SERVICE TAX SWACHH BHARA CESS TO BE INTRODUCED FROM 15 NOVEMBER 2015 AT 0.5%

Ministry of Finance Department of Revenue Central Board of Excise and Customs (CBEC)  has issued the Notification for date and rate of Swachh Bharat Cess from 15th November 2015 at .5% on value of taxable services. So from 15th Nov 2015 Service Provider has to charge 14% Service Tax and .5% Swachh Bharat Cess on value of taxable services

[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(DEPARTMENT OF REVENUE)

New Delhi, the 6th November, 2015

 

Notification No. 22/2015-Service Tax

G.S.R. —(E).- In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) read with sub-section (5) of section 119 of the Finance Act, 2015 (20 of 2015), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts all taxable services from payment of such amount of the Swachh Bharat Cess leviable under sub-section (2) of section 119 of the said Act, which is in excess of Swachh Bharat Cess calculated at the rate of 0.5 percent. of the value of taxable services:

Provided that Swachh Bharat Cess shall not be leviable on services which are exempt from service tax by a notification issued under sub-section (1) of section 93 of the Finance Act, 1994 or otherwise not leviable to service tax under section 66B of the Finance Act, 1994.

This notification shall come into force from the 15th day of November, 2015.

 

Process for Issue of Summons in Central Excise and Service Tax

Central Board of Excise and Customs (CBEC) has issued the guidelines on 20th January 2015 through circular No. 207/07/2014-CX-6 for issue of summons in Central Excise and Service Tax matters. As per Section 14 of Central Excise Act, 1944, summons can be used in an inquiry for recording statements or for collecting evidence/ documents. Summons can be issued by  Superintendents or higher authority but only after taking prior permission of  Assistant Commissioner or higher authority with reasons of summons recorded in writing. In case not able get written permission then telephonic permission is required & same should be reduced to writing and intimated to the officer.  The officer issuing summons should submit a report or should record a brief of the proceedings in the case file and submit the same to the  officer who had authorised the issue of summons. senior management officials such as CEO, CFO, General Managers of a large company or a PSU should not generally be issued summons at the first instance. They should be summoned only when there are indications in the investigation of their involvement in the decision making process which led to loss of revenue. Instruction has also been issued vide F. No. 137/39/2007-CX.4 dated 26.2.2007 in Service Tax matters. Board has already issued a circular vide F. No 208/122/89-CX.6 dated 13.10.1989 in respect of Central Excise

 

No. 207/07/2014-CX-6

Government of India

Ministry of Finance

Department of Revenue

Central Board of Excise and Customs

  New Delhi, the 20th January, 2015

 

To

 

Principal Chief / Chief Commissioners of Central Excise (All),

Principal Chief / Chief Commissioners of Central Excise of Central Excise & Service Tax (All),

Sub: Instructions regarding issue of summons in Central Excise and Service Tax matters – reg.

Madam/Sir,

It has been brought to the notice of the Board that in some instances, the summons under Section 14 of the Central Excise Act, 1944 have been issued by the field formations to the top senior officials of the companies in a routine manner to call for material evidence/ documents. Besides, summons have been issued to enforce recovery of dues, which are under dispute. As per Section 14 of Central Excise Act, 1944, summons can be used in an inquiry for recording statements or for collecting evidence/ documents. While the evidentiary value of securing documentary and oral evidence under the said legal provision can hardly be over emphasized, nevertheless, it is desirable that summons need not always be issued when a simple letter, politely worded, can also serve the purpose of securing documents relevant to investigation. It is emphasized that the use of summons be made only as a last resort when it is absolutely required.

On this issue, Board has already issued a circular vide F. No 208/122/89-CX.6 dated 13.10.1989 in respect of Central Excise. Instruction has also been issued vide F. No. 137/39/2007-CX.4 dated 26.2.2007 in Service Tax matters.

