The document provides an overview of the Indian tax structure and focuses on service tax. It defines key terms related to service tax such as "service", "declared service", and discusses the constitutional basis for levying service tax. It explains the determination of whether an activity constitutes a taxable service. Several rules from the Place of Provision of Services Rules, 2012 are summarized, including the basic rules regarding location of the service provider and receiver, as well as specific rules for certain types of services. Trends in top services contributing to service tax collection are also briefly highlighted.
This document discusses the taxation of cross-border services in India. It provides an overview of key concepts related to the export and import of services, including the definition of a "service", legislative background, and taxation rules. Some key points:
1) It outlines the definition of "service" under the new tax regime and exclusions from this definition.
2) It discusses the previous legislative framework for export and import of services prior to 2012, including rules for determining whether a service is exported or imported.
3) It introduces the new taxability framework introduced in 2012, including the concepts of taxable and non-taxable territory, and discusses how the place of provision of services is used to determine taxability
The document discusses the valuation of taxable services under the Service Tax regime in India. It explains how the gross amount charged is considered the value of taxable services as per Section 67 of the Finance Act. Reimbursements are included in the value unless the service provider acts as a pure agent for the recipient. The valuation rules and recent case laws regarding composite contracts, reimbursements, and works contracts are also summarized.
The document discusses service tax on works contracts in India. It defines key terms like works contract, service, and original works. Works contracts are taxable for the service portion. There are two options for calculating the service portion - the actual method which involves subtracting input taxes and value of goods from the gross contract value, and the composition method which takes a percentage of the total contract value depending on the type of works contract. Certain construction services provided to government are exempt from service tax.
GST Supply and Place of Supply - By Venkanna settyvenkanna setty
The document discusses key definitions and concepts related to supply and place of supply under the Goods and Services Tax (GST) in India. It defines supply, person, goods, composite supply, and place of supply of goods and services. Supply is broadly defined and includes all forms of supply of goods/services for consideration as well as activities specified in Schedules I and II. Place of supply of goods is generally where the goods are located at the time of delivery to the recipient. Place of supply of services rules consider location of both supplier and recipient.
Embargo on levy of service tax on flats under composite contracts - Dr Sanjiv...D Murali ☆
Embargo on levy of service tax on flats under composite contracts - Dr Sanjiv Agarwal - Article published in Business Advisor, dated June 25, 2016 - http://www.magzter.com/IN/Shrinikethan/Business-Advisor/Business/
Tweeted on www.twitter.com/BusinessAdvDM
Service tax on Works Contract (Post Negative List)sandesh mundra
This article briefly explains the basics of service tax on works contract after the negative list regime. Also covering some of the old disputed issues in the service tax regime. It also touches upon the basic aspects of Cenvat Credit moreso in an environment, where both taxable and exempt services are being rendered.
Place of Provision of Service Rules, 2012Raj Khona
The document discusses the Place of Provision of Service Rules, 2012 in India. Some key points:
- The rules determine where a service is considered consumed for taxation purposes and aim to avoid double taxation.
- There are 14 rules that cover specific service categories or provide default provisions. Rule 3 is the general default rule.
- The rules examine factors like the location of the service provider, receiver, place of performance to determine the place of provision.
- Examples are provided to illustrate how certain rules like rules 4, 5, 6, and 7 covering performance-based, immovable property related, event-related and multi-location services respectively would apply.
This document discusses the taxation of cross-border services in India. It provides an overview of key concepts related to the export and import of services, including the definition of a "service", legislative background, and taxation rules. Some key points:
1) It outlines the definition of "service" under the new tax regime and exclusions from this definition.
2) It discusses the previous legislative framework for export and import of services prior to 2012, including rules for determining whether a service is exported or imported.
3) It introduces the new taxability framework introduced in 2012, including the concepts of taxable and non-taxable territory, and discusses how the place of provision of services is used to determine taxability
The document discusses the valuation of taxable services under the Service Tax regime in India. It explains how the gross amount charged is considered the value of taxable services as per Section 67 of the Finance Act. Reimbursements are included in the value unless the service provider acts as a pure agent for the recipient. The valuation rules and recent case laws regarding composite contracts, reimbursements, and works contracts are also summarized.
The document discusses service tax on works contracts in India. It defines key terms like works contract, service, and original works. Works contracts are taxable for the service portion. There are two options for calculating the service portion - the actual method which involves subtracting input taxes and value of goods from the gross contract value, and the composition method which takes a percentage of the total contract value depending on the type of works contract. Certain construction services provided to government are exempt from service tax.
GST Supply and Place of Supply - By Venkanna settyvenkanna setty
The document discusses key definitions and concepts related to supply and place of supply under the Goods and Services Tax (GST) in India. It defines supply, person, goods, composite supply, and place of supply of goods and services. Supply is broadly defined and includes all forms of supply of goods/services for consideration as well as activities specified in Schedules I and II. Place of supply of goods is generally where the goods are located at the time of delivery to the recipient. Place of supply of services rules consider location of both supplier and recipient.
Embargo on levy of service tax on flats under composite contracts - Dr Sanjiv...D Murali ☆
Embargo on levy of service tax on flats under composite contracts - Dr Sanjiv Agarwal - Article published in Business Advisor, dated June 25, 2016 - http://www.magzter.com/IN/Shrinikethan/Business-Advisor/Business/
Tweeted on www.twitter.com/BusinessAdvDM
Service tax on Works Contract (Post Negative List)sandesh mundra
This article briefly explains the basics of service tax on works contract after the negative list regime. Also covering some of the old disputed issues in the service tax regime. It also touches upon the basic aspects of Cenvat Credit moreso in an environment, where both taxable and exempt services are being rendered.
Place of Provision of Service Rules, 2012Raj Khona
The document discusses the Place of Provision of Service Rules, 2012 in India. Some key points:
- The rules determine where a service is considered consumed for taxation purposes and aim to avoid double taxation.
- There are 14 rules that cover specific service categories or provide default provisions. Rule 3 is the general default rule.
- The rules examine factors like the location of the service provider, receiver, place of performance to determine the place of provision.
- Examples are provided to illustrate how certain rules like rules 4, 5, 6, and 7 covering performance-based, immovable property related, event-related and multi-location services respectively would apply.
The document discusses taxation on works contracts in India. It provides an overview of how works contracts were historically considered service contracts but a constitutional amendment allowed them to be taxed as deemed sales. It discusses various court cases that shaped the principles of works contract taxation under state VAT and central service tax. Key points covered include the definition of works contracts, methods of valuing works contracts for different taxes, and debates around classifying certain contracts as works contracts or sales.
This document provides an overview of understanding financial statements for the purposes of an audit. It discusses reviewing periods of up to 5 years, focusing on key accounting concepts like money measurement and going concern. Trial balances and balance sheets are examined in detail, including accounts, classifications, movements, and balances. Specific items like reverse charge mechanisms, reimbursements, and netting are highlighted. The tax audit report is also reviewed for depreciation, credit balances, and prior period adjustments. Other areas of focus include ratios, foreign transactions, and demands under other laws.
This document provides an overview of work contract service under Indian tax law, including:
1. It defines a works contract as a contract involving the transfer of goods that is taxable as sale of goods, for purposes like construction, installation, repair, etc. of movable or immovable property.
2. It outlines two methods for determining the taxable service portion of a works contract: by subtracting the value of goods transferred from the total amount, or by applying a percentage to the total amount.
