ST Amendments(Finance Act, 2015)

1. Finance Minister has proposed to revise the rate of
Service Tax from 12.36% (inclusive of Education
Cesses) to 14% (subsuming Education Cesses).
Effective Date:-1st June 2015
2. Swachh Bharat cess at the rate of 2% on the value
of service proposed to be levied.
Effective Date:-Effective from the date to be
notified.
1. Finance Minister has proposed to revise the rate of
Service Tax from 12.36% (inclusive of Education
Cesses) to 14% (subsuming Education Cesses).
Effective Date:-1st June 2015
2. Swachh Bharat cess at the rate of 2% on the value
of service proposed to be levied.
Effective Date:-Effective from the date to be
notified.

1. Entry No. 2:- Government has given specific
exemption for transporting the patients through
ambulances by inserting clause (ii) in Entry No.2.
2. Entry No.12:- Construction of Civil structure,
Educational, clinical establishment and residential
complex now become taxable as clause (a), (c) &
(f) being removed.
3. Entry No.14:- Construction of an airport or port
now become taxable as the same has been deleted
from entry no.14.
1. Entry No. 2:- Government has given specific
exemption for transporting the patients through
ambulances by inserting clause (ii) in Entry No.2.
2. Entry No.12:- Construction of Civil structure,
Educational, clinical establishment and residential
complex now become taxable as clause (a), (c) &
(f) being removed.
3. Entry No.14:- Construction of an airport or port
now become taxable as the same has been deleted
from entry no.14.

4. Entry No. 16:-Consideration received by an artist for
the performance in folk and classical art forms of
music, art or dance is taxable, if it is more than Rs.1
lakh. Further exemption shall not apply to service
provided by such artist as a brand ambassador.
5. Entry No. 20& 21:-Exemption given in respect of
transportation of food stuff will be limited food grains
including flours, pulses and rice. Now transportation
of tea, coffee, jiggery, sugar and edible oil is
taxable.(Transportation by rail or vessel or by GTA).
4. Entry No. 16:-Consideration received by an artist for
the performance in folk and classical art forms of
music, art or dance is taxable, if it is more than Rs.1
lakh. Further exemption shall not apply to service
provided by such artist as a brand ambassador.
5. Entry No. 20& 21:-Exemption given in respect of
transportation of food stuff will be limited food grains
including flours, pulses and rice. Now transportation
of tea, coffee, jiggery, sugar and edible oil is
taxable.(Transportation by rail or vessel or by GTA).

6. Entry No. 26A:-Insertion of one more life insurance scheme
namely Varishtha Pension Bima Yojana which is also exempt
under Entry No. 26A.
7. Entry No. 29:- Earlier services provided by mutual fund
agent/distributor to Mutual Fund/AMC and services
provided by selling agent of lottery tickets to distributor was
exempted. However now it became taxable under reverse
charge.
8. Entry No.30:- Carrying out an intermediate production
process as job work in case of alcoholic liquors(not in case of
other goods) is not exempted even though the appropriate
duty is paid by principal manufacturer. Earlier the exemption
is for all goods.
6. Entry No. 26A:-Insertion of one more life insurance scheme
namely Varishtha Pension Bima Yojana which is also exempt
under Entry No. 26A.
7. Entry No. 29:- Earlier services provided by mutual fund
agent/distributor to Mutual Fund/AMC and services
provided by selling agent of lottery tickets to distributor was
exempted. However now it became taxable under reverse
charge.
8. Entry No.30:- Carrying out an intermediate production
process as job work in case of alcoholic liquors(not in case of
other goods) is not exempted even though the appropriate
duty is paid by principal manufacturer. Earlier the exemption
is for all goods.

