who should pay Service tax in case of renting a building to bank

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  1. johnsmith1987

    johnsmith1987 New Member

    I am constructing a building for bank with currency chest. I want to know who has to pay service tax, me or the bank . please while answering provide me with some ruling or act from government so that I can show the bank.
    As they pretend to be very clever
     
  2. Parul_Gupta

    Parul_Gupta Active Member

    The Service Tax is always paid by the person who has taken the building on Rent.

    This is a generally accepted principle and all banks pay service tax on rent. There is nothing in this which they won't agree with.
     
  3. johnsmith1987

    johnsmith1987 New Member

    I get your point but if there is some ruling or act or anything official supporting your above statement it will be of great help. thank you
     
  4. deepak99

    deepak99 New Member

    If the question is of works contract, You will have to pay 50 % of service tax under reverse charge mechanism ,if you are IND/Firm/AOP/HUF.Consider NN 15/2012-ST dated 17.03.2012.
     
  5. johnsmith1987

    johnsmith1987 New Member

    Sir
    Sorry I didnt understand your statement. Can you please ellaborate.
     
  6. johnsmith1987

    johnsmith1987 New Member

    I think I get your point . Mam I am the landlord in this case and want to know about the service tax
     
  7. deepak99

    deepak99 New Member

    Sir
    You will pay the service tax to govt.
    Suppose rent is 20000/- p.m, You will raise a bill of 20000 + 2460(12.36%) = 22460. You are the service provider & its your liability to deposit service tax.
     
  8. johnsmith1987

    johnsmith1987 New Member

    Sir
    You are saying that I have to pay service tax ok fine but can this be charged to bank beside the rent because like in restaurants and hotels they collect service tax after the bill and then pay to the concerned authority .
     
  9. deepak99

    deepak99 New Member

    definitely sir
    you will charge this from your bank
     
  10. johnsmith1987

    johnsmith1987 New Member

    Sir
    That's I wanted to know. Now coming to legalities of your above statement can you provide me with some kind of ruling or act by service tax dept stating your mentioned facts so that I can show the bank that they have pay me beside the monthly rent.
     
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