3. It discusses CENVAT credit eligibility and the partial reverse charge mechanism for works contracts.
4. It lists certain works contracts that are exempt from service tax, such as those provided to government
The document provides an overview of the scope of taxation of services under the new service tax regime in India. It discusses key aspects like the definition of "service", declared services, bundled services and abatements. Some of the main points covered include the definition of service, the nine categories of declared services, exemptions for certain types of renting of immovable property, and clarification around taxation of services provided by employers and directors. The presentation aims to explain the broad scope of services covered under the new service tax law in India.
Case Studies of Place of Supply Including Exports-Imports and RefundsGST Law India
the following presentation enumerates a brief study on GST in case of Cross-border Air Travel, work contracts, Hotel Accommodation, Event Organization ,Immovable Property – Place of Supply & ITC Eligibility, Cross-Border Logistic Services, Cross-Border Intermediary Services, Whether Foreign Company can procure goods from India on Bill to-Ship to basis where ship to Location is India, Supply of FOC promotional material to related and unrelated parties outside India, Use of Trademark owned by Foreign-Related Company, Refund of unutilized credit accumulated due to inverted duty structure and lastly Refund of unutilized credit on zero-rated supply
Case Laws on Construction and Works contractsandesh mundra
A compilation of various Judgments of Service Tax and VAT on relevant issues in works contract and construction sector is made. Stands of High court is highlighted on complex issues arising in Constructions and taxation of works contract. A brief description of matter, appellant and petitioner's contemplation and order passed by authorities is also included to add more value.
Declared services and Classification of ServicesCA Gaurav Gupta
The document discusses declared services under service tax law in India. It defines key concepts like service, consideration, activity. It lists various declared services like renting of immovable property, construction services, transfer of intellectual property rights, IT services, agreements to refrain from an act, transfer of goods by hiring/leasing, service portion of works contracts, and service portion related to food supply. Certain renting activities are exempted like renting of residential properties, vacant land for agriculture, and renting by government bodies.
This document summarizes key judgements related to indirect taxes in the Indian construction sector. It discusses two Supreme Court cases - Bharat Sanchar Nigam Ltd. v. Union of India regarding the tax treatment of telecom products with both goods and service components, and State of Andhra Pradesh v. Kone Elevators (India) Ltd regarding whether an elevator installation contract constitutes a works contract or supply of goods. It also discusses factors to consider regarding incidental installation services and interstate works contracts. Overall, the document analyzes how different transactions involving both goods and services have been treated for indirect tax purposes.
This document provides an overview and discussion of key Cenvat Credit rules in India. It begins with definitions of key terms like input service distributor. It then examines various rules around taking and distributing Cenvat credit, including rules around reversal of credit for write-offs, conditions for credit on input services, and refund of Cenvat credit. Examples are provided to illustrate the application of rules around distributing credit as an input service distributor. Case studies and clarifications related to various rules are also discussed.
Section 65(105)(zzzh) provides for a levy of service tax on services in relation to ‘construction of complex’ and an explanation was added by Finance Act, 2010.
This presentations discusses the finer aspects of how VAT was being levied on Works contract. And the controversies related to the judgement of Gannon Dunkerly, options available for deductions under VAT for composite contracts
This document discusses the concept of "place of supply" under the Goods and Services Tax (GST) in India. It begins by outlining the relevant constitutional provisions regarding taxation of inter-state supplies. It then explains what place of supply determines (whether a supply is intra-state or inter-state, and which government receives the tax) and what it does not determine (input tax credit eligibility and the person liable to pay tax).
The document goes on to provide details on the place of supply rules for different categories of goods and services as prescribed in the Integrated GST Act. This includes rules for goods involving movement, no movement, supplied on board conveyances, etc. For services, it distinguishes rules
This ppt is a comprehensive presentation on various aspects for the entities working in the construction domain. Starting from Tendering to Budgeting and going on to indirect tax aspects like VAT and service Tax.
Service tax on works contract (Pre-Negative List)sandesh mundra
This ppt gives a glimpse of service tax payment in india as applicable to works contractors before the negative list. This is very relevant to builders and developers. Service Tax posers and illustrations were also covered by the speaker during the presentation.
The document summarizes key changes being introduced in the Indian budget related to service tax including:
1. Introduction of a new 0.5% Krishi Kalyan Cess, raising the effective service tax rate to 15%. Certain education and government services being made taxable.
2. Lottery distribution and transportation of goods from overseas to India being made expressly taxable. Tax exemption for some education and construction services being removed or reduced.
3. Rates of abatement (tax reduction) being lowered for certain transport, tourism and construction services. New abatements introduced for chit funds.
4. Scope of the reverse charge mechanism for collection of tax from service recipients being expanded for all
The document discusses GST implications for works contracts and real estate transactions in India. Some key points:
- Works contracts are treated as supply of services under GST and taxed at 18%, with some works contracts taxed at 12%. Labour contracts are generally taxed at 18%.
- Builders must pay GST on sale of flats/villas if any amount is received prior to completion certificate. The rate is 18% with a 1/3 deduction for land value.
- Landlord share of construction is treated as supply of service by the builder and taxed at 18%. Valuation methods include open market value or cost.
- Landlords must also pay GST if amounts are received
Optitax's presentation on critical changes in gst law 01 feb 19Nilesh Mahajan
The Government has brought some key changes in GST law in an attempt to simplify GST further.
We have tried to capture these changes and also explained some of the changes in flow chart form for better understanding.
In this regard, please find attached Optitax’s presentation on ‘CRITICAL CHANGES IN GST LAW’
Further, the said presentation also explains levy of security services under reverse charge mechanism
This presentation discusses the intricacies involved and the modifications in the taxation of works contract in various VAT Regimes. It highlights the critical issues to be asked when a project company enters into any state for its operations.
OBJECTIVES:
Definition
Job work Procedure u/s 143 of CGST Act, 2017.
Input tax credit as per Section 16 and 19 of the CGST Act, 2017.
Other clarifications relating to Job work as per Circular No. 38/12/2017 – Central Tax dated 26th of March 2018.
The document provides an overview of the Real Estate (Regulation and Development) Act and its objectives, journey, nature and scope. It defines important terms under the Act like promoter, allottee, real estate project, and real estate agent. It outlines the key authorities established under the Act - the Real Estate Regulatory Authority and Appellate Tribunal. It discusses the functions and powers of RERA, and the process for mandatory registration of new and ongoing real estate projects, along with exemptions. It also provides details on the modus operandi for registration of projects in Telangana, including applicable fees and required documents.
The document discusses various aspects of drafting agreements. It notes that drafting involves synthesizing law and facts in language. There are broadly three types of documents that are drafted: statutory documents, conveyancing documents, and pleadings. Some key aspects of drafting that are discussed include using active voice rather than passive, avoiding unnecessary words, and structuring documents in a clear and logical manner. Specific types of agreements that are addressed include partnership agreements, retirement/dissolution agreements, gift deeds, and family settlement agreements. Execution requirements and important principles of drafting agreements are also outlined.
This document outlines guidelines for conducting long-form audit reports (LFARs) for bank branches, including the structure and important clauses to cover for assets, liabilities, income, expenses, and general matters. It discusses guidelines for auditing cash balances, advances, NPAs, deposits, profits and losses, and other assets and liabilities. The document provides details on classifying and identifying NPAs according to RBI guidelines. It emphasizes being thorough, specific, and addressing any qualifications in the LFAR and audit report.
