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Amendments in Service Tax Act:

Chapter V of the Finance Act, 1994 is being amended to,-

a) insert an explanation in sub-section (3) of Section 73 to clarify that no penalty shall be imposed where service tax along with interest has been paid before issuance of notice by the department under this sub-section.

b) provide definition of the term ‘business entity’ to include an association of persons, body of individuals, company or firm but not an individual.

The above changes at (a) will come into effect from a date of enactment of the Finance Bill, 2010 and (b) from a date to be notified after the enactment of Finance Bill, 2010.

Amendments In Rules And Notifications Related To Service Tax:

1) Export of Services Rules, 2005 and Taxation of Services (Provided from Outside India and Received in India) Rules, 2006 are being amended so as to move some of the specified taxable services from one category to another.

2) In the Export of Services Rules, 2005, the condition prescribed i.e. ‘such service is provided from India and used outside India’ is being deleted.

3) Notification No. 1/2002-ST dated 01.02.2002 is being superceded by another notification to provide that the construction and operation of installations, structures and vessels for the purposes of prospecting or extraction or production of mineral oils and natural gas in the Exclusive Economic Zone and the Continental Shelf of India and for supply of any goods connected with these activities would be within the purview of the provisions of Chapter V of Finance Act, 1994. Suitable changes are being made in the Export of Services Rules, 2005 and Taxation of Services (Provided from Outside India and Received in India) Rules, 2006.

4) Notification No. 5/2006-CE (NT) is being amended and given partial retrospective effect to remove the bottlenecks in refund of accumulated credit to the exporters.

The above changes will come into effect immediately.

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0 Comments

  1. NILESH SANGHAVI says:

    If the transporter will collect the service tax @ 10.3% from the party then, whether we are liable to get the Amendment of 75% on our basic cost??

  2. mrs l y dsouza says:

    Pl let me know os an NRI buyer am I exempted from payng th new service tax for purchase of a flat in goa.Thank you for your kind service

  3. N. V. Sharma says:

    Ours is an educational Trust and exempt from Service Tax. My querry is since we are exempt, can a service provider like advertisement Agency charge us Service Tax?

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