Useful for CA CS CMA ICWA November/December 2015

1. 6:46 PM

2. NEGATIVE LIST SERVICES
Section 66D
 Services by Government / Local Authority,
 Services by the Reserve Bank of India,
 Services by Foreign Diplomatic Mission,
 Services in relation of Agriculture,
 Trading of goods,
 Manufacture of goods,
6:46 PM

3. Discussion of exemptions and
negative list
 General Exemption for Small Service Providers,
 Exemptions based on the Status of Service
Provider,
 Exemptions based on the Status of Service
Receiver,
 Industry-Wise Exemptions, and
 Miscellaneous Exemptions
6:46 PM

4. NEGATIVE LIST SERVICES
Section 66D
 Selling of space or time for advertisement,
 Services by way of access to road or bridge,
 Betting, Gambling, etc.,
 Entertainment Events and Amusement
Facilities,
 Transmission or Distribution of Electricity,
 Educational Services
6:46 PM

5. NEGATIVE LIST SERVICES
Section 66D
 Renting of Residential Dwelling,
 Financial Services,
 Transportation of passengers,
 Transportation of Goods,
 Mortuary Services.
6:46 PM

6. 6:46 PM

7. Exemption
 Aggregate Value of taxable services
received / invoices raised not exceeding
`10 Lakhs ( aggregate of all kinds of services
from all premises)
 Service Provider will be liable to pay tax only
in respect of payments received / invoices in
excess of `10 Lakhs
6:46 PM

8. CENVAT Credit
 Not available up to specified period /amount …(`10
Lakhs)
 CENVAT Credit Available --after the exemption
period /amount ( exceeding `10 Lakhs)
 Reverse the duty credit in respect of inputs in
stock and inputs in process as on the date on
which the he starts availing exemption benefit
 Unavailed Credit on the date of availing
exemption will be lapsed
6:46 PM

9. Nature of Exemption
 The exemption benefit is optional, and
the Service Provider can choose not to opt
for this exemption.
 However, the option once exercised,
shall not be withdrawn during the
remaining part of that financial year.
6:46 PM

10. Nature of Exemption
 The exemption benefit is optional, and
the Service Provider can choose not to opt
for this exemption.
 However, the option once exercised,
shall not be withdrawn during the
remaining part of that financial year.
6:46 PM

11. 6:46 PM

12. 6:46 PM

13. Special Economic Zone
 It is a zone specified as Special Economic
Zone by the Central Government
[u/s 3(1) Proviso Expln. 3(iii) of CEA,
1944]
 Special Economic Zone is a specifically
delineated area, considered as an area
beyond the territory of India, for the
purpose of Taxes ad Duties
6:46 PM

14. Developer of Special Economic
Zone
 A person engaged in –
 (i) Development, or
 (ii) Operation, or
 (iii) Maintenance, of an SEZ
 Inclusion: Person authorized by the
Developer for such purpose
6:46 PM

15. Nature of Exemption
6:46 PM
If Service
received are
Exclusively used
for SEZ’s
authorized
operations
Not exclusively
used for SEZ
Service
Providers
Duties
Need not levy ST in
his Invoice raised
on Developer or
Unit of SEZ
Shall levy ST in his
Invoice, collect and
pay to Government
Refund of ST Does not arise ST Refunded to
Developer or Unit
in SEZ

16. 6:46 PM

17. Negative List
 All Services received by Government
(Central / State Government / union
Territories) or a Local Authority are covered
by Negative List
6:46 PM

18. Services not in Negative List =
Taxable Services
 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.
 Services provided to Government or Local
Authority or Governmental Authority by way of
repair or maintenance of an aircraft is taxable.
 (Whether it is inside or outside the precincts of a
port or an airport)
 [Impact: Earlier such service was exempted].
6:46 PM

19. Services not in Negative List =
Taxable Services
 Transport of Goods or Passengers on charter or
hire basis.
 (Note: If the transportation is by Stage Carriage or
by Railways in specified class or by Metro /
Monorail / tramways or Inland Waterways or
Public Transport in vessel, it is exempt from tax)
 Other Support Services provided to business
entities.
6:46 PM

20. 6:46 PM

21. Taxable Services
 1.Courier Services (Speed Post)
 2.Insurance Services(Postal Life Insurance),
 3.Agency or Intermediary Services on
commission basis (Distribution of Mutual
Funds, Bonds, Passport Applications,
Collection of Telephone & Electricity Bills).
 Note
 The above activities are taxable, as they are rendered
by other Commercial entities also
6:46 PM

22. Non- Taxable Services
 1. Basic Mail Services known as Postal Services
such as Post card, Inland Letter, Book Post,
Registered Post provided exclusively by the
Department of Posts to meet the universal postal
obligations.
 2.Transfer of money through Money Orders,
Operation of Savings Accounts, Issue of Postal
Orders, Pension Payments and other such
Services.
6:46 PM

23. RESERVE BANK OF INDIA [Sec.
66D(b)]
 Negative List: All services provided or agreed to be
provided by the Reserve Bank of India are not liable for
ST
6:46 PM