The document discusses taxation on works contracts in India. It provides an overview of how works contracts were historically considered service contracts but a constitutional amendment allowed them to be taxed as deemed sales. It discusses various court cases that shaped the principles of works contract taxation under state VAT and central service tax. Key points covered include the definition of works contracts, methods of valuing works contracts for different taxes, and debates around classifying certain contracts as works contracts or sales.
This document provides an overview of understanding financial statements for the purposes of an audit. It discusses reviewing periods of up to 5 years, focusing on key accounting concepts like money measurement and going concern. Trial balances and balance sheets are examined in detail, including accounts, classifications, movements, and balances. Specific items like reverse charge mechanisms, reimbursements, and netting are highlighted. The tax audit report is also reviewed for depreciation, credit balances, and prior period adjustments. Other areas of focus include ratios, foreign transactions, and demands under other laws.
This document provides an overview of work contract service under Indian tax law, including:
1. It defines a works contract as a contract involving the transfer of goods that is taxable as sale of goods, for purposes like construction, installation, repair, etc. of movable or immovable property.
2. It outlines two methods for determining the taxable service portion of a works contract: by subtracting the value of goods transferred from the total amount, or by applying a percentage to the total amount.
3. It discusses CENVAT credit eligibility and the partial reverse charge mechanism for works contracts.
4. It lists certain works contracts that are exempt from service tax, such as those provided to government
The document provides an overview of the scope of taxation of services under the new service tax regime in India. It discusses key aspects like the definition of "service", declared services, bundled services and abatements. Some of the main points covered include the definition of service, the nine categories of declared services, exemptions for certain types of renting of immovable property, and clarification around taxation of services provided by employers and directors. The presentation aims to explain the broad scope of services covered under the new service tax law in India.
Case Studies of Place of Supply Including Exports-Imports and RefundsGST Law India
the following presentation enumerates a brief study on GST in case of Cross-border Air Travel, work contracts, Hotel Accommodation, Event Organization ,Immovable Property – Place of Supply & ITC Eligibility, Cross-Border Logistic Services, Cross-Border Intermediary Services, Whether Foreign Company can procure goods from India on Bill to-Ship to basis where ship to Location is India, Supply of FOC promotional material to related and unrelated parties outside India, Use of Trademark owned by Foreign-Related Company, Refund of unutilized credit accumulated due to inverted duty structure and lastly Refund of unutilized credit on zero-rated supply
Case Laws on Construction and Works contractsandesh mundra
A compilation of various Judgments of Service Tax and VAT on relevant issues in works contract and construction sector is made. Stands of High court is highlighted on complex issues arising in Constructions and taxation of works contract. A brief description of matter, appellant and petitioner's contemplation and order passed by authorities is also included to add more value.
Declared services and Classification of ServicesCA Gaurav Gupta
The document discusses declared services under service tax law in India. It defines key concepts like service, consideration, activity. It lists various declared services like renting of immovable property, construction services, transfer of intellectual property rights, IT services, agreements to refrain from an act, transfer of goods by hiring/leasing, service portion of works contracts, and service portion related to food supply. Certain renting activities are exempted like renting of residential properties, vacant land for agriculture, and renting by government bodies.
This document summarizes key judgements related to indirect taxes in the Indian construction sector. It discusses two Supreme Court cases - Bharat Sanchar Nigam Ltd. v. Union of India regarding the tax treatment of telecom products with both goods and service components, and State of Andhra Pradesh v. Kone Elevators (India) Ltd regarding whether an elevator installation contract constitutes a works contract or supply of goods. It also discusses factors to consider regarding incidental installation services and interstate works contracts. Overall, the document analyzes how different transactions involving both goods and services have been treated for indirect tax purposes.
This document provides an overview and discussion of key Cenvat Credit rules in India. It begins with definitions of key terms like input service distributor. It then examines various rules around taking and distributing Cenvat credit, including rules around reversal of credit for write-offs, conditions for credit on input services, and refund of Cenvat credit. Examples are provided to illustrate the application of rules around distributing credit as an input service distributor. Case studies and clarifications related to various rules are also discussed.
Section 65(105)(zzzh) provides for a levy of service tax on services in relation to ‘construction of complex’ and an explanation was added by Finance Act, 2010.
This presentations discusses the finer aspects of how VAT was being levied on Works contract. And the controversies related to the judgement of Gannon Dunkerly, options available for deductions under VAT for composite contracts
This document discusses the concept of "place of supply" under the Goods and Services Tax (GST) in India. It begins by outlining the relevant constitutional provisions regarding taxation of inter-state supplies. It then explains what place of supply determines (whether a supply is intra-state or inter-state, and which government receives the tax) and what it does not determine (input tax credit eligibility and the person liable to pay tax).
The document goes on to provide details on the place of supply rules for different categories of goods and services as prescribed in the Integrated GST Act. This includes rules for goods involving movement, no movement, supplied on board conveyances, etc. For services, it distinguishes rules
This ppt is a comprehensive presentation on various aspects for the entities working in the construction domain. Starting from Tendering to Budgeting and going on to indirect tax aspects like VAT and service Tax.
Service tax on works contract (Pre-Negative List)sandesh mundra
This ppt gives a glimpse of service tax payment in india as applicable to works contractors before the negative list. This is very relevant to builders and developers. Service Tax posers and illustrations were also covered by the speaker during the presentation.
The document summarizes key changes being introduced in the Indian budget related to service tax including:
1. Introduction of a new 0.5% Krishi Kalyan Cess, raising the effective service tax rate to 15%. Certain education and government services being made taxable.
2. Lottery distribution and transportation of goods from overseas to India being made expressly taxable. Tax exemption for some education and construction services being removed or reduced.
3. Rates of abatement (tax reduction) being lowered for certain transport, tourism and construction services. New abatements introduced for chit funds.
4. Scope of the reverse charge mechanism for collection of tax from service recipients being expanded for all
The document discusses GST implications for works contracts and real estate transactions in India. Some key points:
- Works contracts are treated as supply of services under GST and taxed at 18%, with some works contracts taxed at 12%. Labour contracts are generally taxed at 18%.
- Builders must pay GST on sale of flats/villas if any amount is received prior to completion certificate. The rate is 18% with a 1/3 deduction for land value.
- Landlord share of construction is treated as supply of service by the builder and taxed at 18%. Valuation methods include open market value or cost.
- Landlords must also pay GST if amounts are received
Optitax's presentation on critical changes in gst law 01 feb 19Nilesh Mahajan
The Government has brought some key changes in GST law in an attempt to simplify GST further.
We have tried to capture these changes and also explained some of the changes in flow chart form for better understanding.
In this regard, please find attached Optitax’s presentation on ‘CRITICAL CHANGES IN GST LAW’
Further, the said presentation also explains levy of security services under reverse charge mechanism
This presentation discusses the intricacies involved and the modifications in the taxation of works contract in various VAT Regimes. It highlights the critical issues to be asked when a project company enters into any state for its operations.
OBJECTIVES:
Definition
Job work Procedure u/s 143 of CGST Act, 2017.
Input tax credit as per Section 16 and 19 of the CGST Act, 2017.
Other clarifications relating to Job work as per Circular No. 38/12/2017 – Central Tax dated 26th of March 2018.
The document provides an overview of the Real Estate (Regulation and Development) Act and its objectives, journey, nature and scope. It defines important terms under the Act like promoter, allottee, real estate project, and real estate agent. It outlines the key authorities established under the Act - the Real Estate Regulatory Authority and Appellate Tribunal. It discusses the functions and powers of RERA, and the process for mandatory registration of new and ongoing real estate projects, along with exemptions. It also provides details on the modus operandi for registration of projects in Telangana, including applicable fees and required documents.
