TaxTMI 
TaxTMI 
For kind attention of Honourable Prime Minister and Finance Minister. Meaning of services – there seems serious and fatal flaw in definition clause in GST laws
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....or kind attention of Honourable Prime Minister and Finance Minister. Meaning of services – there seems serious and fatal flaw in definition clause in GST laws<br>By: - DEVKUMAR KOTHARI<br>Goods and Services Tax - GST<br>Dated:- 2-5-2017<br><br>Relevant laws: THE CENTRAL GOODS AND SERVICES TAX ACT, 2017. In short CGST THE INTEGRATED GOODS AND SERVICES TAX ACT, 2017. In short IGST THE UNION TER....
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....RITORY GOODS AND SERVICES TAX ACT, 2017. In short UTGST THE GOODS AND SERVICES TAX (COMPENSATION TO STATES) ACT, 2017. In short GST Compensation. Common definition or meaning of "services": Definitions or meaning provided in the CGST are adopted in IGST and UTGST, unless specific definition is provided in them. We find that meaning of "services" is provided in CGST and not in IGST, UTGST and GS....
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....T Compensation. Therefore meaning of services as per CGST is applicable in IGST, UTGST, and GST Compensation. We also find that few specific services have been defined in CGST, IGST and UTGST. Relevant provisions are reproduced with highlights added: THE CENTRAL GOODS AND SERVICES TAX ACT, 2017 Definitions: (2). In this Act, unless the context otherwise requires,-- XXX (102) "services" mea....
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....ns anything other than goods, money and securities but includes activities relating to the use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged; THE INTEGRATED GOODS AND SERVICES TAX ACT, 2017 2. In this Act, unless the context otherwise requires,-- Xx (24) ....
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....words and expressions used and not defined in this Act but defined in the Central Goods and Services Tax Act, the Union Territory Goods and Services Tax Act and the Goods and Services Tax (Compensation to States) Act shall have the same meaning as assigned to them in those Acts; THE UNION TERRITORY GOODS AND SERVICES TAX ACT, 2017 2. In this Act, unless the context otherwise requires,- xxx (10....
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....) words and expressions used and not defined in this Act but defined in the Central Goods and Services Tax Act, the Integrated Goods and Services Tax Act, the State Goods and Services Tax Act, and the Goods and Services Tax (Compensation to States) Act, shall have the same meaning as assigned to them in those Acts. Analysis of meaning of Services as per S.2 (102) of CGST: "services" means anyth....
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....ing other than goods, money and securities but includes activities relating to the use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged; Analysis: Although the definition clause starts with standard sentence 'unless the context otherwise requires' , however in ....
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....relation to services we find that: * A meaning has been given by use of expression "services" means * Service means anything- this connotes that it should be thing. A service is generally not a thing. * Thing should be other than goods, money and securities. * but includes activities relating to : the use of money conversion of money by cash or by any other mode, conversion of mone....
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....y from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged; With a very limited knowledge and experience, author feels that the above meaning of services is very defective and can be fatal to valid levy of tax on most of services under regime of GST. This is because we find that primary meaning is that it should be anyth....
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....ing, then certain things are excluded, and thereafter specific type of services related with money are considered to be services, if they are provided in relation to some services related with money for which a separate charge is charged. Amendment is desirable: In view of above discussion author feels that an amendment of the meaning of Services is immediately required. In view of author this d....
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....efect in the meaning can be cured by proper amendment only and not by way of general or special order for removal of difficulties as provided in S.172, which is reproduced below: Removal of difficulties. 172. (1) If any difficulty arises in giving effect to any provisions of this Act, the Government may, on the recommendations of the Council, by a general or a special order published in the Offi....
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....cial Gazette, make such provisions not inconsistent with the provisions of this Act or the rules or regulations made thereunder, as may be necessary or expedient for the purpose of removing the said difficulty: Provided that no such order shall be made after the expiry of a period of three years from the date of commencement of this Act. (2) Every order made under this section shall be laid, as....
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.... soon as may be, after it is made, before each House of Parliament. Hope and expectation: Author hopes that he is correct and is not unaware or unconscious of any hidden aspect of meaning of services as provided in CGST Act and as discussed above. Author also hopes that Honourable Prime Minister and honourable Finance Minister and other concerned Ministers, will take immediate steps in this reg....
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....ard. Author also recall that during period when Honorable Shri P Chidambaram was the Finance Minister, some mistakes found in Finance Bills were discussed by author in his articles published in magazines and some of them were rectified in the Finance Bill, before it was passed and enacted as Finance Act. For example in respect of Tax on distributed income u/s 115O and 115R, several mistakes or l....
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....oopholes , were pointed out in articles written by the author were rectified. This may be a coincidence, but hats off to Honorable Shri P Chidambaram. Author hopes that Shri Arun Jaitely will also act quickly.<br> Scholarly articles for knowledge sharing by authors, experts, professionals ....