8. Entry No. 32:-Related to Telephone calls, public
telephones etc has been deleted.
9. Entry No. 43(New entry):- Services by operator of
Common Effluent Treatment Plant by way of
treatment of effluent are exempted.
10.Entry No. 44(New entry):- Services by way of pre-
conditioning, pre-cooling, ripening, waxing, retail
packing, labelling of fruits and vegetables which do
not change or alter the essential characteristics of
the said fruits or vegetables are exempted.
8. Entry No. 32:-Related to Telephone calls, public
telephones etc has been deleted.
9. Entry No. 43(New entry):- Services by operator of
Common Effluent Treatment Plant by way of
treatment of effluent are exempted.
10.Entry No. 44(New entry):- Services by way of pre-
conditioning, pre-cooling, ripening, waxing, retail
packing, labelling of fruits and vegetables which do
not change or alter the essential characteristics of
the said fruits or vegetables are exempted.

11.Entry No. 45(New entry):-Services by way of
admission to a museum, national park, wildlife
sanctuary, tiger reserve or zoo are exempted.
12.Entry No. 46(New entry):-Service provided by way
of exhibition of movie by an exhibitor to the
distributor or an association of persons consisting
of the exhibitor as one of its members is
exempted.
11.Entry No. 45(New entry):-Services by way of
admission to a museum, national park, wildlife
sanctuary, tiger reserve or zoo are exempted.
12.Entry No. 46(New entry):-Service provided by way
of exhibition of movie by an exhibitor to the
distributor or an association of persons consisting
of the exhibitor as one of its members is
exempted.

13.Entry No. 47(New entry):- Entry to recognized
sporting events/ entertainment events. However, in
case of award function, musical performance, any
unrecognized sporting events etc, exemption will not
be available in case the entry charge exceeds Rs. 500.
14. Other changes:- New definitions of National Park,
Recognized sport event , Tiger reserve, trade union,
wildlife sanctuary & zoo inserted.
Effective Date:- Entries mentioned in Sr. No. 1 to 12 & 14
will be effective from 1st April, 2015.
Entry No. 47 will be effective from 1st June, 2015.
13.Entry No. 47(New entry):- Entry to recognized
sporting events/ entertainment events. However, in
case of award function, musical performance, any
unrecognized sporting events etc, exemption will not
be available in case the entry charge exceeds Rs. 500.
14. Other changes:- New definitions of National Park,
Recognized sport event , Tiger reserve, trade union,
wildlife sanctuary & zoo inserted.
Effective Date:- Entries mentioned in Sr. No. 1 to 12 & 14
will be effective from 1st April, 2015.
Entry No. 47 will be effective from 1st June, 2015.

1. Following services have been inserted under
reverse charge mechanism:-
Sr.
No
.
Services % of ST
payable
by SP
% of ST
payable
by SR
1. Services provided or agreed to be provided by a mutual fund
agent or distributor, to a mutual fund or asset management
company.(Earlier the above mentioned service is exempted under
mega exemption notification)(Effective Date:-1st April, 2015)
Nil 1001. Services provided or agreed to be provided by a mutual fund
agent or distributor, to a mutual fund or asset management
company.(Earlier the above mentioned service is exempted under
mega exemption notification)(Effective Date:-1st April, 2015)
Nil 100
2. Service provided or agreed to be provided by a selling or
marketing agent of lottery tickets to a lottery distributor or selling
agent. (Earlier the above mentioned service is exempted under
mega exemption notification) (Effective Date:-1st April, 2015)
Nil 100
3. Service provided or agreed to be
provided by a person involving an aggregator in
any manner(Also Refer Amendment No.4) (Effective Date:-1st
March, 2015)
Nil 100

2. Earlier only the support services provided by the government or
local authority is covered under RCM, however now all the
services including support services provided by Government is
covered under RCM excluding
a. Renting of Immovable property
b. services as specified in sub-clauses (i), (ii) & (iii) of clause (a) of
Section 66D of the Finance Act, 1994.
To give effect to the amendment corresponding change has also
been made to the definition of “person liable to pay service tax”
under clause (d) of Rule 2 of Service tax Rules, 1994.
Effective Date:- Effective from the date notified after the bill receives
the assent of the president.
2. Earlier only the support services provided by the government or
local authority is covered under RCM, however now all the
services including support services provided by Government is
covered under RCM excluding
a. Renting of Immovable property
b. services as specified in sub-clauses (i), (ii) & (iii) of clause (a) of
Section 66D of the Finance Act, 1994.
To give effect to the amendment corresponding change has also
been made to the definition of “person liable to pay service tax”
under clause (d) of Rule 2 of Service tax Rules, 1994.
Effective Date:- Effective from the date notified after the bill receives
the assent of the president.

