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Service Tax - Negative List concept
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Your efforts may fail, but never fail to make an effort
1
G.LAKSHMINARAYAN. B.COM, ACA(LLB)
GMR GROUP – Corporate Legal & Indirect Taxation
Mob:9880423839
Service Tax- Negative List concept
(CPE Study Circle meeting at Bangalore Branch of SIRC on 11.07.2012)
SERVICE TAX
Coverage:
What was it up to 30.06.2012
What is it from 01.07.2012
3
SERVICE TAX – NEGATIVE LIST CONCEPT
OBJECTIVE:
To appreciate as to
• What is service
• What is declared service
• What is Negative List
• What is works contract
• What are the exemptions available
• What is reverse charge and sharing of Service Tax
• What is new abatement scheme
• What is Point of Taxation
• What is Place of Provision of Services
UP TO 30.06.2012
No definition for the subject matter “service”
119 and above taxable services
100s of definitions of various taxable services
80 and above Exemption Notifications
Classification problems
100s of circulars to clarify the doubts(whos’?)
Amendment of Registration Certificate for every new and deletion of
services
Dispute on correlation of input vis-à-vis output services
ST-3 Return to cover the details for each category of taxable services
BUDGET 2012 - FM’S SPEECH
158.At the end of June this year, this tax will attain
adulthood by completing 18 years. It is therefore
time toshift gears and accelerate ahead. However,
service tax needs to confront two important challenges
to sustain the journey. These are:
– The share of services in taxes remains far below its
potential. There is a need to widen the tax base and strengthen its enforcement;
– Service Tax law is complex and sometimes avoidably different from Central Excise. We need to bring the two as close as possible in the light of our eventual goal of transition to GST.
I have attempted to address both these issues this year.
• 159. Last year, I had initiated a public debate on the desirability of moving towards taxation of services based on a negative list. In the debate that continued for the better part of the year, we received overwhelming support for this new concept.
• 160. Thus, I propose to tax all services except those in the negative list. The list comprises 17 heads and has been carefully drawn up, keeping in view the federal nature of our polity, the best international practices and our socio-economic requirements.
ON OR AFTER 01.07.2012
Comprehensive approach
Service is defined for the first time
Definitions are minimized
Specific taxation to Negative list concept taxation
Certain activities open for litigation are
declared as services beyond the doubt
Burden of proof of taxability of services on Revenue is minimized
Composition scheme for works contract is done away
Export and Import of services are guided by Place of provision of Services
Rules read with ST Rules.
LEVY
Charging Section 66B:
There shall be levied a tax (hereinafter referred to as the service tax) at the rate of twelve per cent on the value of all services, other than those services specified in the negative list, provided or agreed to be provided in the taxable territory by one person to another and collected in such manner as may be prescribed.
What is Taxable?
All services (Except………………..)
Jurisdiction?
Provided or agreed to be provided in Taxable Territory
Service tax on?
The value of services
WHAT IS SERVICE?
Service means:
any activity
Carried out by a person for another person
For consideration and includes declared services but shall not include
(a) any activity which constitute merely – (i) a transfer of title in goods or immovable property, by way of sale, gift or in
any other manner; or
– (ii) Deemed sale
Works Contract?
– (iii) a transaction in money or actionable claim;
Transaction in money shall not include any activity relating to the use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged.
Then can we consider the interest free loan, gift, donation or charity or financial support as a transaction in money?
WHAT IS SERVICE? (b) a provision of service by an employee to the employer in the course of or in relation to his employment;
Reimbursement of expenses to employees?
(c) fees taken in any Court or tribunal established under any law for the time being in force.
Exclusion by explanation
• Functions performed by MP/MLA/Members of Panchayat, Local authority
carrying of the functions of that office
• Duties performed by any person who holds any post in pursuance of provision
of constitution in that capacity
• Duties performed by chair person/Member/Director of a body established by
CG/SG/LA and who not deemed as employee
WHAT IS ACTIVITY?
Not defined and the Dictionary Meaning is”
The condition in which things are happening or being done: there has been a
sustained level of activity in the economy
A thing that a person or group does or has done: the firm’s marketing activities
• Origin:
late Middle English: from French activité or late Latin activitas, from Latin act- 'done', from the verb agere
Carried out by a person:
Requires an action
Even inaction is considered as an action(PASSIVE)
Refrain from an act or to tolerate an act or a situation
WHAT IS SERVICE?
