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Service provided to local authority

ATIT D SHAH (Article cum C.A. ) (142 Points)

01 January 2013

Urgent

Whether Service tax is applicable on services provided to Municipal corporations by way of Supply Erection Testing & Commissioning of new street light poles ? before Negative list came in existence ! i.e. before 01.07.2012

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4 Replies

Madhukar N Hiregange (Chartered Accountant) (39039 Points)
Replied 02 January 2013

The composite contract ofmaterialand albour would be classified under WC prior to 1.7.2012. Only for civil strcutures/ bldgs the exclusion for non profit entities is there. For the entry of erection it is not. Therefore prima facie appears to beliable.

However could the activity be considered as part of raod building activity as the street lights are part of the road. If so raods are exempt.

After 1.7.2012, the same may not be liable if fitting inot sr No. 12 of Not 25/12.

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Pradip Shaw & Co (Practice) (227 Points)
Replied 05 January 2013

Service provided to a municiple corporation is exemt from service tax, because these

services are for general public and if one imposed service tax to MC,

then ultimately general public will bear it. this is not the object of the Govt.

Atit Shah (Proprietor) (130 Points)
Replied 07 January 2013

Thank you to both of u, but can u please provide me any written material or circular or notification ?

Vikas (CA) (1135 Points)
Replied 08 January 2013

In my opinion it would be taxable by virtue of Circular no. 96/7/2007-ST, Dated 23-08-2007; wherein exemption on such services that are in public interest has been extended to the public authorities only.