Point of Taxation for Service Tax as Per Budget 2011-12`
As per the NT # 18 /2011- Service Tax, the taxation point has been changed from Cash basis to accrual basis. But if we see the Rule 7 of Cenvat Credit Rules 2004, it says that " The input service distributor may distribute the CENVAT credit in respect of the service tax paid on the input service to its manufacturing units or units providing output service.
This rules conflicts with the provisions of NT # 18/2011- of Service Tax of accrual basis. . In case of O2C cycle, liability is incurred at the time of invoicing or receipt or rendering of service whichever is earlier. There is difference in case of P2P cycles only.
This rules conflicts with the provisions of NT # 18/2011- of Service Tax of accrual basis. . In case of O2C cycle, liability is incurred at the time of invoicing or receipt or rendering of service whichever is earlier. There is difference in case of P2P cycles only.
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