Service tax on Income tax deducted at source, Service Tax

[Mukund Honkan]

Service tax earlier to recent budget presented in Feb 2011 was payable on actual receipt from vendors. If vendor has deducted TDS but not paid balance amount, whether one should deposit services tax on TDS amount. Regards, Mukund M Honkan

Posts / Replies

[CA Rachit Agarwal]

Yes. Service Tax will be paid on the TDS amount.

The person deducting the tax has paid the amount to you indirectly. He has deposited the tax for which credit would be availed by you.

Hence Service tax woule be applicable on the gross amount (Amount received plus the tds)

 

[Mukund Honkan]

Thanks for feedback. Are there any relevant case laws thanks Mukund M Honkan