24. RESERVE BANK OF INDIA [Sec.
66D(b)]
 Taxability: The following services are still liable
for Service Tax-
 a. Any Service provided to the Reserve
Bank of India
 b. Any service provided to the RBI, where the
Service Tax is payable by RBI under reverse charge
mechanism
6:46 PM

25. FOREIGN DIPLOMATIC MISSION
[S.66D(C)
Service Provided
To
Purpose
Foreign Diplomatic
Mission or Consular
post in India
Official Use of such
Foreign mission /
Consulates
Diplomatic Agents or
Career Consular
Officers or their
family members
Personal use of such
persons
6:46 PM

26. UNITED NATIONS AND
INTERNATIONAL ORGANISATIONS
 United Nations International Children’s Emergency Fund
(UNICEF)
 United Nations Educational, Scientific and Cultural
Organization (UNESCO)
 Food and Agriculture Organizations of the United Nation.
 World Health Organization (WHO)
 International Telecommunication Union.
 International Labour Organization (ILO)
 International Monetary Fund(IMF)
 World Bank
 Universal Postal Union.
 International Civil Aviation Organization.
6:46 PM

27. CHARITABLE TRUSTS
 Public Health
 Advancement or religion or spirituality
 Advancement or educational programmes or skill
development for abandoned, orphaned or homeless
children/ physically or mentally abused and
traumatized persons / prisoners/ persons above 65
years residing in rural area.
 Preservation of environment including watershed,
forests and wildlife
6:46 PM

28. 6:46 PM

29.  Agricultural Operations [Sec.66D)]
 TRADING / MANUFACTURING
ACTIVITIES [Sec.66D(e)]
 PROCESSING OF GOODS [Sec.66D(f).]
6:46 PM

30. ADVERTISEMENT[Sec.66D(g)]
 Negative List: Selling of Space or Time Slots for
advertisements are not liable for service tax.
This includes the following activities:
 a. Advertisements in Newspapers and
Journals, i.e. Print Media,
 b. Advertisements in Bill Boards, Public Places
(including stadium,)Buildings, Conveyances, Cell
Phones, ATMs, internet, etc.
6:46 PM

31. Taxable Services
 Advertisements in Radio or Television,
 Sale of Time Slot by Broadcasting
Organization,
 Mere Canvassing advertisement of publishing
on a newspaper on commission basis,
 Services rendered by Advertisement Agencies
relating to making or preparation of
advertisements, facilitation services to
Broadcasting / publishing companies.
6:46 PM

32. SPORTSPERSON / SPORTS
RELATED ACTIVITIES
 Exemption:
 1. Services provided by an individual as a
Player, Referee, Umpire, Coach or Team
Manager to a recognized Sports Body, in
relation to participation in a sporting event
organized by a recognized Sports Body.
 2. Services by way of Sponsorship of
sporting events
6:46 PM

33. SPORTSPERSON / SPORTS
RELATED ACTIVITIES
 Taxable Services:
 a. Services by individuals such as
Selectors, Commentators, Curators and
Technical Experts.
 b. Services by a sports person to any
Franchisee are taxable, since such
Franchisee is not a recognized sports
body
6:46 PM

34. AMUSEMENTS PARKS AND OTHER
ENTERTAINMENT
SER VICES[Sec.66D(j)]
 Negative List: Services of admission to
entertainment events / access to
amusement facilities do not attract
Service Tax
6:46 PM

35. Taxable Services
 Catering, Transportation, Guest-house
Services provided within the Amusement
Park,
 Membership of a Club, which enables access
to recreational facilities.
 Input Services provided by a person like an
Event Manager for organizing an
Entertainment Event or by an Entertainer
for the providing the entertainment
6:46 PM

36. HEALTH CARE SERVICES
 Exemption:
 Health Care Services by a Clinical
Establishment, an Authorized Medical
Practitioner or Para-medics.
 Services by a Veterinary Clinic in
relation to health care of animals or
birds.
6:46 PM

37. PROPERTY RELATED SERVICES
(S.66D(m,h)
 Negative List: The following activities are
exempt from ST –
 Renting or Residential Dwelling for use as
residence.[Sec.66D(m)]
 Access to a road or bridge on payment of
Toll Charges. [Sec.66D(h)]
6:46 PM

38. TRANSPORTATION OF
PASSENGERS[Sec.66D(o)]
6:46 PM

39. FINANCIAL SERVICES [Sec.66D(n)]
 Negative List: Services by way of –
 Extending Deposits, Loans or Advance, to
the extent the consideration is interest
or discount.
 Sale or purchase of Foreign Currency
between 2 or more Banks, between 2 or
more Authorized Dealers or between Banks
and Authorized Dealers
6:46 PM

40. Miscellaneous Services
 Services Provided by an Advocate (` 10
lakhs)
 Services by Arbitral Tribunal or
Members thereof
 Services by an Association of Persons to
its Members
 Exemptions for Intermediary Services
6:46 PM

41. Miscellaneous Services
 Betting, Gambling or Lottery
[Sec.66D(i)]
 Transmission or Distribution of
Electricity a Taxable Service [Sec.66D(k)]
 Services provided as part of Supply of
Food for Human Consumption
 Exemptions available to Science and
Technology Parks / Units
6:46 PM