Service Tax - Goods Transport Agency . Query

[Ashok Chopra]

Dear Sir,

I have received GTA service for Rs. 13,56,384/- during September, 2012 to March, 2013.
Without availing abatement i debited 12.36 percent service tax in CENVAT Register, which comes to Rs. 167649/-
Audit Party taken objection and asked me to deposit entire amount of Rs. 167649/- through Challan
My contention is I was entitle was abatement of 75 percent and if i would have taken benefit of abatement my liability was at the rate of 3.09 percent which comes to Rs. 41913.00.
I deposited Rs. 41913/- alongwith upto date interest Rs. 7985/- through Challan.
Now the objection of Audit party is I have shown entire amount i.e. Rs. 167649/- in ST-3, hence no abatement is applicable to me and i am being forced by them to deposit balance amount of Rs. 125736/- alongwith interest through Challan.
Please guide accordingly, if possible please provide me any citation/notification/clarification etc. in this regard.

Thanks and regard

Ashok Chopra

[Guest]

Abatement can be taken only if GTA has not taken Cenvat credit of input, input service and capital goods. It can be ensured by taking declaration from GTA on letterhead or declaration on consignment note/invoice. If it can be established, then you are entitled to take abatement. You can take a ground that the value was shown without abatement in the ST-3 inadvertently. It was a clerical mistake.  

[Guest]

Good eve.mr.choudhry,If an assasee not taking credit of input services but taking the cenvet credit of excise duty of input (raw material)than could he is eligible to get abatement on service tax.

[Pravin Shelke]

ANS.

GTA 75 percent ABATEMENT NOTIFICATION NO   026/2012-ST. SR NO 7 

AND EXEMPTION NOTIFICATION NO  030/2012-S.T. SR 2

REGARDS 

PRAVIN SHELKE

[Rajesh Nathoo]

Dear Ashok , It is not a very big issue, u can convince the Audit party by submitted proper proof - How much transportation charges u have incurred for said period , Cosignment Notes, Trial balance for the said period , etc. Only thing u have to prove that u have incurred only Rs 13,56,384/- as Transportation expense , rest is a clerical mistake .

AI Summary

GTA abatement entitlement available only if supplier hasn't taken CENVAT credit; require declarations and consignment proof. Entitlement to the GTA 75 percent abatement requires that the GTA has not availed CENVAT credit of inputs, input services, or capital goods, demonstrated by a supplier declaration on letterhead or consignment note/invoice. If such proof exists, the taxable value should reflect the abatement rather than full gross receipts. Showing the full value in ST 3 may be a clerical mistake that can be corrected by producing consignment notes, trial balance entries and supplier declarations to substantiate the abated liability and limit tax and interest exposure.