Miscellaneous issues relating to the services on which service tax has been imposed with effect from

Taxability of installation services clarified: machinery installation is taxable while routine fittings and exempt individual providers are excluded.

Commissioning or installation of machinery or equipment that makes the item operational is taxable, while routine residential fittings are not. Installation services by individuals are exempt. For combined supply and installation contracts an optional composite valuation allows charging service tax on one third of the gross contract value including supplied parts, subject to non application of other exemptions. IT services are excluded only when the service is primarily in relation to computer system operation; incidental use of computers in business processing does not qualify for exclusion. Maintenance or repair rendered before the levy date is not taxable; certain computer maintenance is exempt. Foreign exchange broking by authorized dealers is taxable. If a service is supplied free, tax applies only if value is assigned.