Claim of service tax prior to registration

[Guest]

Service under construction service contractor is doing civil work. While doing contractor does not have service tax registration. After getting service tax registration contractor can claime service tax for period of before registration period. More detail is given here. Contractor has work for the period between 01.01.07 to 30.06.07. Service tax registration certificate availed on 20.09.07. Contractor reaised service tax invoice on 01.01.08. Can we paid service tax?. Also note that we had paid service tax returns up to 31.12.07.

[Madhukar N Hiregange]

It looks like there are compsoit\e indivisible civil contracts. If so for services provided upto 1.6.2007 there is no liability. Raising of the invoice is not important if it can be established that the work was done earlier. Assuming that the job was of labour ( or divisible contract)then the ST for the past period can be paid after availing the credits if any. Intrest @ 13% annum would be applicable.

AI Summary

Service tax liability depends on whether construction contracts are composite or divisible; payment and interest consequences follow accordingly. Service tax for construction work turns on whether the contract is composite and indivisible-in which case services performed before the specified date do not attract liability-or a divisible/labour contract, in which case tax for the pre-registration period may be paid after registration with adjustment for eligible input credits; interest for delayed payment is applicable and invoice date is immaterial if earlier work is established.