Liability for service tax - GTA

[RadheyShyam Mangal]

A Company has purchased certain inputs. The Seller, being a no specified person, had paid the frieght to the Goods Trasport Agency and then claimed reimbursement from the said Buyer Comapany.Upto this stage service tax was neither paid by the seller consigner nor by the GTA . Now, whether such Buyer Company is liable to pay Service Tax for GTA Services as recepient of service when frieght payment was made by the seller Consigner to the GTA, then claimed as reimbursement from the buyer Company. If yes, is such Buyer Company eligible for Cenvat?

[Rama Krishana]

In this case, if you consider that buyer company has paid the amount to transporter through the seller (individual) and for this purpose, such seller has acted as his agent, the company can pay service tax on such GTA and claim the benefit of cenvat credit paid on such GTA as inward transportation.

AI Summary

Buyer Company Liable for Service Tax on GTA Services if Seller Acts as Agent; Cenvat Credit Applicable A company purchased inputs, with the seller paying freight to a Goods Transport Agency (GTA) and seeking reimbursement from the buyer company. The issue raised was whether the buyer company is liable for service tax on GTA services as the recipient, given that the seller initially paid the freight. The response indicated that if the seller acted as an agent for the buyer, the buyer company can pay the service tax on the GTA and claim Cenvat credit for the inward transportation.