Maintenance and repair services provided to railways

[Praveen Kumar]

Dear readers, does providing repair and maintenance services in respect of railway wagons to railways / RITES etc., fall under 'MMRS' and liable to service tax? Can exemption be claimed under Notification No.24/2009-ST as amended by 54/2010-ST or under Mega notification no.25/2012-ST? Or any other exemption notification...please advise.

[Padmanaban M]

Hi Mr. Praveen Kumar,

Repair and Maintenance work for railways are not exempted from the Service Tax.  As per the mega exemption notification (25/2012) only the original work is exempted for Railways, roads etc.,  The original work meaning is given below:

Explanation 1.- For the purposes of this rule,-

(a)  "original works" means-

(i)  all new constructions;

(ii)  all types of additions and alterations to abandoned or damaged structures on land that are required to make them workable;

(iii)  erection, commissioning or installation of plant, machinery or equipment or structures, whether pre-fabricated or otherwise;

As refer by you the principal notification of 24/2009 was rescinded vide notification no 34/2012 - Dt. 20.06.12, hence the said notification is not valid now.

So, the Railways are not exempted for Repair and Maintenance work.

M.Padmanaban

[Praveen Kumar]

Hi Shri M.Padmanaban,

Wish you a Happy New Year and thank you for the prompt reply. Would I be right in assuming that the said service was exempted prior to the rescinding of the Notification No.24/2009-ST?

The Notification No.24/2009-ST as amended by 54/2010-ST exempts MMRS services in respect of roads, railways etc. Now, does the word 'railways' include all railway property (Indian Railways as a whole) or only the railway lines and related paraphernalia like signals, electric lines etc. (excluding rolling stock)?

Thank you once again.

Praveen Kumar

AI Summary

Repair and Maintenance of Railway Wagons Not Exempt from Service Tax Under Mega Exemption Notification 25/2012 A participant inquired whether repair and maintenance services for railway wagons are subject to service tax or exempt under specific notifications. A respondent clarified that such services are not exempt, as the mega exemption notification (25/2012) only covers original works like new constructions and installations. The earlier exemption under Notification No.24/2009-ST was rescinded in 2012, making it invalid. The inquirer further questioned whether the exemption previously applied to all railway properties or just specific components, seeking clarification on the scope of the term 'railways' in the context of exemptions.