The document discusses various aspects of drafting agreements. It notes that drafting involves synthesizing law and facts in language. There are broadly three types of documents that are drafted: statutory documents, conveyancing documents, and pleadings. Some key aspects of drafting that are discussed include using active voice rather than passive, avoiding unnecessary words, and structuring documents in a clear and logical manner. Specific types of agreements that are addressed include partnership agreements, retirement/dissolution agreements, gift deeds, and family settlement agreements. Execution requirements and important principles of drafting agreements are also outlined.
This document outlines guidelines for conducting long-form audit reports (LFARs) for bank branches, including the structure and important clauses to cover for assets, liabilities, income, expenses, and general matters. It discusses guidelines for auditing cash balances, advances, NPAs, deposits, profits and losses, and other assets and liabilities. The document provides details on classifying and identifying NPAs according to RBI guidelines. It emphasizes being thorough, specific, and addressing any qualifications in the LFAR and audit report.
The document discusses the benefits of exercise for mental health. Regular physical activity can help reduce anxiety and depression and improve mood and cognitive functioning. Exercise causes chemical changes in the brain that may help boost feelings of calmness, happiness and focus.
This document provides guidance on accounting for real estate transactions according to an Indian accounting standard. It discusses the types of accounting issues involved, including revenue and profit recognition. It recommends using the percentage of completion method to recognize revenue over time as a project is constructed, provided certain conditions are met like total revenues and costs can be reliably estimated. It provides details on calculating revenue based on project costs incurred and disclosure requirements. The guidance applies to a range of real estate transactions and provides a sample note on revenue recognition policies.
This document discusses changes and issues related to tax audits in India. It summarizes key sections of the Indian Income Tax Act related to tax audits for small businesses and individuals. Section 44AD allows eligible small businesses and individuals to pay tax at 8% of gross receipts if turnover is less than Rs. 1 crore. Section 44AB mandates tax audits if total income exceeds a threshold. The document provides guidance on determining taxable turnover for different business types and compliance requirements for tax audit reports.
This document discusses various cybersecurity topics including securing networks, protecting data and systems from intrusions and attacks, and ensuring availability, integrity, and confidentiality of resources. It provides tips for securing file servers, routers, and peripherals through measures like changing default passwords, enabling firewalls and filters, implementing access controls and privileges, and keeping systems updated. The document also recommends configuring offline cloud backups and maintaining a second copy of important files.
Cloud computing is the delivery of computing resources such as servers, storage, databases, networking, software, analytics and more over the Internet ("the cloud"). It enables companies to scale up as needed and pay only for resources used. Key aspects include virtualization, utility computing, and service-oriented architecture. Details are abstracted from consumers, who no longer need expertise in or control over the underlying technology infrastructure. Cloud computing provides dynamically scalable and often virtualized resources delivered over the Internet.
This document discusses various provisions related to tax deduction and collection at source in India. It covers sections 192-195 of the Income Tax Act which deal with TDS on salary, interest, contracts, commission, rent, professional fees and payments to non-residents. It also discusses section 206C dealing with tax collection at source and the penal consequences for non-compliance with these TDS and TCS provisions.
Incorporation and administration ca 2013Dhruv Seth
This document summarizes key provisions around incorporation of private companies under the Companies Act 2013. It outlines new requirements around incorporation, memorandum and articles of association, registered office, and important sections that now apply to private companies, such as around acceptance of deposits, director appointments, financial reporting, and corporate social responsibility. Private companies must now also obtain shareholder approval via special resolution for significant matters like selling assets or borrowing large amounts.
This document provides an overview of analyzing financial statements. It covers legal forms of business, basic accounting principles, components of financial statements like the balance sheet, income statement, and cash flow statement. It discusses understanding key elements of these statements like assets, liabilities, equity, revenue and expenses. It also describes ways to decipher financial information through ratio analysis, cash flow analysis and notes to the accounts. Examples are provided on how to evaluate companies for investment and analyze changes in income statement accounts over time.
Applicability of accounting standards to income tax actDhruv Seth
This document discusses the applicability of accounting standards to the Income Tax Act of 1961 in India. It outlines the various statutory provisions and accounting standard authorities, as well as key judicial pronouncements that have established that accounting standards must be followed and applied when determining taxable income, even if the standards have not been directly notified under the Income Tax Act. However, some differences still exist between accounting and tax treatments in certain areas such as inventory valuation, prior period adjustments, and impairment of assets. Overall convergence of the Income Tax Act and accounting standards continues to progress in India.
This document discusses financial ratio analysis, which involves establishing quantitative relationships between financial statement items to analyze a company's financial position, performance, and trends over time. It provides definitions and formulas for various types of ratios, including liquidity, solvency, activity, and profitability ratios. Examples are given to demonstrate how to calculate and interpret common ratios like current ratio, acid test ratio, debt-to-equity ratio, and return on assets. The document aims to explain ratio analysis as a tool for evaluating the strengths and weaknesses of a business.
The document discusses key insights from India's new Direct Tax Code, including consolidating all direct taxes into a single act with less explanations and more extensive use of tables. Some highlights are restricting the definition of income from house property to only include residential property, disallowing CSR expenditure, changing how holding periods are calculated for property, and increasing the medical allowance deduction while reducing the return filing time.
This document discusses computer-assisted audit techniques (CAAT) and the use of Excel for CAAT. It defines CAAT and explains why they are used in auditing, noting benefits like handling large transaction volumes and providing an audit trail. The document outlines different CAAT techniques like auditing around and through computers. It also describes the capabilities of CAAT like importing various data formats and performing statistical analysis. Finally, the document provides examples of how CAAT and Excel can be used for auditing tasks like exception identification, control analysis, and error identification in areas like accounts payable, accounts receivable, and the general ledger.
The document provides an overview of accounting standards in India. It discusses the background and authority of accounting standards set by the Institute of Chartered Accountants of India (ICAI). It also summarizes key compliance standards such as AS-2 on valuation of inventories, AS-6 on accounting for depreciation, and AS-9 on revenue recognition. Additionally, it covers reporting standards including AS-3 on cash flow statements, AS-13 on accounting for investments, and AS-18 on related party disclosures.
This document discusses data mining and forensic auditing. It defines data mining as using computer techniques to analyze large amounts of data to identify patterns and relationships. Data mining can help auditors identify suspicious transactions by analyzing patterns in areas like computer usage, purchases, and employee data. Forensic auditing investigates potential fraud and uses accounting skills and tools to analyze financial information for legal cases. The document outlines different types of fraud, profiles of potential fraudsters, and specialized tools and techniques auditors can use to detect fraud, such as Benford's Law and other Excel functions.
Excel as a potent forensic accounting toolDhruv Seth
This document discusses the use of Excel as a forensic auditing tool. It covers what forensic audits are and how they differ from normal audits. Forensic audits are used to investigate fraud and embezzlement and analyze financial information for legal proceedings. They take a more focused, micro approach compared to standard audits. The document outlines various tools available in Excel for forensic auditing, such as duplicate detection, gap detection, and ratio analysis. It provides examples of how tools like the Ratio of Largest to Second Largest and Benford's Law can help detect errors, fraud, and fudging of financial statements. Limitations of using Excel for forensic audits are also briefly discussed.