3. In case of Services provided or agreed to be
provided by way of supply of manpower for any
purpose, the service receiver is liable to pay
service tax under RCM @75% of total service tax
payable.
Now SR is liable to pay 100% service tax liability
under RCM.
Effective Date:- 1st April 2015.
3. In case of Services provided or agreed to be
provided by way of supply of manpower for any
purpose, the service receiver is liable to pay
service tax under RCM @75% of total service tax
payable.
Now SR is liable to pay 100% service tax liability
under RCM.
Effective Date:- 1st April 2015.

4. The heading of Column 4 of the above mentioned
table changed with the following words:-
“Percentage of service tax payable by any
person liable for paying service tax other than
the service provider”;
Effective Date:- 1st March 2015.
4. The heading of Column 4 of the above mentioned
table changed with the following words:-
“Percentage of service tax payable by any
person liable for paying service tax other than
the service provider”;
Effective Date:- 1st March 2015.

Service :- Service provided or agreed to be provided
by a person involving an aggregator in any manner.
Person Liable to pay Service tax:-
Condition Person liable to pay service tax
If services provided or agreed to be
provided by the person without the
involvement of aggregator
Ex-Naukri Jobs.com
The person providing the service
If services provided or agreed to be
provided by the person involving an
aggregator in any manner
Ex-Ola cabs.
The aggregator or any of his representative
office located in India or by agent
appointed by the aggregator shall pay the
tax on behalf of the aggregator.

Who is Aggregator ?
Aggregator means a person
 who owns and manages a web based software
application and
 by means of the application and a communication
device
 enables a potential customer to connect
 with the person providing service of a particular kind
 under the Brand name or trade name of the
aggregator.
Who is Aggregator ?
Aggregator means a person
 who owns and manages a web based software
application and
 by means of the application and a communication
device
 enables a potential customer to connect
 with the person providing service of a particular kind
 under the Brand name or trade name of the
aggregator.

What is the meaning of Brand name or trade name ?
“Brand name or trade name” means, a brand name or
a trade name, whether registered or not, that is to
say, a name or a mark, such as an invented word or
writing, or a symbol, monogram, logo, label,
signature, which is used for the purpose of indicating,
or so as to indicate a connection, in the course of
trade, between a service and some person using the
name or mark with or without any indication of the
identity of that person.
What is the meaning of Brand name or trade name ?
“Brand name or trade name” means, a brand name or
a trade name, whether registered or not, that is to
say, a name or a mark, such as an invented word or
writing, or a symbol, monogram, logo, label,
signature, which is used for the purpose of indicating,
or so as to indicate a connection, in the course of
trade, between a service and some person using the
name or mark with or without any indication of the
identity of that person.

Comparison between old and new abatements:-
Sr No. Description of taxable service Before
Amendment
After Amendment
2&3 Transportation of
goods/passengers by Rail
No condition for
availing CENVAT
CENVAT is not allowed on
inputs, capital goods and
input services for availing
abatement.
CENVAT is not allowed on
inputs, capital goods and
input services for availing
abatement.
5 Transportation of passengers by
air, with or without belongings in
(i) Economy class
(ii) Other than economy class
60% abatement
60% abatement
40% abatement
60% abatement
7 Services of GTA in relation of
transportation of goods
75% abatement 70% abatement
8 Services provided in relation to
Chit
30%abatement Nil
10 Transport of goods in a vessel 40%abatement 30%abatement