Person is defined now (Section 65B(37)
Person Includes: An Indl, a HUF, a Company, a Society, an LLP, a Firm, an AOP or BOI incorporate or not, Govt, Local authority,
Artificial juridical person not falling in any of the above categories
For Another Person: Should be to a different person
Self services not taxable- Exception;
Unincorporated Assn or body of persons and members are treated as distinct persons
An establishment in taxable territory and other establishment in a non taxable territory are treated as distinct persons
WHAT IS CONSIDERATION?
Consideration: Not Defined in the Act
65B(55) “words and expressions used but not defined in this Chapter and defined in the Central Excise Act, 1944 or the rules made thereunder, shall apply, so far as may be, in relation to service tax as they apply in relation to a duty of excise.'.
Explanation (a) to Section 67
Consideration includes any amount that is payable for the taxable services provided or to be provided - Its an inclusive definition
Section 2(d) of The Indian Contract Act, 1872
Quid pro quo
Consideration may be in money or non monetary
DECLARED SERVICES
• Renting of Immovable Property
• Construction of complex, Building, Civil structure or part thereof and excludes the building or complex sold after obtaining the completion certificate
• Temporary transfer or permitting use or enjoyment of IPRs
• Development, design, programming, customisation, adaptation, up gradation, enhancement, implementation of information technology software;
• agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act;
• transfer of goods by way of hiring, leasing, licensing or in any such manner without transfer of right to use such goods;
• activities in relation to delivery of goods on hire purchase or any system of payment by instalments;
• service portion in the execution of a works contract;
• 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 a part of the activity.
Why declared services?
DECLARED SERVICES V/S DEEMED SALES
Deemed Sale Declared services Observations
(a) a tax on the transfer, otherwise
than in pursuance of a contract, of
property in any goods for cash,
deferred payment or other valuable
consideration; THE CONSTITUTION
OF INDIA 196
Not a declared services
(b) a tax on the transfer of property
in goods (whether as goods or in
some other form) involved in the
execution of a works contract;
(h) service portion in the
execution of a works
contract;
Only service portion is
taxed under service tax law
(c) a tax on the delivery of goods on
hire-purchase or any system of
payment by instalments;
(g) activities in relation to
delivery of goods on hire
purchase or any system of
payment by instalments;
Only activities in relation
to the delivery of goods is
taxed under service tax law
DECLARED SERVICES V/S DEEMED SALES
Deemed Sale Declared services Observations
(d) a tax on the transfer of the right to use any
goods for any purpose (whether or not for a
specified period) for cash, deferred payment
or other valuable consideration;
(f) transfer of goods by way of
hiring, leasing, licensing or in
any such manner without
transfer of right to use such
goods;
Transfer of goods
without transfer of
right to use them is
taxed under the
service tax law
(e) a tax on the supply of goods by any
unincorporated association or body of
persons to a member thereof for cash,
deferred payment or other valuable
consideration;
Not a Declared
service but a service
itself
(f) a tax on the supply, by way of or as part of
any service or in any other manner
whatsoever, of goods, being food or any other
article for human consumption or any drink
(whether or not intoxicating), where such
supply or service, is for cash, deferred
payment or other valuable consideration,
(i) 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 a
part of the activity.
Only service portion
is taxed under service
tax law
NEGATIVE LIST SERVICES
What is Negative List ? 65B (34) “Negative list" means the services which are listed in section 66D;
List of 66D:
WORKS CONTRACT
What is a works contract? Means “a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such property.
Service portion in the works contract is declared as a “service” in terms of section 66E of the Finance Act, 1994 (as amended in 2012).
Thus, service portion in works contract is liable to service tax.
Regular Method:
The value of service portion in the works contract is the Gross amount charged for the execution of such works less the value of material supplied and the VAT/CST.
WORKS CONTRACT
Works Contract Valuation: Regular Method (continued)
If the value added tax or sales tax has been paid or payable on the actual value of property in goods transferred in the execution of the works contract, then, such value adopted for the purposes of payment of value added tax or sales tax, shall be taken as the value of property in goods transferred in the execution of the said works contract for determination of the value of service portion in the execution of works contract under regular method.
