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Basic Amendments In Service Tax for IPCC Exam -2013

I. Approaches for the levy of Service Tax: -

The Service Tax may be levied on the basis of any one of the following approaches: A. Comprehensive Coverage/approach: - Under this approach, all the services are taxable and a negative list is given which are exempted from tax. This approach is used in many developed countries. Under this approach it is required to define the service without any ambiguity/conflict. B. Selective Coverage/approach: - Under this approach, only selective services are included in the tax bracket. The list of taxable services and scope of coverage of each service is given under this approach. If any service is not falling in the list of taxable services then such service will be exempted for Service Tax. As mentioned earlier there were approx. 123 taxable services in the list of taxable services.

In India, selective approach was followed up to 30-6-2012. From 1-7-2012 comprehensive approach has been followed and a negative list has been issued for the levy of service tax. Now only the services in negative list will be exempted and all the remaining services will be taxable. This will be applicable from May, 2013 attempt. II.

Statutory Provision for Registration (Section 69 & Rule 4):

Every person who is liable to pay the Service Tax is under an obligation to get himself registered for Service Tax by making an application to the concerned Superintendent of Central Excise in specified form no. ST-1 (w.e.f. 30-9-2009, On-line filing of application for registration is compulsory now). The Central Government may also by notification in the Official Gazette, specify the persons or class of persons who shall make an application for the registration under service tax in such time and in such manner and in such form as may be prescribed. The following persons are required for mandatory registration: 1. Service Provider 2. Specified Persons {Rule 2(1) (d)} & Section 68(2): - Some specified persons (and not the service provider) who are liable to pay Service Tax are liable for registration. These are as below S. No. Category of Service Specified Person a) Insurance Auxiliary Service Insurance Company provided by an Insurance Agent. b) Service provided by a Person Liable: Specified Consignor / Goods Transport Agency for Consignee who pays or is liable to pay transport of goods by road. freight should pay the Service Tax. Specified consignor or consignee includes(i) Factory (ii) Company (iii) Corporation, (iv) Society (v) Cooperative Society(vi) Registered Dealer of Excisable goods (vii) Body Corporate (viii) Partnership Firm

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c) Legal Services provided by an Arbitral Tribunal or by an Advocate or firm of advocates to a business entity Sponsorship Service provided to any Body Corporation or Firm Any Taxable Service provided by any person from a country other than India u/s 66A Telecommunication Service Such business entity is required to pay service tax and is required to be registered for service tax.

d) e)

f)

g)

h) i)

Service Tax is to be paid by the Body Corporate or Firm, which receives the sponsorship service. Person receiving such service [in accordance with Taxation of Services (Provided from Outside India and Received in India) The Director General of P&T, Chairman of MTNL and any person who has been granted a licence by the Govt. under Indian Telegraph Act. Support services provided Such business entity is required to pay by govt. or local authority service tax and is required to be registered to any business entity for service tax. except some services Services provided by a Such company is liable to service tax director to company registration and payment Services of renting motor Both service provider and service receiver vehicles, supply of are required to service tax registration and manpower, security payment. services & work contract

III.

Adjustment of Excess Payment of Service Tax: Possibility of excess payment of service tax may be in the following cases: Case (1) Invoice issued or payment received but taxable service is not provided or renegotiation of amount of invoice [Rule 6(3)] If invoice issued or payment received against a service to be provided which is not provided either wholly or partly for any reason OR where the amount of invoice is renegotiated due to either of the following reasons: (i)Deficiency in Service (ii)Non-fulfillment of any terms of contract In above two situations, the assessee may take credit of excess service tax paid by him if: (i)He has refunded the to the person from whom it was received or (ii)He has issued a credit note for the value to the person to whom such an invoice was issued. Case (2) Service tax paid on estimated basis or on provisional basis [Rule 6(4)]- If an assessee is, for any reason, unable to correctly estimate, on the date of deposit, the actual amount payable for any particular month or quarter, he can make a request in writing to the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise, giving reasons for

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payment of service tax on provisional basis and the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise, on receipt of such request, may allow payment of service tax on provisional basis on such value of taxable service as may be specified by him and the assessee may request for provisional assessment in that case. Provisional assessment [Rule 6(5) & 6(6)]: The assessee requesting for provisional assessment shall file a statement giving details of the difference between the Service Tax deposited and the Service Tax liable to be paid for each month in a memorandum in Form ST-3A accompanying the halfyearly return in Form ST-3. In case of provisional assessment after due procedure and furnishing the returns in Form ST-3A along with Form ST-3, it is the responsibility of the Asstt./Deputy Commissioner to complete the assessment after calling for from the assessee the relevant documents or records, as may be considered necessary by him. Wherever the Asstt./Dy. Commissioner, after considering all the details/documents proposes to re-assess the Service Tax liability, the finalization of the provisional assessment would be made after providing adequate opportunity to the assessee by issuing the show cause notice and giving opportunity of being heard in person. Case (3) Excess payment is due to any other reason [Rule 6(4A) & 4(B)] Where due to any other reason, an assessee has paid to the credit of Central Government any amount in excess of the amount required to be paid towards service tax liability for a month or quarter, then assessee may adjust such excess amount paid by him against his service tax liability for the succeeding month or quarter. The adjustment of excess amount so paid, shall be subject to the condition that the excess amount paid is on account of reasons not involving interpretation of law, taxability, classification, valuation or applicability of any exemption notification.

