SERVICE TAX BILL CANCELLED IN NEXT QTR

[d.v. gupta]

SIR,

WE ARE A PLACEMENT AGENCY . WE HAVE RAISED THE BILLS IN APRIL QTR FOR SERVICES AND PAID THE SERVICE TAX. THE PAYMENT OF BILLS NOT RECEIVED AS THE CANDIDATES LEFT THE JOB BEFOR 30 DAYS. AS WE HAVE PAID SERVICE TAX ON THOSE BILLS , HOW WE SHOULD ADJUST THE SERVICE TAX IN NEXT QTR OR WE SHOULD FORGET THE SERVICE TAX ON BILLS WHICH COULD NOT BE REALISED.

AI Summary

Placement Agency Seeks Service Tax Adjustment for Non-Completed Services; Clarification on Billing Timing and Adjustment Rules A placement agency raised bills and paid service tax for services in the April quarter, but the candidates left their jobs before 30 days, and the payments were not received. The agency inquired about adjusting the paid service tax in the next quarter. One response explained that since March 2007, excess service tax paid can be adjusted against future liabilities. Another response agreed but noted that the service is considered complete only after the candidate completes the agreed period, suggesting bills should be raised only when entitled to service charges.