The following guidelines are being issued to be followed in both Central Excise and Service Tax matters:–

 

(i) Power to issue summons are generally exercised by Superintendents, though higher officers also issue summons. Summons by Superintendents should be issued after obtaining prior written permission from an officer not below the rank of Assistant Commissioner with the reasons for issuance of summons to be recorded in writing;

(ii) where for operational reasons it is not possible to obtain such prior written permission, oral/telephonic permission from such officer must be obtained and the same should be reduced to writing and intimated to the officer according such permission at the earliest opportunity;

(iii) In all cases, where summons are issued, the officer issuing summons should submit a report or should record a brief of the proceedings in the case file and submit the same to the  officer who had authorised the issue of summons.

Further, senior management officials such as CEO, CFO, General Managers of a large company or a PSU should not generally be issued summons at the first instance. They should be summoned only when there are indications in the investigation of their involvement in the decision making process which led to loss of revenue.

These instructions may be brought to the notice of all the field officers for strict compliance. Non observance of the instructions will be viewed seriously. Hindi version would follow.

 

 

Yours faithfully,

 

(ROHAN)

Under Secretary, (CX-6)

Last Date for Service Tax Return for Half Year Ending 31 March 2015 (For Oct 2014 to March 2015)

Service Tax Return (ST-3)  for the half year  ending 31st March 2015 i.e. for period starting from October 2014 to March 2015 has been made available for e-filing by the assesses in both offline and  online version in ACES w.e.f 1st April, 2015. The last date of filing the ST-3 return for the said period is 25th April, 2015. Penalty for late filling is Rs 20,000/-

Service Provider can download the latest ST 3 Service Tax Half Yearly return for online filing of Service Tax return.  In case of any difficulty in accessing the ACES Application or in filing ST 3 returns, the assesses can seek help of the ACES Service Desk by sending e-mail to aces.servicedesk@icegate.gov.in or calling up national toll-free number 1800 425 4251.

Service Tax Return (ST-3) for the period from Oct’ 14 to March’15  is now  available for e-filing by the assesses. The last date for filing the returns for the said period is 25th April, 2015. The assesses can file return online or use the offline utility by downloading the latest version. Assessees are requested to file their returns in ACES well in advance to avoid rush and inconvenience at the last moment.

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New Service Tax Rate 14% +2% i.e. 12.36% to 14%+2% =16% New Effective Date and Rate

Ministry of Finance of has issued the clarification related to the applicability of the new service tax rate of 14%+2%(Swachh Bharat Tax) total of 16% and as per the circular new rate and its applicable date will be notified by the government after the enactment of the Finance Bill, 2015 i.e. after budget is passed by the parliament and assented by the President of India and possible date will be between 20th April to 25th April 2015 till then current rate of 12.36% will be applicable.

Circular No. 183 / 02 / 2015-ST

F. No. B-1 /1/2015-TRU
Government of India
Ministry of Finance
Department of Revenue
(Tax Research Unit)

***

Room No. 153, North Block, New Delhi.

Dated 10th April, 2015.

To
Chief Commissioner of Customs and Central Excise(All)
Chief Commissioner of Central Excise & Service Tax (All)
Director General of Service Tax
Director General of Central Excise Intelligence
Director General of Audit Commissioner of Customs and Central Excise (All)
Commissioner of Central Excise and Service Tax (All)
Commissioner of Service Tax (All) Madam/Sir,

Dear Madam/Sir,

Subject: Clarification on rate of service tax – regarding.

Doubts have been expressed in various forums regarding the proposed increase in the rate of service tax from 12.36% (including education cesses) to 14% on the value of taxable service.

2.         It may be noted that changes proposed in the Budget have/are coming into effect on various dates as already indicated in JS (TRU-II) D.O. letter dated 28th February, 2015. Certain amendments made in the Finance Act, 1994, including the change in service tax rate, will come into effect from a date to be notified by the Government after the enactment of the Finance Bill, 2015.