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Amendments Related to Charge of Service Tax

(Section 66 & 68)
I. Chargeability of Service Tax (Section 66): Service Tax is chargeable @ 12% on the taxable value of services except those referred in the negative list or covered under list of mega exemptions. There is a single rate of charging service tax all over the country. As per the provisions of section 68(1) generally the service provider has to pay the service tax. In case of some of the specially notified services, as per section 68(2), service tax shall be collected from the person other than a service provider, in such manner & from such persons who shall be liable for the payment of service tax on such notified services. Service tax is generally charged on the services provided or to be provided but it is payable by the assessee only after the consideration for services actually been received. It means it is taxable on receipt basis (subject to Point of Taxation Rules, 2011) and therefore if some amount has been received in advance, the service tax has to be paid on such advance.

Effective rate of Service Tax: - The effective rate of service tax is calculated
taking in to consideration Education Cess (EC) and Secondary & Higher Education Cess (SHEC). The present rate of service tax is 12%, EC is 2% of service tax (w.e.f. 10-9-2004) and SHEC is 1% of the service tax (w.e.f. 11-5-2007). Thus the effective rate of service tax is 12.36% of the taxable value of services. In an invoice all the three elements should be indicated separately. Input credit of EC & SHEC is also available similar like service tax.

II.

Service means any activity carried out by a person for other person for consideration, and include a declared service, but does not include(a) an activity which constitutes merely, (i) a transfer of title in goods or immovable property, by way of sale, gift or in any other manner or (ii) such transfer, delivery or supply of any goods which is deemed to be a sale within the meaning of clauses (29A) of article 366 of the constitution (iii) A transaction in money or actionable claim (b) a provision of service by an employee to the employer in the course of or in relation to his employment (c) fees taken in any court or tribunal established under any law for the time being in force. (1) Activity: - The word activity has not been defined in the Finance Act. In terms of common understanding the word activity would include:(a) an act done, (b) work done, (c) an operation carried out, (d) execution of an act, or (e) provision of a facility, etc. (2) Consideration: - Activity should be carried on for a consideration in money or kind or partly for money or partly in kind. Consideration may be

Meaning of service [Section 65B(44)] -

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past, or present or future. If services are provided free of cost, it will not be liable to service tax. As per explanation 1 to section 65B(44), the functions or duties performed by following the persons shall not be treated as service for this purpose: 1. Functions performed by MP, MLA, Member of Municipality, Panchayat, Local Authority, 2. Duties performed by a person holding constitutional post by a person, like Governor of a state or Diplomats etc., 3. Duties performed by a person who is not deemed as an employee of the entity where he/she is working. For example chairman or member or a director of a body established by central or state government of local authority etc. (3) Meaning of declared service [Section 65(22)]: The meaning of service includes a declared service. Declared service means any activity carried out by a person for consideration and declared as such under section 66E. As per section 66E, the following shall continue declared services: (a) renting of immovable property (b) construction of a complex, building, civil structure or a part thereof , including a complex or building intended for sale to a buyer, wholly or partly, except where the entire consideration is received is received after issuance of completion certificate by the competent authority. (c) temporary transfer or permitting the use or enjoyment of any intellectual property right (d) development, design, programming, customization, adaptation, upgradation, enhancement, implementation of information technology software (e) agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act (f) transfer of goods by way of hiring , leasing, licensing or in any such manner without transfer of right to use such goods (g) activities in relation to delivery of goods on hire purchase or any system of payment by installments (h) service portion in the executive of a works contract (i) service portion in an activity wherein goods, being food or any other article of human consumption or any drink is supplied in any manner as a part of the activity.

III.