Abatement Method:
In a scenario where the actual value of material is not ascertainable, the service portion of works contract needs to be ascertained as provided under the Service Tax (Determination of Value) Rules, 2006. In terms of the above Valuation Rules, the value of service portion in works contract is as explained
In the next slide
WORKS CONTRACT
Valuation:
Category of Service Service % in WC Remarks
New Construction
Additions, Alteration to
abandoned or damaged
structures on land to make
them workable
Erection, commissioning or
installation of plant,
machinery or equipment or
structures
40% of Total Value
charged for the
work excluding
VAT/CST
The value of freely issued material by the
contractee should be added to the Gross
amount charged. If the contractee
charges for the supply of any material
then the difference between the amount
charged and the Fair Market Value should
be added to the Gross Amount charged
by the Contractor.
CENVAT credit on Inputs is not available.
However, CENVAT credit on Capital goods
and Input Services is available
Maintenance or repair or
reconditioning or restoration
or servicing of any goods(not
immovable property)
70% of total value
charged for the
work excluding
VAT/CST
Same as above
WORKS CONTRACT
Valuation
Note:
The said abatement is not available, if the actual value of material is ascertainable.
With respect to the works contracts entered in to on or before 30.06.2012 and not yet completed, the new tax position would be applicable for the uncompleted portion of works contract if they are provided or deemed to be provided in terms of PoT Ruels, 2011 on or after 01.07.2012.
The new law does not provide for any transitional relief in such cases.
Category of Service Service % in WC Remarks
Other than above, including maintenance,
repair, completion and finishing services such as
glazing, plastering, floor and wall tiling,
installation of electrical fittings of an
immovable property
60% of total Value
charged for the work
excluding VAT/CST
Same as above
Determination of Value Rules
IS IT NOT A WORKS CONTRACT?
Construction of Building/Complex, Civil Structure: Definition:
“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 completion certificate by the competent authority”.
Civil Structure may include vending plat forms on roads or railway stations intended for sale to a buyer and money received before completion certificate issued is whether a declared service
• However, wherever the construction of complex, building or civil structure includes even the supply of material along with the land, then service tax shall be payable on 25% of the total value and CENVAT credit cannot be availed on the inputs used for provision of such services.
• Prior to 01.07.2012, construction of residential complex and industrial establishment were liable to service tax if there was no supply of material for the execution of such works. However, there was an abatement of 67% of the Gross Amount charged provision of such services under Notification No.01/2006.
EXEMPT SERVICES
Rule 2(e) of CCR, 2004:
means a 1) Taxable service which is exempt from the whole of the service tax leviable
thereon; or(Notification No.25/2012 dated.20.06.2012)
2) Service, on which no service tax is leviable under section 66B of the Finance Act; or
3) taxable service whose part of value is exempted on the condition that no credit of inputs and input services, used for providing such taxable service, shall be taken;
but shall not include
a service which is exported in terms of rule 6A of the Service Tax Rules, 1994.]
Exempt Services Rescinded
Notifications
REVERSE CHARGE MECHANISM
Following services have been specified under the new law, on which the recipient is liable to service tax on reverse charge mechanism:
Uniquely, under the present law, the liability on certain services is shared between the service provider and the recipient.
SL.No
Nature of the service % of Tax payable by the provider
% of Tax payable by the receiver
1 In respect of service provided or agreed to be provider by an insurance agent to any person carrying on insurance business
Nil 100
2 In respect of service provided or agreed to be provider by a goods transport agency in respect of transport of goods by road.
Nil 100
3 In respect of services provided or agreed to be provider by way of sponsorship Nil 100
4 In respect of service provided or agreed to be provider by an arbitral tribunal Nil 100
Reverse charge
REVERSE CHARGE MECHANISM SL.No
Nature of the service % of Tax payable by the provider
% of Tax payable by the receiver
5 In respect of services provided or agreed to be provided by individual advocate or a firm of advocates by way of legal services to any Business Entity located in Taxable territory.
Nil 100
6 In respect of services provided or agreed to be provided by way of support services by Government or local authority, excluding,- (1) Renting of Immovable property, and (2) service specified in sub- Clauses (i),(ii) of Clause of section 66D of the Finance Act, 1994 to any business Entity in the Taxable territory.
Nil 100
7 In respect of any taxable services provided or agreed to be provided by any person who is located in a non-taxable territory and received by any person located in the taxable territory
Nil 100
8 In respect or service provided or agreed to be provided by way of works contract provided by individual, HUF, partnership firm to any Business Entity registered as a Body Corporate.
