We have with us extensive experience
in handling the demands of Service Tax Consultancy services that comprise
areas like –
- Service Tax Registration
- Consultancy on Services as per the applicability of Service tax Act
- Filing of Service Tax returns in ST-3
- Consultancy on deposit of monthly service tax of corporate and
- Maintenance of Service Tax Records
- Liasioning with respective Authorities
Here, our rich experience
allows us to successfully handle all matters pertaining to services
including handling of departmental audits. Working in close relation with
client organizations, we analyze their needs and based on that perform
execution of services, thus ensuring best possible service support is
offered from our end. Some of the factors that distinguish us from others
- Rich experience in the field
- Capability to offer prompt and reliable services
- Preparation of returns & challans
- Handling departmental audit
- Regarding credit claims
What is Service ?
'Service' has been defined and means
-any activity for consideration carried out by a person for another and
includes a declared service.
The said definition further provides that 'Service' does not include
To determine whether you are providing a 'Service'
- Any activity that constitutes only
- A transfer in title of goods or immovable property by way of sale,
gift or in any other manner or
- A transfer, delivery or supply of goods which is deemed to be a sale
of goods within the meaning of clause (29A) of article 366 of the
- A transaction only in money or actionable claim
- A service provided by an employee to an employer in the course of
- Fees payable to a court or a tribunal set up under a law for the time
being in force
following questions to yourself
||Am I doing an activity (including, but not limited to,
an activity specified in section 65E of the Act) for another person*?
||Am I doing such activity for a consideration?
||Does this activity consist only of transfer of title
in goods or immovable property by way of sale, gift or in any other
||Does this activity constitute only a transfer,
delivery or supply of goods which is deemed to be a sale of goods within
the meaning of clause (29A) of article 366 of the Constitution
||Does this activity consist only of a transaction in
money or actionable claim?
||Is the consideration for the activity in the nature of
court fees for a court or a tribunal?
||Is such an activity in the nature of a service
provided by an employee of such person in the course of employment?
||Is the activity covered in any of the categories
specified in Explanation 1 or Explanation 2 to clause (44) of section
65B of the Act
[*if you are a person doing business
through an establishment located in the taxable territory and another
establishment located in non taxable territory OR a association or body of
persons or a member thereof then please see Explanation 3 to clause (44) of
section 65B of the Act before answering this question]
If the answer to the above questions is as per the answers indicated in
column 2 of the table above THEN you are providing a service.
Taxability of a
The taxability of services or the charge of service tax has been specified
in section 66B of the Act. To be a taxable a service should be - provided or
agreed to be provided by a person to another in the taxable territory and
should not be specified in the negative list.
The phrase "agreed to be provided" has been retained from the
definition of taxable service as contained in the erstwhile clause (105) of
section 65 of the Act. The implications of this phrase are.
Services which have only been agreed to be provided but are yet to be
provided are taxable Receipt of advances for services agreed to be provided
become taxable before the actual provision of service
Advances that are retained by the service provider in the event of
cancellation of contract of service by the service receiver become taxable
as these represent consideration for a service that was agreed to be
In terms of Section 66B of the Act, service tax will be leviable on all
services provided in the taxable territory by a person to another for a
consideration other than the services specified in the negative list. The
services specified in the negative list therefore go out of the ambit of
chargeability of service tax. The negative list of service is specified in
the Act itself in Section 66D. In all, there are seventeen heads of services
that have been specified in the negative list.
- Services provided by Government or local authority
- Services provided by Reserve Bank of India
- Services by a foreign diplomatic mission located in India
- Services relating to agriculture or agricultural produce.
- Trading of goods
- Processes amounting to manufacture or production of goods
- Selling of space or time slots for advertisements other than
advertisements broadcast by radio or television
- Access to a road or a bridge on payment of toll charges
- Betting, gambling or lottery
- Entry to Entertainment Events and Access to Amusement Facilities
- Transmission or distribution of electricity
- Specified services relating to education
- Services by way of renting of residential dwelling for use as
- Financial activity
- Services relating to transportation of passengers
- Service relating to transportation of goods
- Funeral, burial, crematorium or mortuary services including
transportation of the deceased
In the definition of 'service' contained in clause (44) of section 65B of
the Act it has also been stated that service includes a declared service.
The phrase 'declared service' is also defined in the said section as an
activity carried out by a person for another for consideration and specified
in section 66E of the Act. The following nine activities have been specified
in section 66E:
1. Renting of immovable property;
2. Construction of a complex, building, civil structure or a part
thereof, including a complex or building intended for sale to a buyer,
wholly or partly, except where the entire consideration is received after
issuance of certificate of completion by a competent authority;
3. Temporary transfer or permitting the use or enjoyment of any
intellectual property right;
4. Development, design, programming, customization, adaptation, up
gradation, enhancement, implementation of information technology software;
5. Agreeing to the obligation to refrain from an act, or to
tolerate an act or a situation, or to do an act;
6. Transfer of goods by way of hiring, leasing, licensing or any
such manner without transfer of right to use such goods;
7. Activities in relation to delivery of goods on hire purchase or
any system of payment by installments;
8. Service portion in execution of a works contract;
9. Service portion in an activity wherein goods, being food or any
other article of human consumption or any drink (whether or not
intoxicating) is supplied in any manner as part of the activity.