The document provides an overview of service tax in India, including key sections of the law. It discusses the old and new charging provisions, with the new provision under Section 66B applying a negative list approach to taxation. Services are taxed unless they are specified in the negative list, which exempts essential services related to food, housing, education, funerals, and transportation, as well as services provided by governments. The overview explains concepts like consideration, the definition of service, and place of provision, and provides details on related rules and sections governing valuation, payment, returns, and penalties.
The document provides an overview of service tax provisions in India including key sections and rules. It summarizes the old and new charging provisions under sections 66 and 66B. It explains the concept of negative list and lists various services excluded from service tax. It also describes declared services covered under service tax. Finally, it discusses the need for and overview of place of provision of services rules for determining where a service is provided in the taxable territory of India for service tax purposes.
Seminar on Service Tax at Jaipur on 20.4.2013(Session ii)Agarwal sanjiv & Co
This document discusses the scope of taxation of services under the new service tax regime in India. It defines what constitutes a service according to law. It outlines the key aspects of a service such as the requirement for an activity to be carried out for consideration. It also describes the nine categories of declared services that are explicitly included in the scope of service tax. Finally, it provides examples of activities that may now be taxed under the new regime.
The document summarizes key aspects of service tax valuation in India according to Section 67 of the Finance Act, 1994. It discusses how consideration is defined, the new charging provision for service tax, and jurisprudence around composite contracts, valuation of specific services like freight and security deposits, and the treatment of consideration paid in money versus in kind. It also outlines the determination of value according to various circumstances and exceptions provided in the Service Tax Determination of Value Rules, 2006.
The document summarizes key aspects of the introduction of service tax version 2.0 in India through the Finance Act of 2012, which introduced a negative list approach to taxation of services.
Some key points include:
- Service tax revenue has grown significantly over time, with a record 37% growth in FY 2011-12.
- The new system aims to provide clearer definitions and reduce gaps and loopholes to improve tax collection.
- A "service" is defined as an activity carried out for consideration, which can be monetary or non-monetary.
- Various rules are provided to determine the location or "place of provision" of different types of services.
- A negative list of 17 services
This document provides an overview of service tax law in India. Some key points:
- Service tax was first introduced in 1994 and now covers all services except those in the negative list.
- It is levied on the value addition from the provision of services within India.
- Various rules determine the taxable person, valuation of services, point of taxation, and place of provision of services.
- There are nine types of declared taxable services and 17 services exempted under the negative list.
- The document outlines some of the major provisions and rules under the service tax laws.
This document provides an overview of the scope of taxation of services under the new service tax regime in India. It discusses key aspects such as the definition of "service", exclusions and inclinations, charge of service tax, declared services, and bundled services. The presentation covers topics like the meaning of service, consideration, persons, activities that constitute a service, negative list of services, exemptions, and taxability of various services and transactions.
The document defines and summarizes the term "service" under the new Goods and Services Tax (GST) regime in India. It states that service is now defined under Section 66B(44) and means any activity carried out by one person for another for consideration, including declared services. However, it excludes activities that constitute transfers of goods or immovable property, money or actionable claims, or services provided by an employee to an employer. The definition includes three parts - the means part which defines any activity for consideration, the includes part which lists declared services, and the shall not include part which lists exempted activities.
Service tax is a tax levied by the Central Government of India on taxable services. The key points are:
1. Service tax is levied on services provided or agreed to be provided in India excluding those under the negative list. The point of taxation is determined based on when the invoice is issued or payment is received, as per the Point of Taxation Rules.
2. The place of provision of services rules determines whether a service is provided in India based on factors like where the service is performed, the location of the recipient or provider, or where immovable property is located.
3. The constitution provides the authority to levy service tax under Entry 92C of the Union List. The tax
The document provides information on service tax in India, including:
1. Service tax collections have risen steadily since 1994 from Rs. 410 crores to Rs. 132518 crores in 2012-13, with the number of taxable services increasing from 3 to 119.
2. To determine if a service is taxable, it must first be established that it is a service as defined in law. It then must pass a three tier test involving the negative list and exemptions.
3. For an activity to be considered a service, it must be an activity carried out by one person for another for consideration, excluding certain specified transactions like money or goods.
Service Tax is an indirect tax imposed on specified taxable services in India. It is defined in Section 65B of the Finance Act and excludes certain activities like the sale of goods, money transactions, and services provided by employees. Every provider of taxable services must register for Service Tax by filing Form ST-1 within 30 days. There is a "negative list" of 17 services that are exempt from Service Tax. The goal of Service Tax is to reduce taxes on manufacturing and trade while still generating government revenue.
This document discusses the changes to service tax laws in India that took effect on July 1, 2012, moving from a positive list system to a negative list system. Key points include:
1) Service tax coverage was expanded by defining "service" and taxing all services except those specified in a negative list of exemptions.
2) The number of taxable services was reduced and definitions were simplified compared to the previous system which had over 100 taxable services.
3) A works contract is taxable only on the service portion, with set valuations to determine this portion.
4) Certain services involve reverse charge mechanism where the liability shifts entirely or partially to the service recipient.
5)
This document provides an overview of key concepts related to the Goods and Services Tax (GST) regime in India, including the concept of supply, nature of supply, GST rates and exemptions, input tax credit, returns, documentation, and tax deducted at source. It defines supply, explains the dual GST structure of CGST and SGST/IGST, and clarifies whether transactions constitute intra-state or inter-state supply. Schedules are referenced that specify activities treated as supply and clarify supply of goods versus services. The time of supply is also summarized based on the type of transaction.
Workshop on Understanding the Amended law of Service Tax dated 29.08.2014 Ses...Agarwal sanjiv & Co
The document presents an overview of the key changes to India's service tax law as amended in 2014, including:
- Service tax now applies to all services by default, except those specified in the negative list or exempted. Previously only certain specified services were taxable.
- There are now 17 categories of services specified in the negative list that are not subject to service tax.
- Several other changes were made, such as directors' services to companies now being taxable under service tax.
The workshop aimed to educate participants on understanding the amended service tax law and highlighted major provisions around the definition of taxable services, the negative list approach, exemptions and other key changes introduced in the 2014 budget.
The document discusses key aspects of service tax in India such as:
1) Service tax was introduced in 1994 and is an indirect tax levied on services by the Central Government.
2) It is administered by the Central Excise Department and the rate has increased over time from 5% in 1994 to 15% in 2016.
3) From 2012, India adopted a negative list for service tax whereby all services except those specified in the negative list are taxable.
4) Assessees above a certain threshold must register and pay service tax, with penalties for non-compliance.
The document summarizes key amendments made to various sections of the CGST Act, 2018 through the CGST (Amendment) Act, 2018. Some of the key amendments include expanding the scope of supply, allowing input tax credit for goods/services received by the registered person even if not physically received, increasing the threshold for composition scheme to Rs. 1.5 crores, and clarifying the treatment of input tax credit for motor vehicles and vessels/aircrafts used for transportation.
Meaning of the term "Service" in Service tax as per Finance Act, 1994Abhinav Chhabra
A comprehensive analysis of the definition of the term "Service" as per Finance Act, 1994. This presentation will guide about what all are the services that can be liable to service tax subject to other provisions of the Finance Act, 1994.
This document provides an overview of service tax provisions in India, including:
1. It discusses the shift in India's service tax approach from a selective positive list to a comprehensive negative list in 2012.
2. It outlines key aspects of the new service tax framework including the definition of taxable services, exemptions, place of provision rules, and the reverse charge mechanism.
3. It summarizes major changes introduced in the 2012-2013 budget and Finance Act related to service tax compliance requirements and penalties.