 3.        In this regard your attention is invited to clause 106 of the Finance Bill, 2015 and paragraph 3 of JS (TRU-II) D.O. letter, which  is reproduced below:-

“3. Service Tax Rate:

3.1       The rate of Service Tax is being increased from 12% plus Education Cesses to 14%. The ‘Education Cess’ and ‘Secondary and Higher Education Cess’ shall be subsumed in the revised rate of Service Tax. Thus, the effective increase in Service Tax rate will be from the existing rate of 12.36% (inclusive of cesses) to 14%, subsuming the cesses.

3.2       In this context, an amendment is being made in section 66B of the Finance Act, 1994. Further, it has been provided vide clauses 179 and 187 respectively of the Finance Bill, 2015 that sections 95 of the Finance Act, 2004 and 140 of the Finance Act, 2007, levying Education Cess and Secondary and Higher Education Cess on taxable services shall cease to have effect from a date to be notified by the Government.

3.3       The new Service Tax rate shall come into effect from a date to be notified by the Central Government after the enactment of the Finance Bill, 2015.

3.4       Till the time the revised rate comes into effect, the ‘Education Cess’ and ‘Secondary and Higher Education Cess’ will continue to be levied in Service Tax.”

4.         The paragraph reproduced above is self-explanatory and it is clear that the new Service Tax rate shall come into effect from a date to be notified by the Central Government after the enactment of the Finance Bill, 2015. The date will be notified in due course after the enactment.

5.         Similarly, certain doubts have been raised with regard to abatement on value of services provided in relation to serving of food or beverages by a restaurant, eating joint or a mess, having the facility of air-conditioning or central air-heating in any part of the establishment, at any time during the year. Valuation of services provided in relation to serving of food or beverages by a restaurant, eating joint or a mess is determined as provided in rule 2C of the Service Tax (Determination of Value) Rules, 2006.

5.1       In the Union Budget, 2015, no change has been made in these rules; therefore, any confusion is unwarranted. Further, as explained above, the rate of service tax on the specified portion of the amount charged for such supply which is 40% continues to be 12.36% (includingcesses) at present i.e. 4.944 %. The rate of Service tax, as discussed above, will continue unchanged till a date which will be notified in due course.

6.         Wide publicity may be given so that the assesses and public are aware of the above.  All the major Industry/Trade Associations may be informed accordingly.

 

Yours sincerely,

(Dr. Abhishek Chandra Gupta)

Technical Officer, TRU

Tel: 011-23095547

Download Half Yearly Service Tax Return from Oct to March 2013: Due Date 10th Sept 2013

Download Half Yearly Service Tax Return from Oct to March 2013. CBEC has declared the due date for filing half service tax return for period ending 31st March 2013. Due date for half yearly service tax return has been extended from 25th April to 31st August 2013 and again extended to 10th Sept 2013. Service Tax ST-3 Form for half yearly service tax return is released on 31st July 2013.

Download Half Yearly Service Tax Return from Oct to March 2013

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Due Date for Half Year Service Tax Return from Oct to March 2013

CBEC has declared the due date for filing half service tax return for period ending 31st March 2013. Due date for half yearly service tax return has been extended from 25th April to 31st August 2013. Service Tax ST-3 Form for half yearly service tax return is expected to be released on 31st July 2013. Due date for Half Year ending 30th Sept 2013 i.e. 1st April 2013 to 30th September is 25th October 2013.

Due Date for Service Tax Half Yearly Return for period

  • 1st April to 30th September : 25th October
  • 1st October to 31st March: 25th April

Service Tax Order No: 03/2013 Dated 23rd April 2013

In exercise of the powers conferred by sub-rule(4) of rule 7 of the Service Tax Rules, 1994, the Central Board of Excise & Customs hereby extends the date of submission of the  Form ST-3, for the period from 1stOctober 2012 to 31st March 2013, from 25th April, 2013 to  31st August, 2013.

The circumstances of a special nature, which have given rise to this extension of time, are as follows:

“The Form ST-3, for the period from 1st October 2012 to 31st March 2013, is expected to be available on ACES around 31st of July, 2013”

Now Available: Download Half Yearly Service Tax Return Oct to March 2013

Service Tax on Erection/Laying of Pandal and Shamiana

Service tax will be charged on the activity of preparation of place for organizing event or function by way of erection/laying of pandal and shamiana

Service Tax Circular No. 168/3 /2013 dated 15th April, 2013 

Subject:  Tax on service provided by way of erection of pandal or shamiana – regarding.