Negative List [Section 66D of the Finance Act, 1994]

The following services which are listed in section 66D known as negative list shall not be liable to service tax: 1. Services provided by Government or a local authority Services provided by a Government (both Central and State) or a local authority shall not be liable to service tax. However the following services provided by a Government or a local authority shall be taxable as it is excluded from the negative list. (i) services provided by the Department of Posts by way of (1) speed post, (2) Express parcel post, (3) life insurance and www.ascjaipur.com

Ascjaipur.com agency services carried out on payment of commission to a person other than government (i.e., on non-Government business) (ii) services in relation to an aircraft or a vessel, irrespective of the fact whether the services are provided inside or outside the area of a port or an airport (iii) transport of goods and/or passengers or (iv) support services, other than services covered under clauses (i) to (iii) above, provided to business entitles; Services provided by the Reserve Bank Of India Any service provided by the Reserve Bank of India to any person is not liable to service tax. But services provided to RBI are not in the negative list and would be taxable unless the same is covered in any other entry of negative list. For example service provided by a Bank to RBI is liable to service tax. All services provided by a foreign diplomatic mission in India All services provided by a foreign diplomatic mission located in India to any person are not liable to service tax. However, this entry does not cover services, if any, provided by any office or establishment of an international organisation Services relating to agriculture Services relating to agriculture or agricultural produce by way of (i) agricultural operations directly related to the production of an agricultural produce including cultivation, harvesting, threshing, plant protection, or seed testing (ii) supply of farm labour (iii) processes carried out at an agricultural farm including tending, pruning , cutting, harvesting, drying, cleaning, trimming, sun drying, fumigating, curing, sorting, grading, cooling or bulk packaging and such like operations which do not alter the essential characteristics of agricultural produce but make it only marketable for the primary market (iv) renting or leasing of agro machinery or vacant land with or without a structure incidental to its use (v) loading, unloading, packing, storage or warehousing of agricultural produce (vi) agricultural extension services (vii) services by any Agricultural Produce Marketing Committee or Board or Services provided by a commission agent for sale or purchase of agricultural produce Trading of goods Goods which are purchased and sold are not liable to service tax. The negative list contains the entry the trading of goods and not the services provided in relation to trading of goods. Activities of a commission agent or a clearing and forwarding agent who sell goods on behalf of another for a commission are not in the nature of www.ascjaipur.com

2.

3.

4.

5.

Ascjaipur.com trading of goods and hence such services provided by the agent shall be liable for service tax. Meaning of goods: - Goods means every king of movable property other than actionable claims and money and includes securities, growing crops, grass, and things attached to or forming part of the land which are agreed to be served before sale or under the contract of sale. Thus, every kind of moveable property other than these two shall fall within the definition of goods - (a) Achievable claims (b) Money 6. Any process amounting to manufacture or production of goods Any process amounting to manufacture or production of goods on which excise duty is leviable under the Central Excise Act or State Excise Act will not be liable to service tax. Further, it will also include manufacturing activities carried on contract or job work basis provided duty of excise is leviable on the same under the Central Excise Act or State Excise Act. 7. Selling of space or time slots for advertisements other that advertisements broadcast by Radio or Television - Sale of space for advertisements in prints media or in bill boards, public places, building, conveyances, etc. will not be liable to service tax but sale of space or time for advertisement broadcast by radio or television shall be taxable. However, services provided by advertisement agencies relating to making or preparation of advertisement shall not be covered in the negative list and hence would be taxable. 8. Service provided by way of access to a road or a bridge on payment of toll charges Service provided by way of access to a road or a bridge on payment of toll charges shall not be liable to service tax whether the road is a National highway or State highway. The above entry in negative list covers access to a road or a bridge on payment of toll charges. Services of toll collection on behalf of an agency authorized only to levy toll are in the nature of services used for providing the negative list services. Hence such service is liable to tax. 9. Betting, gambling or lottery The tax on betting and gambling is a State subject and hence the Central Government cannot levy tax on the same. Betting or gambling mean putting on stake something of value, particularly money, with consciousness of risk and hope of gain on the outcome of a game or a contest, whose result may be determined by chance or accident, or on the likelihood of anything occurring or not occurring.

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Ascjaipur.com Auxiliary services that are used for organizing or promoting betting or gambling events are not covered in this entry and hence liable to service tax. 10. Admission to entertainment events or access to amusement facilities Any entry fee paid for entertainment events such as movie tickets, a ticket for music events, drama, etc. or access to amusement facilities shall not be liable to service tax. Any cultural programme, drama or a dance whether held in open or in a theatre shall also fall in the negative list. Entertainment events has been defined in section 65B of the Act as an event or a performance which is intended to provide recreation, activity, fun or enjoyment, such as exhibition of cinematographic films, circus, concerts, sporting events, fairs, award functions, dance performances, musical performances, theatrical performances including cultural programs, drama, dance or any such event or programme. Amusement facility has been defined in the Act as a facility where fun or recreation is provided by means of rides, gaming devices or bowling alleys in amusement parks, amusement arcades, water parks, theme parks or such other places does not include a place within such facility where other services are provided. 11. Transmission or distribution of electricity by an electricity transmission or distribution utility Any transmission or distribution of electricity by central or state electricity authority or board or any other entity entrusted with such function by the Central or State Government shall not be liable to service tax. Services provided by way of installation of Gensets or similar equipments by a private contractor for distribution of electricity does fall in the negative list and hence would be liable to service tax. 12. Specified services relating to education The following services relating to education shall not be liable to service tax as these falls in the negative list: (i) Pre-school education and education up to higher secondary school or equivalent (ii) (iii) 13. Education as a part of a curriculum for obtaining a qualification recognised by any law for the time being in force: Education as a part of an approved vocational education course.