The document discusses key aspects of the Goods and Services Tax (GST) in India, including:
1. It defines the scope of supply under GST to include all forms of supply of goods and services for consideration in the course of business. It also covers import of certain services.
2. It outlines various types of supplies - taxable supplies, exempt supplies, non-taxable supplies, deemed exports and import of goods/services.
3. It provides details around composition scheme under GST for small businesses with turnover up to Rs. 50 lakhs, including lower tax rates, exemption from maintaining detailed records and paying tax under reverse charge.
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The document provides guidelines for general insurance policies, including important points to consider when taking out a policy or making changes. Key guidelines include ensuring all business locations are specified accurately in the policy, sums insured reflect the true value of assets, and clauses are included to ensure coverage of items not explicitly named. It also recommends reviewing policies annually and consulting an insurance advisor for specialized risks or large policies.
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Attached is the compilation of the various prohibitions under the Income Tax Act which pertain to cash transactions. Please ensure your books comply with this to avoid penal consequences.
Our team has compiled the various sections applicable in Income Tax which are applicable to the Real Estate sector. Synopsis of the sections and a brief understanding is attached for your perusal.
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Happy to share the first update on GST on Goods Transport Agency. This impacts all of us since the tax under GTA is payable by us on the reverse charge basis.
Please note this is not a very detailed writeup covering every aspect of the law. This is for basic general reading and presents a broad outline. If you have any specific query then please feel free to reach out to us for a solution.
S&A Knowledge Series - Company fresh start scheme 2020Dhruv Seth
The Ministry of Corporate Affairs has come out with a great scheme of regularising any defaults under the Companies Act and LLP Act. If you have any Company or an LLP which has been defaulting due to any reason can avail this scheme and regularise it. They have waived off any additional filing fee or prosecution under the relevant law (if not initiated).
A writeup on the schemes is attached detailing the applicability and other broad contours.
S&A Knowledge Series - Sec 50C implications under income tax actDhruv Seth
Please find attached a writeup on Sec 50C of the Income Tax Act, 1961 with the latest amendments of the Finance Act 2020.
Sec 50C deals with the deemed income under the Income Tax Act in case of the difference between actual sale value and the defined circle rate value. This section applies only to capital gains and not to business assets such as closing stock.
S&A Knowledge Series - Budget & budgetary controlsDhruv Seth
In continuation of our knowledge series please find attached an update on "Budgets and Budgetary Controls".
In light of the current humanitarian and possible economic turmoil, it becomes imperative for us to have an effective budget and controls for the same. This would ensure we stick to our expenses envisaged at the start of the year and exercise great control over our costs.
S&A Knowledge Series - Important Disallowances under sec 40A income taxDhruv Seth
Section 40A of the Income Tax Act specifies certain expenses that are not allowed as deductions when computing taxable income. This includes excessive or unreasonable payments made to relatives, and cash payments exceeding Rs. 10,000 for most expenses or Rs. 35,000 for vehicle leasing expenses. There are some exceptions such as payments made to banks or the government. The section aims to prevent overstating expenses to reduce tax liability by disallowing fabricated payments or excessive related party transactions not at arm's length.
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With the recent changes in the taxation rates of Companies, we are attaching a tabular presentation of the same for easier reading and understanding.
This would enable you to decipher which option might be more beneficial for you to lower your tax outgo. Please note these clauses only applies to Companies and not to other forms of businesses.
We are excited to share our annual Clients Circular on the amendments by Finance Act 2020.
The writeup covers important amendments that impact you directly and consciously we have avoided to mention the amendments which are procedural in nature. This writeup we believe would help you in complying with the law during the new financial year now underway.
Do get back to us if you have any questions and we would be delighted to help you out.
S&A knowledge series - Financial assistance to startupDhruv Seth
We are delighted to share with you a few of the new schemes which have been pronounced by financial institutions in the wake of COVID-19. While few are applicable to eligible startups the others can be availed by general MSMEs subject to conditions.
SIDBI COVID-19 Startup Assistance Scheme
ISBA Centre for Augmenting WAR with COVID-19 Health Crisis
S&A knowledge series - Financial assistance to MSMEDhruv Seth
SIDBI Assistance to Facilitate Emergency response against coronavirus
SIDBI Assistance to Facilitate Emergency response against coronavirus Plus
Technology Development Board- Proposal for Fighting Covid-19
The document summarizes key proposals from the Indian Union Budget 2018-19. Some highlights include:
- Long term capital gains tax of 10% introduced for gains over Rs. 1 lakh from sale of equity shares.
- Standard deduction of Rs. 40,000 introduced for salary income.
- Tax benefits for startups extended and eligibility criteria expanded.
- Corporate tax rate reduced to 25% for companies with turnover up to Rs. 250 crores.
- Several goods and services brought under lower GST rates of 5%, 12%, and 18%.
The fascinating world of cryptocurrency. How will it impact you, the accountants, the regulators and the taxman? An insight into the world with special emphasis in Indian context
This document discusses the impact of digitization and disruptive technologies on accounting and assurance practices. Key points include:
- Automation of accounting functions through bots and use of APIs for business communications will reduce human intervention and paperwork.
- The rise of artificial intelligence, analytics, and IoT will transform how accounting data is collected, organized, and validated in real-time.
- Future assurances will rely more on continuous monitoring, predictive analysis, and real-time auditing using tools like data mining and algorithmic risk assessment.
- Accountants must build capacity to work with new digital technologies like blockchain, cryptocurrency, big data, and artificial intelligence to provide services in an increasingly digital business environment.
The document summarizes key provisions of the Real Estate (Regulation and Development) Act 2016 in India. Some important considerations before and after launching a real estate project include registering the project with RERA, maintaining separate bank accounts for funds collected, adhering to sanctioned plans, obtaining necessary approvals, forming an association of allottees, and executing agreements for sale and conveyance deeds. The promoter must comply with obligations regarding insurance, refunds, compensation and more to protect consumer interests in the real estate sector.
This document defines key terms related to e-commerce and GST in India. It outlines different e-commerce models and explains that under GST all would be considered e-commerce operators. It discusses tax liability for different transaction types on e-commerce platforms. Finally, it notes some foreseeable challenges for e-commerce marketplaces under GST compliance requirements like TCS, database maintenance, valuation, and reconciliation.
Your guide on the most crucial pillar of GST - Input Tax Credit.
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Capital Punishment by Saif Javed (LLM)ppt.pptxOmGod1
This PowerPoint presentation, titled "Capital Punishment in India: Constitutionality and Rarest of Rare Principle," is a comprehensive exploration of the death penalty within the Indian criminal justice system. Authored by Saif Javed, an LL.M student specializing in Criminal Law and Criminology at Kazi Nazrul University, the presentation delves into the constitutional aspects and ethical debates surrounding capital punishment. It examines key legal provisions, significant case laws, and the specific categories of offenders excluded from the death penalty. The presentation also discusses recent recommendations by the Law Commission of India regarding the gradual abolishment of capital punishment, except for terrorism-related offenses. This detailed analysis aims to foster informed discussions on the future of the death penalty in India.
Corporate Governance : Scope and Legal Frameworkdevaki57
CORPORATE GOVERNANCE
MEANING
Corporate Governance refers to the way in which companies are governed and to what purpose. It identifies who has power and accountability, and who makes decisions. It is, in essence, a toolkit that enables management and the board to deal more effectively with the challenges of running a company.