Several representations have been received seeking clarification on the levy of service tax on the activity of preparation of place for organizing event or function by way of erection/laying of pandal and shamiana. The doubt that has been raised is that this may be a transaction involving “transfer of right to use goods” and hence deemed sale.

 2.  The issue has been examined. “Service” defined in section 65B (44) of the Finance Act, 1994, includes a ‘declared service’.  Activity by way of erection of pandal or shamiana is a declared service, under section 66E 8(f). The process of erection of Pandal or shamiana is a reasonably specialized job and is carried out by the supplier with the help of his own labour. In addition to the erection of pandal or shamiana the service is generally coupled with other services like supply of crockery, furniture, sound system, lighting arrangements, etc.

 3.  For a transaction to be regarded as “transfer of right to use goods”, the transfer has to be coupled with possession. Andhra Pradesh High Court in the case of Rashtriya Ispat Nigam Ltd. Vs. CTO [1990 77 STC 182] held that since the effective control and possession was with the supplier, there is no transfer of right to use. This decision of the Andhra Pradesh High Court was upheld by the Supreme Court subsequently [2002] 126 STC 0114. In the matter of Harbans Lal vs. State of Haryana – [1993] 088 STC 0357 [Punjab and Haryana High Court], a view was taken that if pandalis given to the customers for use only after having been erected,  then it is not transfer of right to use goods.

 4. In the case of BSNL Vs. UOI [2006] 3 STT 245 Hon’ble Supreme Court held that  to constitute the transaction for the transfer of the right to use the goods, the transaction must have the following attributes:-

  1. There must be goods available for delivery;
  2. There must be a consensus ad idem as to the identity of the goods;
  3. The transferee should have a legal right to use the goods and, consequently, all legal consequences of such use including any permissions or licenses required therefor should be available to the transferee;
  4. For the period during which the transferee has such legal right, it has to be the exclusion of the transferor : this is the  necessary concomitant or the plain language of the statute, viz., a  “transfer of the right to use” and not merely a license to use the goods:
  5. Having transferred the right to use the goods during the period for which it is to be transferred, the owner cannot again transfer the same right to others. 
  • Applying the ratio of above judgments and the test formulated by Hon’ble Supreme Court, the activity of providing pandal and shamiana along with erection thereof and other incidental activities do not amount to transfer of right to use goods. It is a service of preparation of a place to hold a function or event. Effective possession and control over the pandal or shamiana remains with the service provider, even after the erection is complete and the specially made–up space for temporary use handed over to the customer.

Accordingly services provided by way of erection of pandal or shamiana would attract the levy of service tax.

reminder letters/notices are not considered as Invoice under Rule 4A of the Service Tax Rules 1994

Thus it is clarified that reminder letters/notices for insurance policies not being invoices under rule 4A of Service Tax Rules 1994 and would not invite levy of service tax.

Service Tax Circular No.166/1/2013 Dated 1st January, 2013

Subject: – Clarification in respect of notices/ reminder letters issued for life insurance policies – regarding.

It has been represented by life insurance companies that in terms of the practice followed, reminder notices/letters are being issued to the policy holders to pay renewal premiums. Such reminder notices only solicit furtherance of service which if accepted by policy holder by payment of premium results in a service.  Clarification has been desired whether service tax needs to be paid on the basis of such reminders.

3.         The matter has been examined. Under the Point of Taxation Rules 2011, the point of taxation generally is the date of issue of invoice or receipt of payment whichever is earlier. The invoice mentioned refers to the invoices as issued under Rule 4A of the Service Tax Rules 1994. No tax point arises on account of such reminders. Thus it is clarified that reminder letters/notices for insurance policies not being invoices would not invite levy of service tax. In case of issuance of any invoice, point of taxation shall accordingly be determined.

