Circular No. 158/9/ 2012 – ST
F.No 354/69/2012- TRU
Government
of India
Ministry
of Finance
Department
of Revenue
Central
Board of Excise and Customs
Tax
Research Unit
Room No
146, North Block, New Delhi
Dated : 8th May 2012
To
Chief
Commissioner of Customs and Central Excise (All)
Chief
Commissioner of Central Excise & Service Tax (All)
Director
General of Service Tax
Director
General of Central Excise Intelligence
Director
General of Audit
Commissioner
of Customs and Central Excise (All)
Commissioner
of Central Excise and Service Tax (All)
Commissioner
of Service Tax (All)
Madam/Sir,
Subject: - Clarification on Rate of Tax - regarding.
1.
The rate
of service tax has been restored to 12% w.e.f. 1st April 2012. Representations have been
received requesting clarification on the rate of tax applicable wherein
invoices were raised before 1st April 2012 and the payments shall be
after 1st April 2012. Clarification has been requested in case of
the 8 specified services provided by individuals
or proprietary firms or partnership firms, to which Rule 7 of Point of
Taxation Rules 2011 was applicable and services on which tax is paid under
reverse charge.
2.
The rate
of service tax prevalent on the date when the point of taxation occurs is rate
of service tax applicable on any taxable service. In case
of the 8 specified services and services
wherein tax is required to be paid on reverse charge by the service receiver the
point of taxation is the date of payment. Circular No 154/5/2012
– ST dated 28th March 2012 has also clarified the same. Thus in case of such 8 specified services provided
by individuals or proprietary firms or
partnership firms and in case of services wherein tax is required to be paid on
reverse charge by the service receiver, if the payment is received or made, as
the case maybe, on or after 1st April 2012, the service tax needs to
be paid @12%.
3.
The
invoices issued before 1st April 2012 may reflect the previous rate
of tax (10% and cess). In case of need, supplementary invoices may be issued to
reflect the new rate of tax (12% and cess) and recover the differential amount.
In case of reverse charge the service receiver pays the tax and takes the
credit on the basis of the tax payment challan. Cenvat credit can be availed on
such supplementary invoices and tax payment challans,
subject to other restrictions and conditions as provided in the Cenvat Credit
Rules 2004.
4.
Trade
Notice/Public Notice may be issued to the field formations accordingly.
5.
Please
acknowledge the receipt of this circular. Hindi version to follow.
(Dr. Shobhit Jain)
OSD, TRU
Fax:
011-23093037