50 50
REVERSE CHARGE MECHANISM
SL.No
Nature of the service % of Tax payable by the provider
% of Tax payable by the receiver
9 In respect of services provided or agreed to be provided by
way of renting or hiring any motor vehicle designed to carry
passenger on abated value provided by individual, HUF,
partnership firm to any Business Entity registered as a Body
Corporate who is not engaged in the similar line of business.
Nil 100
In respect of services provided or agreed to be provided by
way of renting or hiring any motor vehicle designed to carry
passenger on non-abated value provided by individual, HUF,
partnership firm to any Business Entity registered as a Body
Corporate who is not engaged in the similar line of business.
60 40
10 In respect of services provided or agreed to be provided by way of supply manpower for any purpose provided by individual, HUF, partnership firm to any Business Entity registered as a Body Corporate. (It shall not include the man power recruitment services)
25 75
ABATEMENT
SL.
No.
Description of Taxable service Upto
30.6.12
From
01.07.12
Conditions
1 Financial leasing services including
equipment leasing and hire purchase
10 10 Nil.
2 Bundled service by way of supply of
food or any other article of human
consumption or any drink, in a
premises, including hotel, convention
center, club, pandal, shamiana or any
place specially arranged for organizing a
function, together with renting of such
premises
60 70 CENVAT credit on any goods
classifiable under chapter 1
to 22 of the Central Excise
Tariff Act, 1985 (5 of 1986)
used for providing the
taxable service has not been
taken
3 Transport of passengers by air, with or
without accompanied belongings
N.A. 40 CENVAT credit on inputs and
capital goods has not been
taken
4 Renting of hotels, inns, guest houses,
clubs, campsites or other commercial
places meant for residential or lodging
purposes.
50 60 Same as above.
ABATEMENT
SL.
No.
Description of Taxable service Upto
30.6.12
From
01.07.12
Conditions
5 Transport of goods by road by Goods
Transport Agency
25 25 CENVAT credit on inputs,
capital goods and input
services, used for providing the
taxable service, has not been
taken.
6 Renting of any motor vehicle designed
to carry passengers
40 40 Same as above.
7 Transport of goods in a vessel N.A. 50 Same as above.
8 Construction of a complex, building,
civil structure or a part thereof,
intended for a sale to a buyer, wholly
or partly except where entire
consideration is received after issuance
of completion certificate by the
competent authority
33 25 (i) CENVAT credit on inputs
used for providing the taxable
service has not been taken
(ii)The value of land is included
in the amount charged from
the service receiver.
Abatement
POINT OF TAXATION RULES, 2011
Types of services that can be inferred 1.Continuous supply of services
2.Other than continuous supply of services
What is Continuous supply of service?
“Continuous Supply of service” (CSS) is defined to mean any service provided or to be
provided continuously or on recurrent basis, under a contract, for a period exceeding
three months with the obligation for payment periodically or from time to time or
those services which are notified by the Central Government”
Notified Continuous Supply of Services (a)Telecommunication service
(b) Internet Telecommunication Service
(c) Construction of residential complex service (d) Commercial or industrial construction service (e) Works contract service
PoT Rules
POINT OF TAXATION RULES, 2011
PoT in the case of
Continuous & Non Continuous supply of Services
Earliest of the following
Date of Invoice
Date of completion of provision of service , where the invoice has not been issued within 30 days of completion of provision of service
Date of receipt of advance or receipt of money before raising the invoices towards the services provided
Note:
wherever the service provider receives a payment up to Rs.1000/- in excess of the amount mentioned in the invoice, the POT to the extent of such excess amount, at the option of the provider of taxable service, shall be the date of invoice. However, the invoice should have been raised within time mentioned in Rule 4A of ST Rules, otherwise, the date of completion of services shall be the POT
POINT OF TAXATION RULES, 2011
Tabulation
Situation Point of Taxation
Invoice issued, whether service provided or yet to be provided Invoice is raised within 30/45 days of completion
provision of services and payment not received
Invoice not raised within 30/45 days of completion of provision of service
The date of invoice Date of completion of provision of service
