Service tax on mutual fund loads denied; AMC fund management fees and related distributor services remain taxable.
Entry and exit load levied by a mutual fund are not subject to service tax because they meet initial issue and scheme expenses and are not payment for fund management; by contrast the AMC's recurring investment and advisory fee for fund/asset management and services provided by distributors, brokers, custodians and trustees are taxable under their respective service categories.

Service tax circular withdrawal: obsolete guidance rescinded and valuation governed strictly by Determination of Value Rules.
A review of long standing service tax circulars resulted in the immediate withdrawal of a specified list of circulars that are obsolete or anachronistic. Portions of other circulars inconsistent with the Service Tax (Determination of Value) Rules, 2006 have already been withdrawn, and valuation of taxable services must be determined under those Rules read with section 67 of the Finance Act, 1994; remaining portions are under Board examination.

Service tax exemption for resident welfare associations depends on membership being residents and a per-member monthly cap.
Exemption applies to resident welfare associations registered as co-operative societies that provide specified taxable services to their members, provided membership is limited solely to residents of the complex or locality and the association's receipts from any individual member for those services do not exceed the notification's per-member monthly cap.

Secondary and Higher Education Cess to be provisionally recorded under Receipt Awaiting Transfer pending new heads of account.
Collections of the new Secondary and Higher Education Cess of 1% on excisable goods, imports and taxable services must be provisionally accounted under the Minor Head "Receipt Awaiting Transfer" (RAT) within the Major Heads for Customs, Union Excise Duty and Service Tax using the specified codes; amounts held under RAT will be transferred to the new Head of Account when opened by the Controller General of Accounts.

Secondary and Higher Education Cess use existing e payment education cess code pending new account head; bifurcate amounts in remarks.
Pending opening of a separate Head of Account for the Secondary and Higher Education Cess introduced in Budget 2007, collections made through e-payment are to be booked under the existing Education Cess code; online challans must show the bifurcated amounts for Education Cess and Secondary and Higher Education Cess separately in the remarks column.

Service Tax return format revised: new Form ST-3 mandates expanded disclosures, e filing compatibility, and LTU-specific entries.
Revision mandates all taxpayers to adopt the revised Form ST-3, reflecting LTU procedural changes, recent law amendments, and enhanced return-scrutiny information. The form supports e filing, provides detailed annexed instructions, separates computation by taxable service while consolidating payment details, introduces a premises code for jurisdictional identification, and includes entries for valuation of exported/imported services, self adjustment of excess tax, LTU-specific information, rate-wise value breakups, and fields for education cess when applicable.

Service tax abatement for tour operators extended retroactively, limiting taxable portion of gross receipts for passenger transport services.
Central Government, via Notification No. 15/2007 under Section 11C, exempted levy of service tax on 60% of the gross amount charged for taxable services by tour operators operating under a contract carriage permit for intercity passenger transport (excluding package tours) for the period 1-4-2000 to 4-2-2004, extending the benefit of the 60% abatement retrospectively in response to representations that operators had been taxed on 100% of gross receipts.

Reconstitution of advisory and grievance committees mandates inclusive representation for newly taxable services and wide publicity.
Reconstitution of the Regional Advisory Committee and Public Grievance Committee is directed to hold regular meetings with the Commissioner of Service Tax, Delhi to secure proper representation from all service categories following introduction of new taxable services, and requires wide publicity and notification to specified administrative and industry addressees for implementation.

Service tax return revision introduces e-filing compatibility and new entries for self-adjustment, large taxpayers, and premises code.
The ST-3 Service Tax return has been revised for automation and e filing, with detailed filling instructions and incorporation of recent legal and procedural changes. The form adds a dedicated entry for self adjustment of excess tax paid, separate fields for Large Taxpayer Unit information, distinct computation entries per taxable service with a consolidated payment schedule, and a new premises code to facilitate jurisdictional identification; entries for an education cess will apply after enactment of the Finance Bill.

Mandatory e-payment of service tax for large taxpayers requires using designated banks authorised to accept online payments.
E-payment of service tax is mandated for assessees meeting the large taxpayer threshold, with Cenvat utilization included for that calculation. Prerequisites, the procedure for electronic payment, and modes of receipt are provided in annexures. A list of twenty-six banks is published authorizing them to collect Central Excise duties and service tax via internet banking for specified commissionerates, with most banks authorised for all commissionerates and several authorised only for selected commissionerates.