Under the present system there are 88 exemption notifications. The need for
exemptions is not obviated with the introduction of negative list. While
some existing exemptions have been built into the negative list, others,
wherever necessary, have been retained as exemptions. In addition some new
exemptions are also proposed to be introduced. For ease of reference and
simplicity most of the exemptions are now a part of one single mega
exemption notification 25/2012-ST dated 20/6/12
With effect from 1.7.2012 a new scheme of taxation is being brought into
effect whereby the liability of payment of service tax shall be both on the
service provider and the service recipient. Usually such liability is
affixed either on the service provider or the service recipient, but in
specified services and in specified conditions, such liability shall be on
both the service provider and the service recipient.
The enabling provision has been provided by insertion of Proviso to section
68 in the Finance Act, 2012 as per which Central Government may notify the
service and the extent of service tax which shall be payable by such person
and the provisions of Chapter V shall apply to such person to the extent so
specified and the remaining part of the service tax shall be paid by the
service provider. Under this clause the Central government has issued
notification no. 30/ 2012 dated 20.6.2012 notifying the description of
specified services when provided in the manner so specified where part of
the service tax has to be paid by the service receiver. The extent to which
tax liability has to be discharged by the service receiver has also been
specified in the said notification.
The manner of operation of the reverse charge mechanism has been explained
in this point.
Export of Services
Export of services shall now be governed by new provisions in the Service
Tax Rules 1994, namely Rule 6A. The essential requisites before a service
can be designated as export service are:
- It must be a service as defined under sub-section 44 of section 65B
- By a service provider located in the taxable territory
- To a service receiver is located outside India
- The service is not a service specified in the negative list
- The place of provision of the service is outside India
- The payment for such service is received by the service provider in
convertible foreign exchange
- The service provider and service receiver are not merely
establishments of a distinct person by virtue of item (b) of Explanation
2 of clause 44 of section 65B of the Act
Mukesh Raj & Company provide New
Service Tax Regime
Review of Existing
and Proposed Business Transactions
- Review of existing and proposed business transactions from the
perspective of new service tax law with a view to achieve the following
key objectives :-
- Analyse the new service tax provisions and mapping the same with the
Company business operations;
- Review of service agreement ( covering both input and out legs) from
the perspective of new service tax law;
- Identify gaps and / or areas of improvements, if any and suggest
- Verify other commercial agreements and and expenditure schedules
including expenditure in foreign currency to flag the additional service
tax liability if any under the new service tax regime;
- Revisit the business operation to explore the avenues to improve tax
Conduct Workshop to
Create the Awareness on the basis of outcomes of phase-1
We will conduct a full day workshop to discuss our observations and also to
make the people aware of the changes which will have impact on their
Compliance Outsourcing on going basis
Outsourcing Compliance Services (on-going)
Client can seeks assistance of the MRC to supplement the efforts of its
in-house personnel in the areas of service tax matters.
||Areas of compliance
||Services to be provided
||Assistance in computation of tax payable
||Assistance in computation of tax payable as per
the relevant provisions in the service tax laws. This activity will
Assisting in collating the data for output (including data for payment
of service tax under reverse charge basis) and input services (month
wise) for computation of tax liability;
Reviews of the data collated and compute the tax liability taking into
consideration the applicable deductions, exemptions and calculation of
service tax, cess and E cess.
Examining and calculating set off / input tax credit to ascertain the
Intimating the Company of the service tax liability payable and
assistance in making the payment of service tax to the authority.
Preparation of the service tax challan.
Review the service tax exemption/ abatement adopted by the management
for various services and provide our comments on the same.
Please NOTE : MRC shall rely upon the entries passed in the
Books of Accounts by the Company with respect to Service Tax Liability
and input tax credit for set off
||Assistance in filing of returns
||Assistance in filing of returns as per the
relevant provisions of the service tax law:
Preparation of service tax returns on half yearly basis ( to become
Filing of the service tax return
||Assistance with respect to Assessment proceedings
||Assistance during service tax assessments (first
level), comprises of:
Assistance in collating information and preparation of Assessment
Representations before the authorities, and attend the assessment
proceedings if required; and
Review and analyze assessment orders issued by the service tax
authorities and discuss the possible future course of action such as
||Assistance in relation to service tax audit
||Assist company in preparation to response to audit
query. Attend the audit to clarify the doubts of the auditor.
||Other compliance related services
||Meeting at client office periodically (monthly /
quarterly) to discuss and update client on the tax consequences of the
new developments, etc in connection with service tax matters enumerated
Advising on the tax consequences of budgetary changes and other
amendments in the service tax legislation that may affect their tax
payments or filing of returns;
Assistance in undertaking compliance formalities with respect to
intimation to the department for any additional place of business /
change in Authorised signatory in the identified states.
The services rendered by us will
eventually help client primarily in:
- Reducing the overall cost of handling compliance work.
- Single window service tax compliance service with sustained quality.
- To ensure smooth co-ordination with the service tax authorities.
On Call Advisory
- Advice on the issue raised by client pertaining to service tax
- Advise on the other issues as and when raised by client pertaining
to service tax implications.
- Assist in drafting reply to departmental queries, demand notices,
show cause notices etc.
- Assist in drafting appeals upto first and second appellate level.
- Represent before the various service tax appellate authorities.