4.         The above clarification is issued only for life insurance sector.

5.         Trade Notice/Public Notice may be issued to the field formations accordingly.

6.         Please acknowledge the receipt of this circular.

No Service tax on transportation of goods by rail/vessel transportation also includes milk

The service by way of transportation of milk by rail or a vessel from one place in India to another, is covered by the Notification No.25/2012-ST dated 20.06.2012 and no service tax will be charged on transportation. Central government has issued notification no 25/2012 which has exempted list of services from service tax in public interest. Read Notification No. 25/2012

Service Tax Circular No.167/2 /2013 dated, 1st January, 2013

Subject: Service tax on services by way of transportation of goods by rail/vessel – transportation of milk – regarding.

Representation has been received from the Indian Railways seeking clarification as to whether service by way of transportation of milk by rail is covered by Notification No.25/2012-ST dated 20.06.2012, serial number 20(i).

2.         The representation has been examined. The expression ‘foodstuff’ appearing in Notification No.25/2012-ST dated 20.06.2012, serial number 20(i) includes milk. Therefore, it is clarified that the service by way of transportation of milk by rail or a vessel from one place in India to another, is covered by the Notification No.25/2012-ST dated 20.06.2012.

3.         Trade Notice/Public Notice may be issued to the field formations and tax payers. Please acknowledge receipt of this Circular. Hindi version follows.

Notification No.25/2012-ST dated 20.06.2012.: The Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the following taxable services from the whole of the service tax leviable thereon under section 66B of the said Act, namely:-

 

Restoration of service specific accounting codes for payment of service tax

Restoration of service specific accounting codes for payment of service tax Service Tax Circular No.165/16/2012 -ST, F.No.341/21/2012-TRU dated New Delhi, 20th November, 2012

Subject: Restoration of service specific accounting codes for payment of service tax – regarding.

Negative List based comprehensive approach to taxation of services came into effect from the first day of July, 2012. Accounting code for the purpose of payment of service tax under the Negative List approach [“All Taxable Services” – 00441089] was prescribed vide Circular 161/12/2012 dated 6th July, 2012.

2.         Subsequent to the issuance of the Circular, suggestions were received from the field formations that the service specific old accounting codes should be restored, for the purpose of statistical analysis; also it was suggested that list of descriptions of services should be provided to the taxpayers for obtaining registration. These suggestions were examined and a decision has been taken to restore the service specific accounting codes. Accordingly, a list of 120 descriptions of services for the purpose of registration and accounting codes corresponding to each description of service for payment of tax is provided in the annexure to this Circular.

3.         Descriptions of taxable services given in the annexure are solely for the purpose of statistical analysis. On the advice of the office of the C & AG, a specific sub-head has been created for payment of “penalty” under various descriptions of services. Henceforth, the sub-head “other receipts” is meant only for payment of interest payable on delayed payment of service tax. Accounting Codes under the sub-head “deduct refunds” is not to be used by the taxpayers, as it is meant for use by the field formations while allowing refund of tax.

4.         Registrations obtained under the positive list approach continue to be valid. New taxpayers can obtain registrations by selecting the relevant description/s from among the list of 120 descriptions of services given in the Annexure. Where registrations have been obtained under the description ‘All Taxable Services’, the taxpayer should file amendment application online in ACES and opt for relevant description/s from the list of 120 descriptions of services given in the Annexure. If any applications for amendment of ST-1 are pending with field formations, seeking the description ‘all taxable services’, such amendment may not be necessary and the officers in the field formations may provide necessary guidance to the taxpayers in this regard. Directorate General of Systems will be making necessary arrangements for display of the list of 120 descriptions of services and their corresponding Accounting Codes in Form ST-1 and Form ST-2 as may be necessary.

5.         Officers in the field formations are instructed to extend necessary guidance to the tax payers regarding the selection of appropriate description of taxable service and facilitate the payment of service tax/cess due under the appropriate accounting code. Trade Notice/Public Notice may be issued to the field formations and tax payers. Please acknowledge receipt of this Circular. Hindi version follows.