Levy of service tax on representational services to business entities expands taxable legal services, subject to thresholds and credits.
The Finance Bill, 2011 extends service tax to representational services before Courts, Tribunals or Authorities when supplied to a Business Entity, while excluding services between individuals. Tax liability arises only after the prescribed threshold for taxable receipts is exceeded; registration is required once the statutory registration trigger for taxable output services is reached. The amendment takes effect on the date notified after enactment. Providers may claim CENVAT credit for input services, with full credit contingent on maintaining separate accounts for taxable and non taxable supplies or otherwise following apportionment rules. (AI Summary)