Service by way of renting of residential dwelling for use as residence Services by way of renting of residential dwelling for use as residence shall not be liable to service tax. However, it does not include hotel, www.ascjaipur.com

Ascjaipur.com motel, guest house, lodge, house boat or like places meant for temporary stay. 14. Certain services provided by financial sector Services by way of (i) Extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount (ii) Sale or purchase of foreign currency amongst banks or authorised dealers of foreign exchange or amongst banks and such dealers.

15.

Services relating to transportation of passengers The following services of transportation of passengers, with or without accompanied belongings shall not be liable to service tax. Service of transportation of passengers by (i) A stage carriage (ii) Railways in a class other then(a) First class or (b) An air-conditioned coach (iii) (iv) (v) (vi) Metro, monorail or tramway Inland waterways Public transport, other than predominantly for tourism purpose, in a vessel of less than fifteen tonne net and Metered cabs, radio taxies or auto rickshaws.

16.

Services provided by way of transportation of goods The following services provided by way of transportation of goods shall not be liable to service tax. Services provided: (i) By road except the services of (a) A goods transportation agency or (b) A courier agency (ii) (iii) By an aircraft or a vessel from a place outside India to the first customs station of landing in India or By inland waterways.

17. Funeral, burial, crematorium or mortuary services including transportation of the deceased. www.ascjaipur.com

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IV.

Service Tax on the services received from outside India (non-taxable territory) (Section 66A): If any service (other than those covered in negative list or mega exemptions), is provided by a service provider who has i. established any business or any fixed establishment outside India from where services are provided, or ii. his unusual place of residence or permanent address outside India and if such services have been received by any person (i.e., recipient of service) who is having his place of business or any fixed establishment or permanent address or unusual place of residence in India (taxable territory) then such services will be chargeable to tax in the hands of recipient of services assuming that such services have been provided by the recipient himself in India. Such services shall not be taxable for the service provider. Although if such services were received by an individual assessee then such services shall be taxable only if these were received by him in any business or commerce.

V.

Exemptions from Service Tax: As mentioned earlier powers are given to the Central Govt. U/S 93 & 94 of chapter V of Finance Act, 1994, for certain exemptions from the service tax through specific notifications issued on time to time. These exemptions are as below: -

(A)

Basic exemption of Rs. 10 Lacs (Notification No. 33/2012 dated 20-6-2012): - If we go by the provisions of Income Tax Act,
1961 & Central Excise Act, 1944 then we find some basic or minimum exemptions. Like under Income Tax Act, no income tax is payable by an individual & HUF if the total income is not exceeding Rs 2,00,000/- and similarly no excise duty is payable if the turnover of an industrial unit does not exceed Rs. 1.50 Crores. In case of service tax no such basic exemption was there till 31.05.2005 and therefore the small service providers were facing competition, problems & hardship in the real market. To resolve this hardship, w.e.f. 1-4-2005, the Central govt. has exempted the small service providers from service tax levy if the aggregate value of taxable services does not exceed Rs. 10 Lacs in any financial year (this limit was Rs. 8 Lacs for the financial year 2007-08 & Rs. 4 Lacs prior to financial year 200708, vide notification no. 6/2005 dated 1-3-2005). Although this basic exemption shall not be available to a person providing such services under the brand name or trade name of other person (like franchisee). Also such basic exemption will be available to the service providers only and not to the service recipients. Following are some of the important points regarding such basic exemptions: i. The service provider has an option not to avail the basic exemption of Rs. 10 Lacs but once this option is exercised in any financial year then it cannot be withdrawn during the remaining part of financial year. ii. If services are provided in one or more premises/offices by the service provider then for the purpose of limit of Rs. 10 Lacs,

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aggregate of services provided in all such offices/premises would be taken in to consideration. The basic exemption of Rs. 10 Lacs is available for every individual financial year. For a newly started business, the basic exemption limit would be applicable from the date of start of business up to 31 st March of end of such financial year. The service provider cannot avail input credit/ CENVAT Credit of service tax during the period of exemption from service tax up to limit of Rs. 10 Lacs. The service tax shall be applicable on the service provider during a financial year if the limit crossed of Rs. 10 Lacs during such financial year. Suppose the total of bills of services provided from 14-2011 to 31-10-2011 was Rs. 9,80,000/- & the next bill is of Rs. 50,000/- then total goes to Rs. 10,30,000/- & thus it exceed Rs. 10 Lacs therefore service tax would be applicable on Rs. 30,000/- @ 10.3%. A service provider is allowed to avail exemption of Rs. 10 Lacs only if during the just preceding financial year the taxable value of services does not exceeded Rs. 10 Lacs. If during preceding financial year the limit of taxable services already crossed Rs. 10 Lacs then all the services will be taxable from the first day of current financial year.

iii.

iv. v.

vi.