The CBEC vide its order no.1/2015 dated 28th February,
2015 simplifies the procedure for registration of single
premise. Highlights of the order as follows:-
1. Online application in Form ST-1.
2. Mandatory requirement of PAN, E-mail & Mobile
number.
3. Online granting of registration within 2 days from the
date of filing of ST-1.
Effective Date:-1st March, 2015
The CBEC vide its order no.1/2015 dated 28th February,
2015 simplifies the procedure for registration of single
premise. Highlights of the order as follows:-
1. Online application in Form ST-1.
2. Mandatory requirement of PAN, E-mail & Mobile
number.
3. Online granting of registration within 2 days from the
date of filing of ST-1.
Effective Date:-1st March, 2015

1 Amendment in Rule 4(1) & 4(2): Availability of CENVAT credit on
inputs/capital goods directly dispatched to job worker:-
Before amendment, Cenvat credit was available only on receipt of Capital
Goods/Inputs in the factory of the manufacturer or in the premises of the
provider of output service or outside the factory of the manufacturer of
the final products for generation of electricity for captive use within the
factory. Therefore where goods are directly dispatched to the job worker
the manufacturer was not eligible to take credit.
However amendment has been made in Rule 4 and therefore Cenvat
credit on Capital Goods/Inputs can also be taken immediately on receipt
of the Capital Goods/Inputs in the premises of the job worker, in case
where the Capital Goods are sent directly to the job worker’s premises on
the direction of the manufacturer or the provider of output service.
1 Amendment in Rule 4(1) & 4(2): Availability of CENVAT credit on
inputs/capital goods directly dispatched to job worker:-
Before amendment, Cenvat credit was available only on receipt of Capital
Goods/Inputs in the factory of the manufacturer or in the premises of the
provider of output service or outside the factory of the manufacturer of
the final products for generation of electricity for captive use within the
factory. Therefore where goods are directly dispatched to the job worker
the manufacturer was not eligible to take credit.
However amendment has been made in Rule 4 and therefore Cenvat
credit on Capital Goods/Inputs can also be taken immediately on receipt
of the Capital Goods/Inputs in the premises of the job worker, in case
where the Capital Goods are sent directly to the job worker’s premises on
the direction of the manufacturer or the provider of output service.

2 Amendment in Rule 4(5): Time limit for receipt of
capital goods from the job worker
As mentioned in Point No.1 above that now Cenvat
credit can be taken even if Capital Goods/Inputs
are directly sent to job worker. However as per
Rule 4(5) the capital goods sent must be received
back within 2 years of being sent.
2 Amendment in Rule 4(5): Time limit for receipt of
capital goods from the job worker
As mentioned in Point No.1 above that now Cenvat
credit can be taken even if Capital Goods/Inputs
are directly sent to job worker. However as per
Rule 4(5) the capital goods sent must be received
back within 2 years of being sent.

3 Third proviso to Rule 4(1) and Sixth Proviso to Rule 4(7) of
the Credit Rules amended – Enhancement of time limit for
availing Cenvat credit on Inputs/ Input Services from 6
months to 1 year.
4 Rule 4(7): CENVAT credit in case of partial reverse charge:-
Earlier the Cenvat credit of Input services were allowed on
or after the date on which the payment of the amount of
Service tax as well as value of Input services were made.
However w.e.f 1st April, 2015, Cenvat credit in respect of
partial reverse charge can be availed immediately after
payment of Service tax by the Service recipient.
3 Third proviso to Rule 4(1) and Sixth Proviso to Rule 4(7) of
the Credit Rules amended – Enhancement of time limit for
availing Cenvat credit on Inputs/ Input Services from 6
months to 1 year.
4 Rule 4(7): CENVAT credit in case of partial reverse charge:-
Earlier the Cenvat credit of Input services were allowed on
or after the date on which the payment of the amount of
Service tax as well as value of Input services were made.
However w.e.f 1st April, 2015, Cenvat credit in respect of
partial reverse charge can be availed immediately after
payment of Service tax by the Service recipient.

