Applicability of service tax

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Querist : Anonymous

Querist : Anonymous (Querist)

14 July 2012 Is service tax applicable on construction work for Indian Tibbat Border Police through National Buildings Construction Corporation.

PUNEET GOYAL

PUNEET GOYAL (Expert)
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14 July 2012 In respect of your query there are two important things i.e.
1. Whether services are provided by Government
2. Whether services are provided to Government

1. Whether services are provided by Government
Services provided by Government are covered by negative list accordingly it is not taxable at all and relevant provision are as under

66D. The negative list shall comprise of the following services, namely:––
(a) services by Government or a local authority excluding the following services to the extent they are not covered elsewhere—
(i) services by the Department of Posts by way of speed post, express parcel post, life insurance and agency services provided to a person other than Government; (SPLA)
(ii) services in relation to an aircraft or a vessel, inside or outside the precincts of a port or an airport;
(iii) transport of goods or passengers; or
(iv) support services, other than services covered under clauses (i) to (iii) above, provided to business entities;

2. Whether services are provided to Government
These services are exempted by way of mega exemption notification i.e. NN 25/2012
Relevant provisions are as under:
12. Services provided to the Government, a local authority or a governmental authority by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of -
(a) a civil structure or any other original works meant predominantly for use other than for commerce, industry, or any other business or profession;
(b) a historical monument, archaeological site or remains of national importance, archaeological excavation, or antiquity specified under the Ancient Monuments and Archaeological Sites and Remains Act, 1958 (24 of 1958);
(c) a structure meant predominantly for use as (i) an educational, (ii) a clinical, or (iii) an art or cultural establishment;
(d) canal, dam or other irrigation works;
(e) pipeline, conduit or plant for (i) water supply (ii) water treatment, or (iii) sewerage treatment or disposal; or
(f) a residential complex predominantly meant for self-use or the use of their employees or other persons specified in the Explanation 1 to clause 44 of section 65 B of the said Act;
You may also refer clause no. 13 & 14 of said notification for other services provided to Govt.

On the basis of above provision it appears that your case falls under second category and exempted.
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