Ashok Thakur
Effective from 01.07.2013 in terms of service tax notification no 12/2013-ST, All SEZ Unit/ Developers/ Co-developers have to provide Form A2 authorisation from service tax authority for availing the upfront service tax exemption otherwise first pay service tax and claim refund of it from the Govt.
Upfront exemption has to be provided only on the basis of the Form A2 authorisation date which is issued on the basis of Form A1 Declaration duly verified by the SEZ Authority. If Form A2 has not been provided SEZ Unit/ Developers/ Co-developers is not eligible for upfront exemption.
Later Govt. also made amendment in the above notification effective from 11.07.2014 thereby only giving some relax time for applying Form A2 authorisation within 15 days of receipt if Form A1 Declaration.
It is pertinent to mention that recently Govt. has made harassed provision for charging interest @ 30% if there is a delay of service tax deposit more than one year. There has been the case of delay more than one year in depositing the service tax due to non-payment of service tax by the clients on account of Form A2 authorisation. Under the situation further delay will put additional burden of higher interest for which there is no provision for the waiver of interest.
Appended below Check List for passing on upfront service tax exemption to SEZ Unit
For the Period 01.03.2011 to 30.06.2012 (As per Service Tax Notification No. 17/2011-ST) |
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Sr. No |
Documents Required |
Condition to be fulfilled/not fulfilled |
Exemption Effective From |
Whether Service Tax /Interest to be Charged |
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Condition |
Form A1/ Letters /Form A2 provided (Yes Or No) |
Service Tax |
Interest |
|||
1(a) |
Form A1 |
Form A1 to be provided up to 30.06.2012 by SEZ Unit. |
Yes |
01.03.2011 |
No |
No |
1(b) |
Letter |
In absence of Form A1- SEZ Unit has to provide letter from their respective SEZ Office confirming that Form A1 is not applicable for this period. |
Yes |
01.03.2011 |
No |
No |
1( c) |
Form A1 |
Form A1 to be provided up to 30.06.2012 by SEZ Unit |
No |
No Exemption |
Yes, w.e.f 01.03.2011 |
Yes, w.e.f 01.04.2011 |
1(d) |
Letter |
In absence of Form A1 – SEZ Unit has to provide letter from their respective SEZ Office confirming that Form A1 is not applicable for this period. |
No |
No Exemption |
Yes, w.e.f 01.03.2011 |
Yes, w.e.f 01.04.2011 |
For the Period 01.07.2012 to 30.06.2013 (As per Service Tax Notification No. 40/2012-ST) |
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2(a) |
Form A1 |
Form A1 to be provided up to 30.06.2013 by SEZ Unit. |
Yes |
01.07.2012 |
No |
No |
2(b) |
Form A1 |
Form A1 to be provided up to 30.06.2013 by SEZ Unit. |
No |
No Exemption |
Yes, w.e.f 01.07.2012 |
Yes, w.e.f 06.08.2012 |
For the Period 01.07.2013 to 10.07.2014 (As per Service Tax Notification No. 12/2013-ST) |
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3(a) |
Form A2 |
Form A2 is to be provided having the validity effective from 01.07.2013 categorically mentioned in the Form and should be provided upto 10.07.2014 by SEZ Unit. |
Yes |
01.07.2013 |
No |
No |
3(b) |
Form A2 |
Form A2 is not containig validity date as 01.07.2013 but provided upto 10.07.2014 by SEZ Unit. |
Yes – without effective date |
From the date of submission of Form A2 to us |
Yes – For the period 01.07.2013 to date of submission of Form A2 |
Yes – For the period 06.08.2013 to date of submission of Form A2 |
From 11.07.2014 onwards (As per Service Tax Notification No. 12/2013-ST as amended 07/2014-ST) |
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4(a) |
1) Form A2 alongwith Form A1 or |
Form A2 has been applied & obtained within 15 days of Form A1 date by the SEZ Unit a |
Yes |
From the date of Form A1 |
No |
No |
2) Application of Form A2 alongwith Form A1, Form A2 |
Application of Form A2 alongwith Form A1 is to be provided immediately to us and subsequently Form A2 is also to be provided to us within 3 month of the starting of service/billing. |
Yes |
From the date of Form A1 |
No |
No |
|
4(b) |
1) Form A2 alongwith Form A1 or |
Form A2 has been applied & obtained within 15 days of Form A1 date by the SEZ Unit |
No |
No Exemption |
Yes |
Yes |
2) Application of Form A2 alongwith Form A1, Form A2 |
Application of Form A2 alongwith Form A1 is to be provided immediately to us and subsequently Form A2 is also to be provided to us within 3 month of the starting of service/billing. |
No |
No Exemption |
Yes |
Yes |
|
Hello,
One of our client provided Services from july13 to march14 to unit located in SEZ without obtaining Declaration i.e. FORM A2, as he was unaware of the amendment and further his client failed to provide so after no of followups. Now he has no commercial relationship with that client.
Recently he has been issued a notice demanding service tax for services provided to SEZ unit.
kindly guide on the above issue.
Thanks.
Hello,
One of our client provided Services from july13 to march14 to unit located in SEZ without obtaining Declaration i.e. FORM A2, as he was unaware of the amendment and further his client failed to provide so after no of followups. Now he has no commercial relationship with that client.
Recently he has been issued a notice demanding service tax for services provided to SEZ unit.
kindly guide on the above issue.
Thanks.
One of our customers, a contractor of an SEZ, wants us to exempt it from service tax based on a Form A2 issued in favour of the developer. Nowhere in the Form A2, the contractor’s name appears. The contractor has submitted a “To whomsoever it may concern” letter issued by the Specified Officer of the SEZ stating that it is a contractor to the SEZ developer, and accordingly it is “entitled” for all the benefits of the SEZ unit, including ab initio tax exemption. I would appreciate if someone can advise if the Form A2 authorization by the Commissioner in the name of the developer can also be extended to a contractor, or does the contractor have to obtain and submit a separate Form A2 for us to exempt them from service tax in our billing.
To file Form A-1 at Sez for srvice Tax Exemption for the service providing vendor’s as well as DTA services as per the LOA pls. comment on the doc. required for
IN THE CASE OF ONE UNIT SEZ AND ANOTHER IS DOMESTIC TARIFF AREA,UPFRONT EXEMPTION CAN BE AVAIL ON THE BASIS OF TURNOVER RATIO, MY Q.IS WHAT TIME PERIOD TURNOVER RATIO IS CONSDER
WHAT IS TIME LIMIT FOR RENEW FORM A2 UPFRONT METHOD FOR CLAIMING SEZ EXEMPTION
Good one