 1st June when the new CEss is levied; the assessee would have no option. as the assessee knows in advance that the money is not yet arrived in his account and would be comi .....

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