(B)

Exemption in case of export of services: - As per section 66B, if any service is provided or agreed to be provided in the taxable territory then it is taxable but if a service is provided outside the taxable territory then it is exempted. Vide section 66C of the Finance Act, the central govt. has power to determine the place of service where it is provided or deemed to have been provided. As per rule 3 of Place of Provisions of Service Rules, 2012, the place of service provided shall be the location of the recipient of service. As per this rule it is implied that service tax is not applicable on export of service because the place of recipient of service is outside India.
Any service is considered as export of service if the following conditions are satisfied 1. The service provider is located in India 2. The service receiver is located outside India 3. The service is not covered in negative list 4. The place of provision of service is outside India 5. The payment of such service has been received to the service provider in convertible foreign exchange.
Note: Vide notification no. 39/2012-ST dated 1-7-2012, the central government has granted rebate in respect of excise duty, service tax and cess paid by assessee on all the inputs used in providing the export service as per rule 6A of the Service Tax Rules, 1994 to any country except Nepal & Bhutan.

(C)

Specific exemptions (i.e., Lower rate abatements): (Notification No. 26/2012-ST dated 20-06-2012) - As per the service
tax rules there are some specific services which are although taxable but an abatement is given to the service provider and the full amount of service is not

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taxable. The basis of such rebate/abatement is the cost of material sold in the process of providing such services. Some exemptions of lower rates are as mentioned below: S. No. Type of service Rate of Abatement Taxable Amount of service Remarks

1. 2. 3. 4. 5. 6. 7.

Transport of passengers by Air with or without luggage Transport of goods & passengers by Rail with or without luggage Transport of goods in a Vessel Rent-a-Cab services Chit fund services Finance Lease & Hire Purchase services Services of supply of food & drinks in hotel, club, convention centres, pandal, shamiana etc., in any function with renting of the premises Lodging & boarding services in hotels, guest houses and other commercial places Construction of a complex, civil structure or building etc. for sale to buyers Tour operator services a) For Package tour b) For Accommodation booking only c) For tour other than a package tour Goods transport agency

60% 70% 75% 60% 30% 90% 30%

40% 30% 25% 40% 70% 10% 70%

No CENVAT credit on inputs and capital goods ---No CENVAT credit No CENVAT credit No CENVAT credit on inputs and capital goods ---No CENVAT credit on food items

8. 9. 10.

40% 75%

60% 25%

No CENVAT credit on inputs and capital goods CENVAT credit should have not been taken

75% 90% 60% 75%

25% 10% 40% 25% No CENVAT credit

11.

(D)

If sale value of goods cannot be separately determined In case of work contracts generally value of goods and value of service cannot be determined separately therefore the following rules shall be applied
Type of work contract Work contract of execution of original work Work contract entered for maintenance or restoration or servicing of any goods Work contracts except above two Taxable value of bill amount Service tax will be charged on 40% of the gross amount of billing Service tax will be charged on 70% of the gross amount of billing Service tax will be charged on 60% of the gross amount of billing

S. No. 1. 2. 3.

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(E) Generally the service provider is liable for the payment of service tax but in some of the exceptional cases u/s 68(2), Service Tax Rule 2(1)(d), service tax is payable by service recipient also. Some of such exceptional cases are as below: S. No. Type of the Service % of service % of service tax payable tax payable by Service by Service Provider Recipient 1. Services by an insurance agent to --100% insurer or insurance company 2. Services by goods transport --100% of 25% agency to for transportation of of freight goods 3. Services of sponsorship --100% 4. Services by an Arbitral Tribunal --100% 5. Legal Services by an individual --100% advocate or firms of advocate 6. Services by director to a company --100% 7. Support services by Govt. or Local --100% authority except renting of immovable property. 8. Services of renting of motor --100% vehicle to carry passengers on abated value basis, to any person who is not engaged in similar business 9. Services of renting of motor 60% 40% vehicle to carry passengers on non-abated value basis, to any person who is not engaged in similar business 10. Services of supply of manpower 25% 75% for security purpose 11. Services of work contract 50% 50% 12. Services by persons from non--100% taxable territory to person in taxable territory

(F)

Alternate rate of service tax in case of certain services: - Although service tax is levied at the basic rate of 12% but in case
of certain services, an alternative rate is also provided. Some of these are as under:

S. No. 1. 2. 3.

Particulars In case of Air Travel Agent services In case of Works Contract Services In case of life insurance business services

Service Tax Rate 0.6% of the basic fare of Domestic bookings & 1.2% of basic fare of International bookings. 4.8% on Gross Amount charged 3% of gross premium in the first year & 1.5% in next years, if break-up of risk & investment

