Circular No. 115/09/2009 - ST dated 31-7-2009 has been issued by the CBEC to clarify that:

"The remunerations paid to Managing Director / Directors of companies whether whole-time or independent when being compensated for their performance as Managing Director/Directors would not be liable to service tax."

But, this circular is not new, the same position has been clarified by the Commissioner of Central Excise, Madurai,  vide Trade Notice No, 15/2009; Service Tax No. 7/2009, dated 13-3-2009

It happens rarely that commissioner of central excise clarifies an issue before the board.

Service tax exclusion for director remuneration confirmed; payments for duties as directors are not taxable. The CBEC clarified that remunerations or commissions paid to Managing Directors and other directors, whether whole-time or independent, for performance of their director duties are not liable to service tax; this position reiterated a prior regional clarification by the Commissioner of Central Excise, Madurai.