We are traders of medical equipment in Delhi and Maharashtra. We pay our VAT/CST dues on a monthly basis in Maharashtra. For October 2013, payment of the Central Sales Tax was inadvertently made under a wrong TIN, thereby reflecting a TIN of another dealer in the CST challan. Kindly advise whether we need to pay the CST again and seek a refund from the VAT department later on the wrong payment.
Recently, vide Trade Circular No.7T dated November 22 issued by the Maharashtra Sales Tax Authorities, various issues relating to correction of mistakes by dealers in payment of taxes have been clarified. As per the circular, in case a payment of taxes has been made by the dealer inadvertently under a wrong TIN, then an application needs to be filed with the concerned deputy commissioner of sales tax (returns and recovery branch) along with a photocopy of the relevant challan and a No Objection Certificate (NOC) in a prescribed format from the dealer whose TIN has been incorrectly mentioned. Accordingly, you should follow the procedure laid down under the circular for correcting the mistake. No need to pay the CST again.
Service tax liability under VCES
We are a Gurgaon-based real estate company and are in the business of renting out commercial property. In January 2013, we had received a notice from the service tax authorities seeking details of the rental income of the last three years. During the statutory audit for FY12-13, we have been informed by our auditors that appropriate service tax has not been discharged by us under the partial reverse charge mechanism in respect of the various works contract services availed of by us from individual works contractors during FY12-13. Kindly advise whether we can make a disclosure under the Voluntary Compliance Encouragement Scheme (VCES) and pay our correct service tax liability under partial reverse charge?
As per the VCES, any person who has not fully discharged his service tax liability for the period October 2007 to December 2012 may avail of the scheme. Upon fulfillment of all the prescribed conditions, the interest, penalty and other penal consequences shall be waived. One of the conditions for availing of the benefit under the VCES scheme is that no inquiry/investigation should be pending as on March 1, 2013.
As per the Circular No. 174/9/2013?ST dated November 25 issued by the CBEC, it has been clarified that if an inquiry or investigation, pending as on March 1 in respect of a specific issue, then the benefit of VCES would be eligible in respect of ?tax dues? concerning any other issue in respect of which no inquiry or investigation was pending as on March 1.
In the light of the above circular, since no inquiry was pending as on March 1, in respect of your service tax liability under the partial reverse charge, the benefit of VCES may be availed of by making a true disclosure and paying the service tax dues.
Canteen services exempted from tax
We are in the business of manufacturing plastic products from our factory based out of Bangalore. We have installed an air-conditioner facility to the existing canteen facility which caters to our employees. We understand that the services provided to a person by a restaurant, having the facility of air-conditioning, have been brought under the ambit of service tax. Please advise on the applicability of service tax on the canteen maintained in the factory.
Services provided in relation to serving food or beverages by a canteen maintained in a factory covered under the Factory Act,1948 having the facility of air-conditioning at any time during the year have been specifically exempted from the levy of service tax, vide Notification 14/2013 dated October 22. Hence, the no service tax would be applicable on the canteen services provided by you to your employees.
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