4. COVERAGE OF THIS PRESENTATION
•Overview of Indian Tax structure
•Importance of Service Tax
•Definition of “Service”
•Definition of “Declared Service”
•Draft Place of provision of service rules
5.
6. POWER TO LEVY
•Article 265 – No tax shall be levied or collected
except by the authority of law
•Article 246 – Distributes legislative powers
•Schedule VII - List I – Center List (97)
List II – State List (66)
List III – Concurrent List (47)
7. POWER TO LEVY
Union List State List Concurrent
Income Tax Taxes on Land, Building
Stamp duties other
than duties or fees
collected by means
of judicial stamps,
but not including
rates of stamp duty
(Entry No. 44)
Customs Entry Tax
Excise Excise on Liquor etc
Corporation Tax Tolls
CST VAT
Service Tax Luxury Tax
Stamp Duty on
BOE, Cheques etc.
Stamp Duty on documents
other than those in List I
8. DIRECT VIS-À-VIS INDIRECT TAX COLLECTION
Budgeted
2012-13
Revised
2011-12
Actual
2010-11
Actual
2009-10
Actual
2008-09
15. MOST TRENDING SERVICES
Service 2010-11 2011-12 % Growth
Construction Residential Complex 1,145.63 2,681.67 234.08%
Air passenger transport service 693.04 1,273.09 183.70%
Transport of goods through pipeline 394.34 718.95 182.32%
Broadcasting 1,084.14 1,785.83 164.72%
Credit Card, Debit Card 437.01 697.79 159.67%
Business Support Service 2,688.86 4,197.33 156.10%
Information technology 1,742.53 2,641.24 151.58%
Airport Services 608.44 902.12 148.27%
Advertising 794.29 1,163.11 146.43%
Renting of immovable property 2,829.24 4,119.92 145.62%
18. DETERMINATION
Service
Sec 65B (44) ?
Declared Service
Sec 66E ?
NO
NOYES
Negative List
Sec 66D ?
YES
Exemption
12/2012 ?
NO
YES
Not
Taxable
YES
TaxableNO
19. 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
66B – CHARGING SECTION
20.
21. 65B(44) – FLOW CHART
Basic Provision
Includes
Exclusions
Further exclusions vide Explanation 1
Explanation 2
Explanation 3 - Deeming
Explanation 4
22. any activity carried out by a
person for another for
consideration and includes a
declared service but shall not
include….
65B (44) - SERVICE MEANS
23. 65B (44) - ESSENTIALS
Service
activity
a person for another
consideration
declared service
24. • Busy or vigorous action or movement
• The state or quality of being active
• Lively action or movement
ACTIVITY
25. Activity could be active or passive and
would also include forbearance to act.
Agreeing to the obligation to refrain from
an act or to tolerate an act or a situation
has also been specified as a declared
service under section 66E of the Act.
GUIDANCE NOTE 2 – WHAT IS ACTIVITY?
26. • Necessary to have two persons
• Has to be carried out for the other
person
• Caveat - Explanation 2(a) of 65B(44)
A PERSON FOR ANOTHER
27. (i) an individual,
(ii) a Hindu undivided family,
(iii) a company,
(iv) a society,
(v) a limited liability partnership,
(vi) a firm,
(vii) an AOP or BOI, whether incorporated or not,
(viii) Government,
(ix) a local authority, or
(x) every artificial juridical person, not falling within any of
the preceding sub-clauses;
SEC 65B(37) - PERSON
28. When, at the desire of the promisor, the promisee or
any other person has done or abstained from doing,
or does or abstains from doing, or promises to do or
to abstain from doing, something, such Act or
abstinence or promise is called a consideration for
the promise
CONSIDERATION - SEC 2(D)
29. • Gifts or Donation
• Research
• Charity
SPECIAL CONSIDERATION
30. 65B(44) – FLOW CHART
Basic Provision
Includes
Exclusions
Further exclusions vide Explanation 1
Explanation 2
Explanation 3 - Deeming
Explanation 4
31. ...but shall not include
a.) an activity which constitutes merely –
(i) a transfer of title in goods or
immovable property, by way of sale, gift
or in any other manner; OR
65B (44) - SERVICE CONTINUED
32. ii.) such transfer, delivery or supply of any
goods which is deemed to be a sale
within the meaning of clause (29A) of
article 366 of the Constitution; OR
iii.) a transaction in money or actionable
claim
65B (44) - SERVICE CONTINUED
33. b.) a provision of service by an employee to
the employer in the course of or in
relation to his employment ;
c.) fees taken in any court or tribunal
established under any law for the time
being in force.
65B (44) - SERVICE CONTINUED
34. 65B(44) – FLOW CHART
Basic Provision
Includes
Exclusions
Further exclusions vide Explanation 1
Explanation 2
Explanation 3 - Deeming
Explanation 4
35. Nothing in this clause shall apply to
a.) M.P. / M.L.A. / Local authorities
b.) Person holding post pursuance to the
provisions of the Constitution
c.) Chairperson / Member / Director of a
body established by the CG / SG
65B (44) – EXPLANATION 1
36. Transaction in money shall not include any
activity relating to the use of money for
conversion by cash or by any other mode,
from one form, currency or denomination, to
other form, currency or denomination for
which a separate consideration is charged.
65B (44) – EXPLANATION 2
37. a.) an unincorporated association or a body
of persons, as the case may be, and a
member thereof shall be treated as
distinct persons.
b.) an establishment of a person in the taxable
territory and any of his other establishment
in a non taxable territory shall be treated as
establishment of distinct persons.
65B (44) – EXPLANATION 3
38.
39. Sec 65B (22) of the Finance Act, 1994
“Means any activity carried out by a
person for another person for
consideration and declared as such in
Section 66E”
DECLARED SERVICE
40. a. Renting of Immovable Property
b. Construction of a complex, building
c. Temporary transfer of IPR
d. Development, design etc. IT Software
e. Agreeing to refrain or tolerate
SECTION 66E
41. f. Transfer of goods without transfer of
right of such goods
g. Activities in relation to hire purchase
h. Service portion in execution of
Works Contract
i. Service portion of food being served
SECTION 66E
42. Renting of Immovable Property
- Sec 66D(M) – Negative List –
Renting of residential dwelling
for use of residence
SECTION 66E (a)
43. Agreeing to the obligation
to refrain from an act OR
to tolerate an act or a situation OR
to do an act.
SECTION 66E (e)
44. Transfer of goods by way of hiring,
leasing, licensing, or in any manner
such manner without transfer of
right to use such goods.
SECTION 66E (f)
45. BSNL Vs. UOI (2006) 145 STC 91 (SC)
a) There must be goods available for delivery
b) The identity of the goods must be certain
c) All permissions and license required should be
available to the transferee
d) It must be a transfer of right to use and not
merely a license to use the goods
e) The owner cannot transfer the right to anyone
else till it is with the original transferee
TRANSFER OF RIGHT - TESTS
46. Activities in relation to delivery of
goods on hire purchase or any
system of payment by installments.
SECTION 66E (g)
47. Service portion in the execution of a
works contract
- Works contract definition 65B(54)
- Notification 24/2012 dated 06-06-
2012 superseding 11/2012
SECTION 66E (h)
48. a.) Pay on service portion of contract
OR
SECTION 66E (h)
Works Contract Value of Service portion
Original Works contract 40% of the total amount
Maintenance or repair or
servicing of any goods
70% of the total amount
All other works contract 60% of the total amount
49.
