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Understanding Service Tax Concepts

 

By

 

CA. Madhukar N Hiregange

 

CA. Sudhir V S

 

CHAPTER 1.

 

OVERVIEW OF SERVICE TAX

 

Constitutional validity and concepts

Levy and collection

Concept of Classification

Registration

Concept of consideration and valuation2

Payment of service tax

Cenvat Credit scheme

Export of Services

Filing of returns

Assessment

Provisions as to recovery

Provisions pertaining to penalty

Provisions pertaining to Appeals

 

CHAPTER 2.

 

SERVICE TAX - LEVY

 

CHAPTER 3.

 

CLASSIFICATION OF SERVICES

 

 

Relevance of the concept of classification

Possible ramifications where the assessee gets the classification wrong

Relevant case laws .

 

CHAPTER 4.

 

CENVAT CREDITS AND PAYMENTS

 

 

Duties/taxes which can be considered for set off or availing credits

Utilisation of the credits

When inputs/capital goods are removed outside the premises

Restriction in case of capital goods

Can the inputs or capital goods on which cenvat credit is claimed, be sent out to a sub contractor for processing?

Cenvat Credits – Refund for exporter of service/ SEZ/ EOU

Where the service provider has both taxable as well as exempted services

Can Cenvat credits be transferred?

Can credits be taken on inputs and capital goods received under invoice, bill or challan issued by another office of service provider?

Confiscation and penalty in case of wrong availment of Cenvat Credits

Provision for recovery of credits wrongly availed .

Concept of input service distributor

 

CHAPTER 5.

 

VALUATION UNDER SERVICE TAX

 

 

What is the main basis for valuation?

Can the Central Excise Officer question the valuation?

Whether the gross amount charged for the service would include charges reimbursed by the service receiver?  

Are there any other specific inclusions and exclusions with regard to amount charged for specific services?

Exclusions with regard to the amount charged:-

Where during the course of providing service, there is transfer of property in goods, what would be the value? .

 

CHAPTER 6.

 

EXEMPTIONS AVAILABLE UNDER SERVICE TAX

 

Is there an exemption available generally to all service providers exempting value of services up to a certain limit?

Is there any exemption from service tax where the service provider transfers property in goods during the course of provision of services?

Is there any other exemption available which can also be used in a scenario where the value of materials/goods sold cannot be quantified or ascertained separately?

Exemption on services provided to a developer of Special Economic Zone or a Unit of a Special Economic Zone

Certain other specific exemptions –

 

CHAPTER 7.

 

IMPORT AND EXPORT OF SERVICES

 

When is a service said to have been imported into the country for the purpose of taxing the same in the hands of the service receiver?

What would be the position where an entity has establishments in India as well as abroad and the entity abroad provides services to the Indian unit?

What do the Taxation of Services (Provided from outside India and Received in India) Rules 2006 say?

Provisions in case of export of services

 

 

CHAPTER 8.

 

REFUNDS AND REBATES

 

How does the refund work?

Refund under notification 17/2009 – Available to exporters of goods in respect of specified input services

Refund under notification 43/2007-ST-Available to manufacturers of specified goods in respect of business exhibition service

Procedure under sec 11B – Refund of cenvat credits/service tax paid in excess

How does the scheme of rebate work?

Rebate of the service tax on taxable services exported

Rebate of the service tax on input services or duty on inputs

 

 

CHAPTER 9.

 

DEMANDS AND APPEALS

 

 

What happens when there is a short levy or short payment of tax or erroneous refund?

What happens when the service provider has collected service tax in excess of the amounts to be collected from the service receiver?

What is the interest for delay in payment or in cases where amounts have been collected in excess from customers?

Is provisional attachment of property possible?

Can mistakes apparent from record be rectified?

Can an order be revised by the Commissioner of Central Excise?

Where the assessee is aggrieved by the order of an authority subordinate to Commissioner of Central Excise, where would the appeal be made?

When shall the appeal be with the Appellate Tribunal?

 

 

CHAPTER 10.

 

PROCEDURES WITH REGARD TO REGISTRATION

 

 

What is the procedure for registration?

How to make amendments with regard to changes in particulars?

 

CHAPTER 11.

 

PROCEDURE WITH REGARD TO INVOICING

 

 

How to raise a proper invoice? .

 

 

CHAPTER 12.

 

RECORD KEEPING

 

 

 

CHAPTER 13.

 

PAYMENT OF SERVICE TAX

 

 

How to pay service tax? 9

 

 

CHAPTER 14.

 

SERVICE TAX RETURNS

 

 

CHAPTER 15.

 

SERVICE TAX AUDITS BY PROFESSIONALS

 

 

 

 

CHAPTER 16.

 

FREQUENT ERRORS COMMITTED IN SERVICE TAX

 

 

 

 

CHAPTER 17.

 

OTHER MISCELLANEOUS ASPECTS IN SERVICE TAX

 

 

Interest and penalty calculations

Provisions as to penalty  

Searching of premises by authorized officers

Other recovery provisions

Application of the provisions of the Central Excise Act 1944

The professional who advises on service tax should be aware of the implications of the above provisions which maybe judicially clear as they have gone through a number of years of modifications.

 

 

CHAPTER 18.

 

SOME OF THE IMPORTANT COMMON SERVICES

 

 

Renting of Immovable Property Services

Management, Maintenance or Repair Services

Information Technology Software Services

Goods Transport Agency Services

Construction Related Services

Business Auxiliary/Support Services of Business or Commerce

 

 

CHAPTER 19

TABLE OF SERVICES TAXABLE U/S 65(105)

 

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Category Service Tax, Other Articles by - Madhukar N Hiregange 



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