Service tax on Previous year bills

[Sanjeev Sharma]

A chartered accountant firm having gross receipts more than Rs. 50 lacs is maintaining accounts on cash basis. Whether differential service tax ( 12.36% minus 10.3%) on bills raised upto 31^st March, 2012 and payments received subsequently in April, May, June and July, 2012,  is to be paid ??

AI Summary

Service Tax Rate Dispute: Delhi Court Stays Higher Rate on Pre-April 2012 Invoices Paid Afterward A chartered accountant firm inquired about the applicable service tax rate on payments received after April 1, 2012, for invoices issued before that date. Initially, the service tax rate was increased to 12.36% from 10.3% starting April 1, 2012, as per a government circular. However, the Delhi High Court stayed the collection of the differential service tax on certain professional services, including those provided by chartered accountants, where invoices were issued before April 1, 2012, but payments were received afterward. The stay was in response to a petition by the Delhi Chartered Accountants Society, suggesting that further clarification or legal action might be necessary for similar cases.