SIR,
ONE OF THE ASSESSEE ( HIGH WAYS CONTRACTOR) ENTERED INTO AN AGREEMENT WITH GEOLOGY AND MINING DEPARTMENT FOR ROAD LAYING STONES. FOR THIS, THE ASSESSEE HAS NOT PAID REVERSE CHARGE MECHANISM UNDER SERVICE TAX. NOW THE DEPARTMENT DGGI HAS ISSUED AN SCN AND ASKED TO PAY THE SERVICE TAX FROM 2016-17 & 2017-18.
KINDLY ADVICE, WHETHER HE HAS TO PAY THE TAX OR ANY OTHER RELIEF
Contractor Faces Contentious Service Tax Demand on Royalties Under Reverse Charge Mechanism for 2016-18; Legal Challenges Possible A highway contractor engaged with a state geology and mining department for road construction materials has not paid the reverse charge mechanism (RCM) service tax on royalties for 2016-17 and 2017-18. The department issued a show cause notice (SCN) demanding the tax. The contractor seeks advice on whether RCM applies to royalties paid to the government. Responses suggest that the issue is contentious, with industry challenging the levy. Options include paying under protest or contesting the validity. The discussion highlights the complexities of service tax on royalties and potential legal challenges. (AI Summary)
TaxTMI 
TaxTMI 
TaxTMI 