Services provided and 30/45 days time to raise the invoice is not elapsed and the amount is received after completion of services but before issuance of invoice
Date of receipt of such money
When the advance is received against the services to be provided
Date of receipt of such advance
Where an event, specified in the contract, determines the stage of provision of service wholly or partly
Date of completion of such event
POINT OF TAXATION RULES, 2011
Illustration for non CSS scenario
Service Provided Payment
Received Due date For issuing Invoice On or before
Invoice issued on
Point of Taxation
Due date for payment of Service Tax
30.04.12 30.04.12 30.04.12 30.04.12
15.04.12(advance) 01.06.2012 07.05.12 07.05.12
15.05.12 30.05.12 30.05.12 30.05.12
14.05.12 30.05.12 30.05.2012 06.06.12
15.04.12 30.05.12 07.05.12 30.04.12 or 07.05.2012
5th or 6th of May -2012 5
th or 6
th June-2012
5
th or 6
th of June-2012
5
th or 6
th May-2012 or 5
th or
6th
June -12
02.05.12 Nil 01.06.12 31.05.12 31.05.12 5th
or 6th
of June- 2012
02.05.12 Nil 01.06.12 01.06.12 01.06.12 5th
or 6th
of Jul- 2012
02.05.12 Nil 01.06.12 02.06.12 02.05.12 5th
or 6th
of June- 2012
Nil Nil 01.04.12 01.04.12 5th
or 6th
of May- 2012
30.04.12 Nil 30.05.12 Not issued 30.04.12 5th
or 6th
of May 2012
POINT OF TAXATION RULES, 2011
Illustration for CSS scenario
Expected DOC of
event, mentioned in the contract
Actual Date of completion of
Advance or Payment Received
due date for issuing Invoice
Invoice issued on
Point of Taxation
due date for payment of ST
20.04.12 05.04.12 Nil 05.05.12 04.05.12 04.05.12 5th or 6th Jun-2012
20.04.12 05.04.12 Nil 05.05.12 06.05.12 05.04.12 5th or 6th May -2012
31.07.12 15.08.12 Nil 15.09.12 14.09.12 14.09.12 5th or 6th October- 2012
31.07.12 15.08.12 Nil 15.09.12 16.09.12 15.08.12 5th
or 6th
Sept-2012
Not mentioned 01.08.12 15.07.12 14.08.12 14.08.12 15.07.12 5th or 6th of August- 2012
POINT OF TAXATION RULES, 2011
PoT in the case of Change in effective Rate of Tax ( Includes change in the
portion of value on which tax is payable in terms of an exemption notification or rules made in this regard ).
Service
provided Invoice raised Payment received Point of taxation
Before After After Date of Invoice or Payment which ever is earlier
Before Before After Date of Invoice
Before After Before Date of payment
After Before After Date of payment
After Before Before Date of Invoice or Payment which ever is earlier
After After Before Date of Invoice
POINT OF TAXATION RULES, 2011
(Cont..)
PoT in the case of change in effective rate of tax
To Sum up:
If • Two of the three events mentioned in the table have occurred before the change
in ERT, then the old rate would be applicable
• Two of the three events have occurred after ERT then the new rate be applicable
POINT OF TAXATION RULES, 2011
What is the date of payment? w.e.f. 01.04.2012 Generally Earliest of the dates on which
– The payment is entered in the books of account of the service provider
or – The actual credit in the bank statement of person liable to pay service tax. (Not only a
service provider)
However, In a scenario where there is a change in the rate of service tax or services are taxed for the first time and if there is a “Time Difference” between the payment entry in the books of account and the actual credit in the bank account of the service provider, Date of payment is: The actual credit in the bank account should be the date of payment.
But, If the time difference is not more than 4 days from the date of change in rate of tax or new levy, then the date of entry in the books of account shall be the date of payment.
(Illustration follows )
POINT OF TAXATION RULES, 2011
(Date of Payment)
Change of rate of service tax from 10% to 12% w.e.f. 01.04.2012
The date of payment as per POT Rules and the applicable rate of service tax shall be
EVENT DATE Scenario 1
Date Scenario 2
Date of invoice 15.03.2012 15.03.2012
Date of payment and entry in the books of account of service provider
31.03.2012 31.03.2012
Credit in the Bank account of the service provider
05.04.2012 07.04.2012
Scenario Payment date
Point of Taxation
Rate of Tax
1 31.03.2012
31.03.2012 10.30%
2 07.04.2012 07.04.2012 12.36%
POINT OF TAXATION RULES, 2011
New Services
Invoice Raised Payment
Received Point of Taxation
Before taxability Before taxability Not taxable
within 14 days from its taxability Before taxability Not taxable
After 14 days Before taxability Taxable
Before taxability After taxability ???? ( not taxable) Rule 3 is applicable
PoT Rules
POINT OF TAXATION RULES, 2011
In the case of Taxable Intellectual Property Rights Services
Notes:
POT Rules are w.e.f. 01.04.201.
