Service tax on Services of Operation and Maintenance of Sewage Treatment Plant

[RAKESH TOMAR]

Dear sir,

Thanks for your reply. I would also like to request your goodself to let me know whether the maintenance of immovable properties (as mentioned by you) of Sewage Treatment Plant under Local Bodies ( Civil Construction, structures and Equipment needed to operate the STP like pumps, D.G. Set, Electrical Sub-station etc.) will fall under the purview of service tax.

[Madhukar N Hiregange]

Matter not clear. Should not  due to entry 39 of the mega exemption - services by a govt authority by way of functions entrusted to municipality ...Read with 29 h) sub contractor providing services by way of works contract to another works contractor providing services which are exempt.  

Representation prior to next budget may solve this open issue. In meantime write under speed post to dept and confirm your understanding.

AI Summary

Service tax exemption uncertainty: maintenance services for sewage treatment plants may fall within government/works contract exemptions.
Applicability of service tax to operation and maintenance of an STP, including maintenance of immovable property and equipment, is uncertain; potential reliance is placed on the mega exemption for government authority services related to municipal functions and on the exemption for subcontractors to works contractors, and the correspondent is advised to make a formal representation and seek written departmental confirmation.