Service tax registration surrender: procedure requires immediate ST-2 return, prescribed undertaking, and confirmation of tax compliance.
Registered service providers who cease to provide taxable services or who opt for exemption must immediately surrender their ST-2 registration certificate to the Superintendent of Service Tax. Surrender is effected by filing the prescribed undertaking in the enclosed proforma with the original certificate, confirming payment of service tax, education cess and interest, no outstanding government liabilities, filing of half-yearly returns, and disclosure of annual turnover. The undertaking binds the declarant to pay any subsequently found government dues with interest on demand.

Turnover-based exemption from service tax means exempt providers need not file ST-3 returns and should deregister.
Filing obligation for ST-3 returns applies only to persons liable to pay service tax; by definition an assessee is a person so liable. Service providers not liable due to the turnover-based exemption are not required to file ST-3 returns and are advised to seek deregistration to avoid show cause notices.

Mandatory e-payment of Central Excise duty: electronic deposit via internet banking required for threshold assessees, with online challan procedure.
Assessees meeting the prescribed previous-year duty threshold must deposit Central Excise and Service Tax electronically via Internet banking through authorized banks. The facility applies to registered PAN-based assessees who are customers of participating banks and have Internet banking IDs; the online process requires completion and submission of an electronic challan, secured bank authentication, account selection and payment authorization. An immediate cyber receipt is generated and receipted challan copies are later delivered by the bank for tax returns and records.

Mandatory electronic payment of service tax requires online deposit and use of the new single-copy challan under the EASIEST scheme.
The EASIEST regime mandates use of a new single-copy challan for Central Excise and Service Tax and requires assessees exceeding the prescribed prior-year duty threshold to deposit duty electronically via authorised internet banking; taxpayers are directed to annexures and official websites for challan access, bank lists, and operational guidance.

Money changing not treated as foreign exchange broking; service tax not leviable on direct forex sale and purchase.
Money changing is the direct sale and purchase of foreign currency where the money changer holds title, and thus does not constitute foreign exchange broking; foreign exchange broking is an intermediary commission-based activity without taking title. Accordingly, service tax classified under banking and other financial services is not leviable on money changing per se, and the circular supersedes the prior departmental instruction.

Interconnection usage charges: taxable once telecommunication service definition amended; not taxable for prior period by law.
IUC charged by one telegraph authority to another is not taxable under pre-amendment telephone service rules because it is not provided to a subscriber; Law Ministry and Attorney General concurred. The Finance Bill amends the definition of telecommunication service to include IUC and make such services taxable when the amendment is notified. Until that commencement date, service tax does not apply to IUC and contrary circulars are withdrawn.

Exemption for goods transport by road service: payer liable for tax can claim exemption if conditions and declaration are met.
Exemption from service tax for goods transport by road service provided by a goods transport agency is available subject to conditions that no credit of duty on inputs or capital goods has been taken and that benefit under an alternative notification has not been availed; where the payer of freight is made liable to pay service tax, that person may avail the exemption if the conditions are met and the service provider gives a declaration on the consignment note in accordance with the prescribed procedure.

Small Service Provider Exemption increased; qualifying providers may surrender registration after filing returns and paying dues.
Increase in the threshold for the Small Service Provider Exemption and exemption from registration takes effect from 1-4-2007, subject to notification conditions. Qualifying providers who opt for exemption may surrender their Service Tax Registration Certificate after filing all half-yearly ST-3 returns up to 31-3-2007 and after paying all service tax dues. The circular provides an application format and requires the Registration Certificate number, service category, reason for surrender, and enclosures of ST-3 filing acknowledgements.

Service tax threshold increase and scope expansion broaden taxable services and clarify credit and registration rules.
A cess on service tax is introduced with input credit for cess; the Finance Bill widens taxable services to include telecommunication, mining, commercial immovable property renting, works contract service components, content development for telecom, asset and fund management, and broader design services, consolidates telecommunication subcategories into a single definition, and clarifies or renames numerous existing service categories while adding definitions for key terms.

Widening of service tax base expands taxable services and adjusts thresholds, definitions, exemptions and compliance rules.
The Finance Bill expands the service tax base and adjusts thresholds: it raises exemption and registration limits for small providers, consolidates and newly specifies taxable services-notably telecommunication, mining, renting of immovable property for business, works contract services (with valuation rules and optional composition), content development for telecom/advertising/internet, non-banking asset/fund management, and design services-and amends definitions, exclusions and procedural rules. New targeted exemptions (RWAs, incubators/incubatees, CRO clinical trials, and digital cinema delivery) and amendments to CENVAT, export rules, registration, return revision and reverse-charge mechanisms are also provided.