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portion not given. Services of purchase & sale of foreign currency including money changing services For amount up to Rs. = 0.12% of the gross amount of currency exchanged (Minimum Rs. 30) 1,00,000 After Rs. 1 Lac to Rs. 10 = Rs. 120 Plus 0.06% of gross amount = Rs. 660 Plus 0.012% of gross amount but Lac Maximum Rs. 6,000 Above/After Rs. 10 Lacs 5. Service tax for a distributor or selling agent of lotteries If guaranteed lottery prize = Rs. 7,000 on every Rs. 10 Lacs (or part thereof) of total face value of lottery tickets amount is 80% or more If guaranteed lottery prize = Rs. 11,000 on every Rs. 10 Lacs (or part thereof) of total face value of lottery tickets amount is less than 80% Note: EC & SHEC will be added separately to all the above service tax liability. 4.

(G)

Exemption of services provided to the diplomatic missions for their office use (Notification No. 27/2012-ST dated 2006-2012): - All type of taxable services provided by the service providers to
the Foreign Diplomatic Missions or Consular posted in India for their office use. For this purpose an entitlement certificate must be issued by the Protocol Division of the Ministry of External Affairs, with or without condition. Exemption would be allowed on the basis of such certificate.

(H)

Exemption of services provided to the diplomatic persons for their personal use (Notification No. 27/2012-ST dated 20-06-2012): - Taxable Services those mentioned u/s 65(105) provided by a
service provider to the Diplomatic Mission Agents or Career Consular officer working in a Foreign Diplomatic Mission or Consular posted in India for their personal use or for their family members are fully exempted from service tax. Again the aforesaid entitlement certificate would be required for the exemption. Also a photo identification card is issued by the Protocol Division of the Ministry of External Affairs with unique serial number.

(I)

Exemption of services provided to Units in Special Economic Zone (SEZ) (Notification No. 40/2012-ST dated 20-062012): - Services provided to the developer of SEZ or the units situated in
SEZ are fully exempted from service tax. The following conditions must be satisfied: i. Proper accounting of the receipts & utilization of such taxable services is required to be maintained by the developer or the unit existing in SEZ. ii. The unit of SEZ must be approved from the Board of Approvals or Development Commissioner to establish such unit in SEZ, iii. The developer must have been approved by the Board of Approvals for the development & maintenance of SEZ.

(J)

Exemption to service provided by Technology business incubator / science and Technology Entrepreneurship Park (Notification No. 32/2007 dated 20-06-2012): - All the taxable
services provided or to be provided by Technology business incubator / science

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and Technology Entrepreneurship Park recognised by the National Science and Technology Entrepreneurship Board (NSTEBD) of the department of science and technology have been exempted from the whole of service tax leviable thereon. The exemption contained in this notification shall be subject to some conditions.

(K)

Exemption to the services provided by incubatee located within the premises of a technology business incubator / science and technology Entrepreneurship park - (Notification No. 32/2007 dated 20-06-2012): - W.e.f. 1-4-2007, taxable services provided
or to be provided by an (incubatee) Entrepreneur located within the premises of a technology business incubator (TBI) / science and technology Entrepreneurship park (STEP) recognised by the National Science and Technology Entrepreneurship Board (NSTEBD) of the department of science and technology have been exempted from the whole of service tax leviable thereon. The exemption contained in this notification shall be subject to some conditions.

(L)

Mega Exemption Notification No.25/2012- Service tax, Dated 20.6.2012 The exemptions provided in the mega exemption notification are as under 1. Service provided to the United Nations or a specified international organization 2. Health care service by a clinical establishment, an authorized medical practitioner or Para-medics 3. Service by a veterinary clinic in relation to health care of animals or birds 4. Service by an entity registered u/s 12AA of the Income Tax act, 1961 by way of charitable activities 5. Service by a person by way of: (a) renting of precincts of a religious place meant for general public or (b) conduct of any religious ceremony 6. Service provided by: (a) an arbitral tribunal to: (I) any person other than a business entity or (II)a business entity with a turnover upto rupees ten Lakh in the preceding financial year (b) an individual as an advocate or a partnership firm of advocates by way of legal service to (I) any person other than business entity or (II) A business entity with a turnover upto rupees ten Lakh in the preceding financial year or (c) a person represented on an arbitral tribunal to an arbitral tribunal 7. Service by way of technical testing or analysis of newly developed drugs including vaccines and herbal remedies, on human participants www.ascjaipur.com

