service tax on freight outward

[Anil Jangid]

Dear sir,

We prepare our excise invoice as below for example

ass. value ex. factory 50000

central excise concessional rate 2% 1000

Total 51000

cst 2% 1020

freight recovery 2000

Total 54020

We are not include freight in assesable value due to ex. factory sale price ,show separately in excise invoice.. while calculate excise duty.we are pay freight on behalf of consignee.and show freight recovery.in excise invoice.

Transporter raise bill to us therefor we are liable to pay freight outward or consignee liable to pay.now my question who will pay service tax consignee or consignor.under reverse mechanism under gta. please reply.

[SHIVKUMAR SHARMA]

Dear Anil

In this case you have to pay service tax because you have make the freight payment to the transporter.

SHIVKUMAR SHARMA

[KASTURI SETHI]

Service Tax law is very much clear who pays the freight will pay Service Tax under GTA.

[Ganeshan Kalyani]

Yes I agree with the reply submitted by Kasturi Sir.

AI Summary

GTA reverse charge: the party who pays the transporter for freight is liable to discharge the service tax. Under the GTA reverse charge mechanism, the party who pays the transporter for freight is liable to pay service tax; if the consignor pays the carrier and later recovers freight from the consignee, the consignor remains obligated to discharge the service tax because it made the payment to the transporter.