Rule 6 of service tax rules, 1994 provides an option to the
assessee to pay service tax at the rates specified in the
rules. However the new rates have been incorporated
under the Finance budget, 2015.
The special rates specified for the following services:-
a. Insurance Services
b. Travel Agent Services
c. Money exchange services
d. Lottery Agent service
Effective Date:- Effective from the date notified after the
bill receives the assent of the president.
Rule 6 of service tax rules, 1994 provides an option to the
assessee to pay service tax at the rates specified in the
rules. However the new rates have been incorporated
under the Finance budget, 2015.
The special rates specified for the following services:-
a. Insurance Services
b. Travel Agent Services
c. Money exchange services
d. Lottery Agent service
Effective Date:- Effective from the date notified after the
bill receives the assent of the president.

1. Reimbursement made taxable under Service Tax-Explanation to Section 67(a) of Finance Act,
1994
The government has clarified that the value of reimbursements of all expenses incurred during
provision of a taxable service shall be subject to Service tax levy except in such circumstances
and subject to such conditions as may be prescribed in Service tax (Determination of Value)
Rules, 2006.
2. Revised recovery and penalty provisions
Penalty provisions made more stringent with maximum penalty equal to 100 % of Service Tax.
However, in certain cases the benefit of reduced penalty will be allowed to the assessee. Also,
exemption from levy of penalty on defaulters has been removed by omitting Section 80.
3. Records can be maintained in Electronic form-Rule 4C & 5 of Service Tax Rules,1994
In order to encourage digitalization, Government has allowed assesses to maintain records or
issue invoices/consignment note in the electronic form subject to authentication by him with
the use of digital signature.
1. Reimbursement made taxable under Service Tax-Explanation to Section 67(a) of Finance Act,
1994
The government has clarified that the value of reimbursements of all expenses incurred during
provision of a taxable service shall be subject to Service tax levy except in such circumstances
and subject to such conditions as may be prescribed in Service tax (Determination of Value)
Rules, 2006.
2. Revised recovery and penalty provisions
Penalty provisions made more stringent with maximum penalty equal to 100 % of Service Tax.
However, in certain cases the benefit of reduced penalty will be allowed to the assessee. Also,
exemption from levy of penalty on defaulters has been removed by omitting Section 80.
3. Records can be maintained in Electronic form-Rule 4C & 5 of Service Tax Rules,1994
In order to encourage digitalization, Government has allowed assesses to maintain records or
issue invoices/consignment note in the electronic form subject to authentication by him with
the use of digital signature.

4. Amendment in Section-94 of the Finance Act, 1994
Earlier the CG has the power to make rules for “the determination of amount and value of
taxable service under section 67”. Now the power of CG has been restricted to the cases where
the determination of amount and value of taxable service can not be ascertained under Sec-67.
5. Insertion of Illustration in Sec-66F(1) to clarify the nature of main service
The services by the Reserve Bank of India, being the main service within the meaning of
clause (b) of section 66D, does not include any agency service provided or agreed to be
provided by any bank to the Reserve Bank of India. Such agency service, being input
service, used by the Reserve Bank of India for providing the main service, for which the
consideration by way of fee or commission or any other amount is received by the agent
bank, does not get excluded from the levy of service tax by virtue of inclusion of the main
service in clause (b) of the negative list in section 66D and hence, such service is leviable to
service tax.
4. Amendment in Section-94 of the Finance Act, 1994
Earlier the CG has the power to make rules for “the determination of amount and value of
taxable service under section 67”. Now the power of CG has been restricted to the cases where
the determination of amount and value of taxable service can not be ascertained under Sec-67.
5. Insertion of Illustration in Sec-66F(1) to clarify the nature of main service
The services by the Reserve Bank of India, being the main service within the meaning of
clause (b) of section 66D, does not include any agency service provided or agreed to be
provided by any bank to the Reserve Bank of India. Such agency service, being input
service, used by the Reserve Bank of India for providing the main service, for which the
consideration by way of fee or commission or any other amount is received by the agent
bank, does not get excluded from the levy of service tax by virtue of inclusion of the main
service in clause (b) of the negative list in section 66D and hence, such service is leviable to
service tax.

ST Amendments(Finance Act, 2015)

ST Amendments(Finance Act, 2015)

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