Ascjaipur.com by a clinical research organization approved to conduct clinical trials by the Drug Controller General of India 8. Services by way of training or coaching in recreational activities relating to arts, culture or sports 9. Service provided to or by an educational institution in respect of education exempted firm service tax, by way of (a) auxiliary educational service or (b) training of immovable property 10. Service provided to recognized sports body by: (a) an individual as a player, referee, umpire, coach or team manager for participation in a sporting event organized by recognized sports body (b) another recognized sports body 11. Services by way of sponsorship of sporting events organized: (a) by a national sports federation, or its affiliated federations, where the participating teams or individuals represent any district, state or zone (b) by Association of Indian Universities, Inter-University Sports Board, School Games Federation of India, All India Sports Council for the Deaf, Paralympics Committee of India or Special Olympics Bharat (c) by General Civil Service Cultural and Sports Board (d) a parts of national games by Indian Olympic Association or (e) under Panchayat Yuva Kreeda Aur Khel Abhiyan (PYKKA) Scheme 12. Service provided to the Government, a local authority or a governmental authority by way of construction, erection, commissioning, installation, completion, fitting out, repair , maintenance, renovation, or alteration of :(a) a civil structure of any other original works meant predominantly for use other than for commerce, industry, or any other business or person (b) a historical monument, archaeological site or remains of national importance, archaeological excavation, or antiquity specified under the Ancient Monuments and archaeological sites and remains act, 1958 (24 of 1958) (c) a structure meant predominantly for use as (i) an educational, (ii) clinical, or (iii) an art or cultural establishment (d) canal, dam or other irrigation works (e) pipeline, conduit or plant (i) water supply (ii) water treatment, or (iii) sewerage treatment or disposal or (f) a residential complex predominantly meant for self-use or the use of their employees or other persons specified in the Explanation 1 to clause 44 of section 65B of the said Act 13. Service provided by way of construction, irrigation, commissioning, installation, completion, fitting-out, repair, maintenance, renovation, or alteration of www.ascjaipur.com

Ascjaipur.com (a) a road bridge , tunnel, or terminal for road transportation for use by general public (b) a civil structure or any other original works pertaining to a scheme under Jawaharlal Nehru National Urban Renewal Mission or Rajiv Awaas Yojana (c) a building owned by an entity registered U/s 12AA of the Income Tax Act, 1961 and meant predominantly for religious use by general public (d) a pollution control of effluent treatment plant, except located as a part of a factory or a structure meant for funeral, burial or cremation of deceased 14. Service by way of construction, erection, commissioning, installation of original works pertaining to, (a) an airport, port of railways, including mono rail or metro (b) a single residential unit otherwise than as a part of a residential complex (c) low-cost houses upto a carpet area of 60 sq. meters per house in a housing project approved by competent authority empowered under the Scheme of affordable housing in partnership framed by the ministry of housing a urban poverty Alleviation Government of India (d) post-harvest storage infrastructure for agriculture produce including a cold storages for such purposes or (e) mechanized food grain handling system, machinery or equipment for units processing agriculture produce as food stuff excluding alcoholic beverages 15. Temporary transfer of permitting the use or enjoyment of a copyright covered under clauses (a) or (b) of sub-section (i) of section 13 of the Indian Copyright Act, 1957, relating to original literary, dramatic, musical, artistic work of cinematograph films 16. Service by a performing artist in folk or classical art forms of (i) music, (ii) dance, (iii) theatre, excluding services provided by such artist as a brand ambassador 17. Services by way of collecting or providing news by an independent journalist, Press Trust of India or United Trust of India 18. Services by way of renting of a hotel, inn, guest house, club, campsite or other commercial places meant for residential or lodging purposes, having declared tariff of a unit of accommodation below rupees one thousand per day or equivalent 19. Services provided in relation to serving of food or beverages by a restaurant, eating joint or a mess, other than those having (i) the facility air-conditioning or central air-heating in any part of the establishment, at any time during the year, and (ii) a license to serve alcoholic beverages 20. Services by way of transportation by rail or a vessel from one place in India to another of the following goods -

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Ascjaipur.com i. petroleum and petroleum products filling under chapter ending 2710 and 2711 of the first schedule to the Central Excise Tariff Act, 1985 ii. relief materials meant for victims of natural or man-made disasters, calamities, accidents, mishap iii. defence or military equipments iv. postal mail or mail bags v. household effects vi. newspaper or magazines registered with the registrar of news papers vii. railways equipments or materials viii. agricultural produce ix. food stuff including flours, tea, coffee, jiggery, sugar, milk products, salt and edible oil, excluding alcoholic beverages or x. chemical fertilizers and oil cakes 21. Services provided by a goods transport agency by way of transportation of (a) fruits, vegetables, eggs, milk, food grains or pulses in a goods carriage (b) goods where gross amount charged for the transportation of goods on a consignment transported in a single goods carriage does not exceed one thousand five hundred rupees or (c) goods, where gross amount charged for transportation of all such goods for a single consignee in the goods carriage does not exceed rupees seven hundred fifty 22. Services by way of giving on hire (a) to a state transport undertaking, a motor vehicle meant to carry more than twelve passengers or (b) to a goods transport agency, a means of transportation of goods 23. Transport of passengers, with or without accompanied belongings, by (a) air, embarking from or terminating in an airport located in the state of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, or Tripura or at Bagdogra located in West Bengal (b) a contract carriage for the transportation of passengers, excluding tourism conducted tour, character or hire or (c) ropeway, cable car or aerial tramway 24. Services by way of vehicle parking to general public excluding leasing of space to an entity for providing such parking facility 25. Services provided to Government, a local authority or a governmental authority by way of: (a) carrying out any activity in relation to any function ordinarily interested to a municipality in relation to water supply , public health , sanitation conservancy , solid waste management or slum improvement an up gradation or (b) repair or maintenance or a vessel or an aircraft www.ascjaipur.com

