payment of service tax

[BAL KRISHAN GARG]

Deal All ,

I have a query that one of my client is providing bus to a company for its employees from different places in delhi to company office by picking and dropping them and charging service tax from the company and paying the same to the Department on quarterly basis . now the company asking him not to charge service tax on the invoice value but asking him to raise the invoice without service tax saying that we will pay the service tax on your bill you need not to include the amount of service tax in the invoice .

Whether the company is right and what should i do ?  if the company is right then whether what procedure we have to follow at the time of filing of Service Tax Return on Half-yearly basis ?

Hope some gentlement will clarify the matter .

 

Thanks to all Members

BAL KRISHAN GARG

AI Summary

Reverse charge: service recipient pays part of service tax on abated value while provider accounts for the balance.
Under the reverse charge mechanism for employee transport services the tax incidence is split on the abated taxable value: the service recipient pays tax on forty percent of the abated value and the service provider pays tax on the remaining sixty percent; if the provider is not availing Cenvat credit it need not charge service tax but should quantify and show the tax as payable by the recipient.