The appellants were sending their manager/ employees to hotels run by the subsidiary/ associate companies on deputation. They were recovering costs on actual basis and were not retaining any amount out of the payment made by the hotels run by the subsidiary/ associate companies. The contention of the Department is that the appellants were engaged in manpower supply service as they were supplying their manpower to hotels run by associate companies on a cost recovery basis.
The appellant was a franchisee of BCCI-IPL and received payment from BCCI-IPL as its share in receipts towards media rights and other income collected centrally by BCCI-IPL. The key issue in the appeal was whether the amount received by the appellant from BCCI-IPL liable to service tax as business support services provided to BCCI-IPL.
No service tax will be leviable on the amount of foreign currency remitted to India from abroad: Service has been defined under Section 65B (44) of the Finance Act, 1994. The definition specifically excludes a transaction in money or actionable claim. As the remittance of foreign currency from abroad is a transaction in money, therefore, it will fall outside the ambit of service. Accordingly, no service tax will be leviable on it.
Query:- What is the option open to the Assessee following Works Contract (Composition Scheme for Payment of Service Tax) Rules, 2007 which is rescinded vide Notification No. 35/2012-ST dated 20-6-2012, w.e.f 1-7-2012. Answer:- Change in the manner of payment of tax from composition scheme under erstwhile the Works Contract (Composition Scheme for Payment of Service Tax) Rules, 2007 will change either to make payment of service tax on actual value under clause (i) of Rule 2A of the Service Tax (Determination of Value) Rules, 2006 or under clause (ii) of Rule 2A – Composite rate:-
Yesterday, the TRU has issued number of Notifications to give effect of implementation of Paradigm shift in taxation of Services –Budget 2012 by way of either rescinding or amending old Notifications including some of recently issued Notifications during the time of Budget 2012 i.e. 17th March, 2012, which were supposed to come into force from the date on which the new Section 66B (the new charging Section) i.e. 1st July 2012.
Recently Service Tax (Determination of Valuation Rules), 2012 vide Notification No. 11/2012 –S.T dated 17.03.2012 amended the Service Tax (Determination of Value) Rules, 2006 which were supposed to come into force from the date on which the new Section 66B (the new charging Section) comes into effect i.e. 1st July 2012 but the said Rules got superseded before coming into force vide Notification no. 24/2012-ST dated 06.06.2012 (the Notification no. 24/2012-ST).
The Union Budget 2012 has proposed multiple changes in Service Tax. One of the important aspects of burden of tax liability under Reverse Charge concept has also been proposed to be replaced from existing provisions. Applicability of New Reverse Charge Mechanism -According to Notification No 15/2012-ST dated 17.03.2012, which supersedes notification no. 36/2004-ST dated 31.12.2004, the proposed Reverse Charge Mechanism will be made applicable from the date on which Section 66B of the Finance Act,1994 comes into force i.e. 1-7-2012.
The Central Government vide Notification No. 19/2012-ST dated 05.06.2012 has announced Date of Introduction of new regime of most awaited Negative List approach in Service Tax, which will apply w.e.f. 01.07.2012 i.e. service tax would be applicable on all services except those mentioned either in the Negative List or in the Mega Exemption vide Notification No. 12/2012-ST dated 17.03.2012.
The Central Government by exercising the power conferred by clause (i) of sub-section (2) of section 94 of the Finance Act, 1994 (32 of 1994) has made the Service Tax (Compounding of Offences) Rules, 2012 (herein after referred as the Compounding of offences Rules, 2012) published by Notification No.17/2012-ST, dated 29.05.2012.
Please note that Hon’ble President has given her assent to the Finance Bill, 2012 and got enacted as Finance Act(No 23 of 2012) on May 28,2012. We have summarized various statutory provisions have been made applicable w.e.f. 28-05-2012.
