SBC WRONGLY DEPOSITED , NOW ??

[abbas mukhi]

DEAR SIR,

WETHER SBC WAS APPLICABLE IN CASES WHERE SERVICE PROVIDED BEFORE 15.11.2015.

WE HAVE COLLECTED & DEPOSITED SBC IN CASES WHERE SERVICES WAS PROVIDED BEFORE 15.11.2015 AND INVOICE IS ISSUED AFTER 29.11.2015. WHETHER WE WENT WRONG ??

IS THERE ANY REMEDY FOR REVISING THE SITUATION ??

[DR.MARIAPPAN GOVINDARAJAN]

Services were provided before 15.11.2015;

Invoice was issued after 29.11.2015;

When the payment has been received?

[abbas mukhi]

Sir,

Party before 15.11 and partly after 15.11

[abbas mukhi]

Sir,

We were confused between applicability of Rule 4 or Rule 5 of Point of Taxation rules

[Rajagopalan Ranganathan]

Sir,

In my opinion you are liable to pay SBC since you had issued invoice after 29.11.2015 since rule 5 (b) of Point of Taxation of Service rules, 2011 stipulates that "no tax shall be payable if the payment has been received before the service becomes taxable and invoice has been issued within fourteen days of the date when the service is taxed for the first time, that is, on or before 29.11.2015.

[KASTURI SETHI]

Since you have crossed the last date i.e. 29.11.2015, the date of invoice. SBC has been rightly paid. No remedy required. There is no provision for hybrid procedure.

[Ganeshan Kalyani]

I agree with the views submitted by the experts above.

[abbas mukhi]

Thanks dear experts, whether the rate of 14.5 would applicable even if service provided before 01.06.2015 (when rate was 12.36) and invoice today..Thanks once again

[Ganeshan Kalyani]

As asked my Mariappan Sir, Please mention when you have received payment.

[abbas mukhi]

Sir,

Payment received before 01.06.2015 (when service tax was 12.36%)

Whether rate in that would be 12.36+0.50 (as the invoice issued after 29.11.2015) ???

[DR.MARIAPPAN GOVINDARAJAN]

Services have been rendered before 15.11.2015; Part payment has been received during June 2015; and invoice has been issued after 29.11.2015. SBC is definitely applicable to your case. You have correctly paid SBC.

[Ganeshan Kalyani]

Sir, the queriest has mentioned that service was provided before June 2015 and part payment too received before June 2015 and only invoice is raised after 29.11.2015. In such scenario whether 12.36% will apply.

AI Summary

SBC applicability affirmed where invoices issued after tax activation date, requiring SBC payment despite earlier service provision.
Issuance of invoice after the date the service first became taxable creates SBC liability under the Point of Taxation Rule; earlier service performance or part payment does not negate SBC where invoice is issued after that cutoff. Payment timing is a relevant factual element but experts concluded SBC was rightly deposited in the reported scenario. The discussion left open the related question of which service tax rate applies when services and payments predate rate changes but invoicing follows the new tax activation.