Transition Provision

[Admin TMI]

Question - What are proposed transitional provision in service tax in Finance Bill 2015 ?

[Admin TMI]

A new section 78 B is being inserted to prescribe, by way of a transition provision, that,-

(i) amended provisions of section 76 and 78 shall apply to cases where either no notice is served, or notice is served under sub-section (1) of section 73 or proviso thereto but no order has been issued under sub-section (2) of section 73, before the date of enactment of the Finance Bill, 2015; and

(ii) in respect of cases covered by sub-section (4A) of section 73, if no notice is served, or notice is served under sub-section (1) of section 73 or proviso thereto but no order has been issued under sub-section (2) of section 73, before the date of enactment of the Finance Bill, 2015, penalty shall not exceed 50% of the service tax amount.

AI Summary

Transitional provision in service tax: amended notice-and-order rules apply; penalty capped at half of the tax demand.
The transitional provision applies the amended procedural provisions to cases where no notice was served, or a notice under the primary notice route was served but no subsequent order issued before enactment; for specified charging-provision cases meeting the same timing conditions, penalty exposure is limited by a cap equal to half of the assessed service tax amount.