In India, the burden of paying service tax lies with the consumer. If you are a consumer of services, then your service provider will charge you service tax on the bill amount. He will pass this service tax collected from you on to the Government.
Let’s say you went to a drycleaner to get your blazer dry-cleaned. You get a receipt that looks some what like the one shown below:
ABC Dry cleaners Date: 12/08/2016
Billing Address: STC No.: AZTRD0746AXXX12
Shop No. 1, Vijay Nagar, Delhi PAN No.: AZTRD0746A
Invoice No. 999
| S.No | Description | Amount (In Rs.) |
| 1. | Blazer | 500 |
| Add: Taxes | Service Tax@15% | 75 |
| Total Amount Payable | 575 |
Now if you notice, the bill amount is INR 500 for one blazer. Service tax @ 15% has been charged on that amount and the total amount that you are liable to pay is INR 575. Out of this INR 500 will go the drycleaner’s pocket and INR 75 will go to the Government.
Why Do I need to be concernedwith it?
You need to be concerned with it because the service tax that is paid to the Govt. is being collected from your hard-earned money.
This is the part where you need to be very careful. How do you know that the service tax charged from you by the drycleaner has been passed on by him to the Govt.?
There have been many instances where service providers were not even registered under Service Tax Act, but were collecting service tax from their customers and instead of paying it to the Govt., they were paying it to themselves. i.e. they were pocketing the service tax amount fraudulently. Such service providers usually provide a fake service tax registration number on their invoice to fool the customer.
If you have been charged service tax on services provided by any such bogus service provider, your money has just fallen into wrong hands.
I don’t want my Money to go to Waste!
It is perfectly understandable. No one does. You pay taxes from your hard—earned money and the tax you pay contributes to our national treasury. But when frauds like this happen, you feel helpless and frustrated both at having been fooled as well as at the loss of your money.
Don’t fret. It is very easy to determine whether your service provider is fooling you or not. Read on to know how.
Let’s go Step by Step
The Central Board of Excise & Custome (CBEC) has made it very easy to verify the genuineness of a service provider. It is a very easy 3 step process which can be done by anyone, even if he has no knowledge of taxes and related matters.
Step 1: Go the following link
This is a direct link to the verification page of CBEC’s website. This saves you the time and energy that you would have otherwise spent navigating through their website.
Step 2: Enter the Assessee Code in the Box Shown
An assessee code is a 15-character identification number issued by the CBEC to a registered service provider. It is based on service provider’s PAN number but in some cases it can be based on a temporarily issued number as well. Simply put, it is the service tax registration number of your service provider.
Please bear in mind that assessee code, registration number, ECC and STC are one and the same and you do not have to get confused because of so many different names.
The assessee code/STC of a service provider is mentioned on the registration certificate issued to him and also on the invoice. It is mandatory for a registered service provider to mention his STC on the invoice issued by him.
When you have the assessee code with you, enter it into the box that will appear when you go to the above link.
Step 3: Getting the Information
Once you have the entered the assessee code in the appropriate box, you need to enter the CAPTCHA image in the box below it and press “Get Details”.
If the assessee code entered is genuine, the following information will appear on the screen.
- Assessee name
- Address
- Location Code
If this information matches with the details of your service provider, you know he is genuine and your money is reaching the Govt.
If the information generated does not match with that of your service provider or if no information is generated because of an incorrect/invalid assessee code, you can contact your service provider and ask him to prove his registration or to refund the tax collected from you.
You can also report this matter to the local tax authorities and they will take appropriate action against such service provider, including recovery of fraudulently collected tax.
Author: This blog is written by Ms. Pragya Chaturvedi, student of Faculty of Law, University of Delhi , a passionate blogger & intern at Aapka Consultant.
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