However, where the provision of service is completed or invoices issued on or before 30.06.2012, the point of taxation shall, at the option of the taxpayer, be the date on which the payment is received or made as the case may be.”.
Situation Point of Taxation
When the whole consideration is determinable at the time of transfer of rights
As applicable in the general situation
When the whole consideration is not determinable at the time of transfer of rights and the payments received in at several points of time thereafter
Such payment or issuance of invoice which ever is earlier
POINT OF TAXATION RULES, 2011
In the case of specified services and persons
Specified
services/Persons
Nature of services Point of Taxation Remarks
Export of services
Any Taxable Service
Normal Method However, the payment is received as per RBI regulations or within such extended period
Individuals or Partnership firms whose AVTS provided in P.Y is Rs.50 Lakhs or less
Any Taxable services Normal Method
However service tax shall be paid on or before 5th or 6th of the month or quarter in which payment is received
Associated Enterprises situated outside India
Any Date of debit in books or receipt whichever is earlier
Services on which liability arises on reverse charge mechanism
Specified services under Rule 2(1)(d) of Service Tax Rules,1994
Date of payment made
This facility will not be available, if the payment is not made within 6 months from the date of invoice
POINT OF TAXATION RULES, 2011
Best judgment of POT: if the
date of invoice or
date of payment or both are not available,
Procedure: The office may call for production of such accounts, documents or other evidence as may be deemed necessary and after taking into account such material and the effective rate of tax prevalent at different points of time, by an order in writing, after giving an opportunity of being heard, determine the point of taxation to the best of his judgment.”.
POINT OF TAXATION RULES, 2011
Non-applicability of POT Rules:
If Invoice is raised Before 01.04.2011
or
Service is provided
POINT OF TAXATION RULES, 2011 INVOICE/BILL/CHALLAN An invoice, Bill or a Challan should be
• Serially numbered
• Name, Add & STC No. of SP
• Name, Add of SR
• Description, Classification and Value
• ST payable there on
Includes other documents
• Banking - Any document what ever name
• GTA - Consignment Note No. Gross weight
• Air Travel –Ticket
• ISD Challan
Invoice Not in this format is not Invoice as per POT
Whether Performa Invoice or RA Bills an appropriate invoice?
Rule 2(d) of PoT Rules encompasses wide variety of cases as it refers to “any document”. Thus, issue of “Pro-forma” invoice / bill will also get covered leading to creating the liability for payment of tax.??????
POINT OF TAXATION RULES, 2011
INVOICE/BILL/CHALLAN AND PAYMENT OF SERVICE TAX
What is the due date for issuing invoice/challan/bill?
Within 30/45 days from the date of completion of taxable service or receipt of money
Whether u need to issue an invoice within 30 days if u provide exempt services?
Yes
What do you do, If you have practical problems in issuing an invoice/challan/bill?
CBEC Circular No.144/13/2012-ST Dated July 18, 2012 guides you
PLACE OF PROVISION OF SERVICES RULES 2012(PoPoS)
Objective:
To replace Export and Import of Services Rules
10 Rules to determine the Deemed PoPoS irrespective of actual PoP
CONDITIONS TO QUALIFY AS EXPORT OF SERVICES
• RULE 6A. Export of services: • The provision of any service provided or agreed to be provided shall be treated as
export of service when,-
• (a) Provider of service is located in the taxable territory ,
• (b) Recipient of service is located outside India,
• (c) Service is not a service specified in the section 66D of the Act,
• (d) The place of provision of the service is outside India,
• (e) The payment for such service has been received by the provider of service in convertible foreign exchange, and
• (f) The provider of service and recipient of service are not merely establishments of a distinct person in accordance with item (b) of Explanation 2 of clause (44) of section 65B of the Act
Open for
Avoidance of taxes is the only intellectual pursuit that still carries reward
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