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Miscellaneous issues relating to the services on which service tax has been imposed with effect from

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....heaters etc. will be chargeable to service tax. 1.2 As commonly understood, the activity of installation means the act of putting an equipment, machinery or plant into its place and making it ready for use. The activity of installation will start after erection which would refer to putting up civil structures. Commissioning of a plant would mean operationalising an installed plant/equipment/machinery. In this backdrop it is clarified that putting up a water tank, piping, electric wiring, in a residential premises etc. would not be covered in the definition of taxable service and thus would not be taxable. However, installing a booster pump, air-conditioner, water filter, water heater etc. would be covered in the definition and be taxable, ....

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....in the first bullet the sentence "It is submitted that it has been provided in law that service tax is leviable on erection and commissioning charges only and not on the material and goods supplied." may be read as "It is clarified that it has been provided in law that service tax is leviable on commissioning or installation charges only and not on the material and goods supplied." 2. Scope of IT service under Business Auxiliary Service: 2.1 The definition of Business Auxiliary Service in the law excludes the Information Technology (IT) services. As per the definition IT service means any service in relation to designing, developing or maintaining of computer software or computerized data processing or system networking or any other servi....

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....n to operation of computer systems. The last words "primarily in relation to operation of computer systems" make the intention abundantly clear. The words "back office processing" used in the clarification dated 28-2-2003 have to be read in conjunction with the other terms used therein viz. data processing, networking, computer facility management. Thus any service of back office processing primarily in relation to operation of computer system will be covered as IT services and not taxable. Payroll-processing, accounts management etc. even by using computer programs, can not be termed as activities primarily in relation to computer systems. The use of computer in these services is secondary and the primary activity is that of business-relat....

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....d by money changers, a doubt has been raised whether all trading in foreign exchange will be chargeable to service tax. 4.2 Prior to 1-7-2003 the service of "securities and foreign exchange (forex) broking", when provided by banking company/financial institution/body corporate was liable to service tax. Through Finance Act, 2003 "foreign exchange broking" when provided by foreign exchange brokers, other than banking company/financial institution/body corporate, were also brought under the tax net w.e.f 1-7-2003. As per the definition in law foreign exchange brokers include authorized dealers of foreign exchange. Authorised dealer of foreign exchange has been assigned the meaning of "authorized person" under the FEMA, 1999. Accordingly auth....