Elegibility for exemption under service tax

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This query is : Resolved

AMRUT PISE (Querist)

17 April 2013 Dear all,

My client is registered under "Industrial Construction Service" & rendering the services to local Government bodies such ZP, Police Dept, Govt Education institutions in which land cost is not included.

As per notification 26/2012 for this service abatement of 75%/70% cannot be claimed as land is not included.

Now my questions are-
1.Whether he need to amend the registration & get registered under Works contract in order to charge Service Tax @ 4.944%.

2.Whether he will get exemption of the services rendered to above Govt. local bodies?

3.Whether he will get input service tax credit on services given by another works contractor & that service provider also charging the service tax @ 4.944% in his invoices?

Thanks.

Gorav Kumar Goyal

Gorav Kumar Goyal (Expert)

18 April 2013 Exemption is given in notification 25/2012 for following services:-

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;

1. Specifically excluded industrial services.

So registration needs to be amended.

2. Find out true nature of services provided as given in notification.

3. Cenvat can be taken only if Services fall under Input services definition.
Most
Input services.... specifically excludes...
7[but excludes],-

28[(A) service portion in the execution of a works contract and construction services including service listed under clause (b) of section 66E of the Finance Act (hereinafter referred as specified services) in so far as they are used for -

(a) construction or execution of works contract of a building or a civil structure or a part thereof; or

(b) laying of foundation or making of structures for support of capital goods,

except for the provision of one or more of the specified services; or]

Specified defined under section 66E

CA. Gorav Kumar Goyal
9910357301

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