Ascjaipur.com 26. Service of general insurance business provided under following schemes :(a) Hut insurance scheme (b) Cattle insurance under Swarnajayanti Gram Swarozgar Yogana (earlier known as integrated Rule Development Programme ) (c) Scheme for Insurance of Travels (d) Janta Personal Accident Policy and Gramin Accident Policy (e) Group Personal Accident Policy for Self-employed Women (f) Agricultural Pump set And Failed Well Insurance (g) Premium collected on export credit insurance (h)Weather Based Crop Insurance Scheme or the Modified National Agricultural Insurance Scheme, approved by the Government of India and implemented by the Ministry of Agriculture (i) Jan Arogya Bima Policy (j) National Agricultural Insurance Scheme (Rashtrya Krishi Bima Yojana) (k) Pilot Scheme on Seed Crop Insurance (l) Central Sector Scheme on Cattle Insurance (m) Universal Health Insurance Scheme (n) Rashtriya Swasthya Bima Yojna or (o) Coconut Palm Insurance Scheme 27. Service provided by an incubate upto a total turnover of fifty lakh rupees in a financial year subject to the following conditions, namely: (a) the total turnover had not exceeded fifty lakh rupees during the preceding financial year and (b) a period of three year has not been elapsed from the date of entering into an agreement as an incubate 28. Service by an unincorporated body or an non- profit entity registered under any law for the time being in force, to its own members by way of reimbursement of charged or share of contribution (a) as a trade union (b) for the provision of carrying out any activity which is exempt from levy of service tax or (c) up to an amount of five thousand rupees per month per member for sourcing of goods or services from a third person for the common use of its members in a housing society or residential complex 29. Services by the following persons in respective capacities(a) sub-broker or an authorized person to a stock broker (b) authorized person to a member of a commodity exchange (c) mutual fund agent to a mutual fund or asset management company (d) distributor to a mutual fund or asset management company (e) selling or marketing agent of lottery tickets to a distributer or a selling agent (f) selling agent or a distributer of SIM cards or recharge coupon vouchers www.ascjaipur.com

Ascjaipur.com (g) business facilitator or a business correspondent to a banking company or an insurance company, in rural area (h) sub-contractor providing service by way of works contract to another contractor providing works contract services which are exempt 30. Crime out an intermediate production process as job work in relation to :(a) agriculture printing or textile processing (b) cut and polished diamonds and gemstones or plain and studded Jewellary of gold and other precious metals, filling under chapter 71 of the Central Excise Tariff Act, 1985 (c) any goods on which appropriate duty is payable by the principal manufacturer or (d) process of electroplating, zinc plating, anodizing, heat treatment, powder coating, painting including spray painting or auto black, during the course of manufacture of parts of cycles or sewing machines up to an aggregate value of taxable service of the specified processes of rupees of one hundred and fifty lakh rupees in a financial year subject to the condition that such aggregate value had not exceeded one hundred and fifty lakh rupees during the preceding financial year 31. Services by an organizer to any person in respect of a business exhibition held outside India 32. Services by way of making telephone calls from(a) departmentally run public telephone (b) guaranteed public telephone operating only for local calls or (c) free telephone at airport and hospital where no bills are being issued 33. Services by way of slaughtering of bovine animals 34. Services received from a provider of service located in an nontaxable territory by (a) Government, a local authority, a governmental authority or an individual in relation to any purpose other than commerce, industry or any other business or profession (b) an entity registered under section 12AA of the Income Tax Act, 1961 for the purposes of providing charitable activities (c) a person located in a non-taxable territory 35. Services of public libraries by way of lending books, publications or any other knowledge-enhancing content or material 36. Services by Employees State Insurance Corporation to persons governed under the Employees Insurance Act, 1948 37. Services by way of transfer of a going concern, as a whole or an independent part thereof 38. Services by way of public conveniences such as provision of facilities of bathroom, washrooms, lavatories, urinal or toilets 39. Services by a governmental authority by way of any activity in relation to any function entrusted to a municipality under article 243W of the constitution. www.ascjaipur.com

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