50. 66F. (1) Unless otherwise specified, reference
to a service (herein referred to as main
service) shall not include reference to a service
which is used for providing main service.
(2) Where a service is capable of differential
treatment for any purpose based on its
description, the most specific description shall
be preferred over a more general description.
SEC 66F – BUNDLED SERVICE
51. Explanation.— For the purposes of sub-
section (3), the expression "bundled service"
means a bundle of provision of various
services wherein an element of provision of
one service is combined with an element or
elements of provision of any other service or
services.’;
SEC 66F – BUNDLED SERVICE
52. a. if various elements of such service are naturally
bundled in the ordinary course of business, it shall
be treated as provision of the single service which
gives such bundle its essential character;
b. if various elements of such service are not
naturally bundled in the ordinary course of
business, it shall be treated as provision of the
single service which results in highest liability of
service tax.
SEC 66F – BUNDLED SERVICE
53.
54. Term “Sale” as in 4(3) of the Sale of
Goods Act, 1930
• “where under a contract of sale the
property in the goods is transferred
from the seller to the buyer, the
contract is called a sale.”
SERVICE VIS-À-VIS SALE
55. In 'State of Punjab and Haryana V. Associated Hotels
of India Limited' - AIR 1972 SC 1131 the Supreme
Court held that a contract for sale is one whose
main object is the transfer of property in, and the
delivery of the possession of a chattel as a chattel to
the buyer. Where the principal object of the work
undertaken by the payee of the price is not the
transfer of a chattel, the contract is one of work and
labor.
SERVICE VIS-À-VIS SALE
56. Important traits
1.) Transfer of property as a chattel
2.) When the property in the transaction passes
3.) Identifiable existence prior to delivery
4.) Proportion of value of material and service
5.) Substance and not the form
SERVICE VIS-À-VIS SALE
57. Sec 66D(f) – Negative List - Any process amounting to
manufacture or production of goods
Sec 65B(40) of the Finance Act
“Process amounting to manufacture or production of
goods” means a process on which duties of excise are
leviable under Sec 3 of the Central Excise Act, 1944 or
any process amounting to manufacture of narcotics on
which duties are leviable under the state act”
SERVICE VIS-À-VIS MANUFACTURE
58. • Sec 3 of the Central Excise Act, 1944
(a) a duty of excise to be called the Central
Value Added Tax (CENVAT)] on all excisable
goods (excluding goods produced or
manufactured in special economic zones)
which are produced or manufactured in
India
SERVICE VIS-À-VIS MANUFACTURE
59. • Manufacture Sec 2f of Central Excise
• UOI vs. DCM AIR 1963 SC 791 SC
“manufacture implies a change but every
change is not manufacture. A new and
different article must emerge having a
distinctive name, character or use”
SERVICE VIS-À-VIS MANUFACTURE
60. • Deemed manufacture is not covered by the
above
• Over 35 processes have been specified or (b)
Repacking, relabeling, putting or altering MRP
in case of articles covered under MRP
valuation provisions [clauses (ii) and (iii) of
section 2(f) of Central Excise Act]
SERVICE VIS-À-VIS MANUFACTURE
61.
62. • Levy tax based on jurisdiction of consumption
• Do not charge tax on Export of services
• Levy tax on Import of services
• Avoid taxation in multiple jurisdictions
• Avoid non-taxation in all jurisdictions
• Tax B2B - based on location of customers
• Tax B2C - based on location of service providers
BASIC TAXING PHILOSOPHY – POP 2012
63. Location of Service Receiver and Provider
- Registered - its location is the registered premises
- Not registered - its location could be:
a) Business establishment; OR
b) Fixed establishment; OR
c) Business / Fixed Establishment most directly
concerned with use / provision of service; OR
d) Usual place of residence / place of incorporation
BASIC TAXING PHILOSOPHY – POP 2012
64. LOCATION – POP 2012
Registered
in India
Location is India
Yes
Business
Establishment ?
No
No
Fixed
Establishment ?
No
Usual Place of
Residence - India ?
No
Location not India
Fixed Establishment
abroad ?
Yes
Establishment more
directly concernedYes
Location would be
business establishmentNo
Another Fixed
Establishment ?
Yes
Establishment more
directly concerned
Yes
Fixed Establishment
No
Location is India
Yes
65. Rule 3 - Place of provision generally
The place of provision of a service shall be the
location of the service receiver;
Provided that in case the location of the service
receiver is not available in the ordinary course of
business, the place of provision shall be the
location of the service provider.
BASIC RULES – POP 2012
66. Rule 8 - Place of provision of services where provider
and receiver are located in taxable territory
Place of provision of a service, where the location of the
service provider as well as that of the service receiver is
in the taxable territory, shall be the location of the service
receiver.
BASIC RULES– POP 2012
67. Rule 14 - Order of application of rules
Notwithstanding anything stated in any rule,
where the provision of a service is, prima facie,
determinable in terms of more than one rule, it
shall be determined in accordance with the rule
that occurs later among the rules that merit equal
consideration.
BASIC RULES – POP 2012
68. STRUCTURE – POP 2012
Particulars Description Rule
Location of
Service Receiver
General Rules 3, 8 & 14
Location of
Service Provider
Where location not
available
Specific Rule for five
specified
Proviso – 3
9
Various Other Specific Rules for seven
specified services
4 to 6, 7,
10 to 12
69. The place of provision of following services shall
be the location where the services are actually
performed, namely -
1.) Goods Physically made available by receiver
EXCEPT – E-SERVICES where goods located
2.) Supply of goods along with service
3.) Service in physical presence of individual
RULE 4 – POP 2012
70. The place of provision of services provided directly in
relation to an immovable property, including services –
• Experts and estate agents
• Provision of hotel accommodation
• grant of rights to use immovable property,
• services for carrying out or coordination of
construction work, including architects / int. decorators
shall be the place where the immovable property is
located or intended to be located.
RULE 5 – POP 2012
71. The place of provision of services provided by way of
admission to, or organization of –
• a cultural, artistic, sporting, scientific, educational,
or entertainment event,
• or a celebration, conference, fair, exhibition,
• or similar events, and of services ancillary to such
admission,
shall be the place where the event is actually held.
RULE 6 – POP 2012
72. Where any service referred to in rules 4, 5, or 6 is
provided at more than one location, including a
location in the taxable territory, its place of
provision shall be the location in the taxable
territory where the greatest proportion of the
service is provided.
RULE 7– POP 2012
73. The place of provision of following services shall be the
location of the service provider:-
• Services provided by a banking company to account
holders;
• Telecommunication services provided to subscribers;
• Online information and database access or retrieval
services;
• Intermediary services;
• Service consisting of hiring of means of transport, upto
a period of one month.
RULE 9 (SPECIFIED SERVICES) – POP 2012
74. Rule 10. The place of provision of services of
transportation of goods, other than by way of mail or
courier, shall be the place of destination of the goods:
Provided that the place of provision of services of goods
transportation agency shall be the location of the person
liable to pay tax.
Rule 11. The place of provision in respect of a passenger
transportation service shall be the place where the
passenger embarks on the conveyance for a continuous
journey.
RULE 10 & 11– POP 2012
75. Place of provision of services provided on board a
conveyance
Place of provision of services provided on board a
conveyance during the course of a passenger
transport operation, including services intended to be
wholly or substantially consumed while on board,
shall be the first scheduled point of departure of that
conveyance for the journey.
RULE 12– POP 2012
76. Powers to notify description of services or
circumstances for certain purposes.
In order to prevent double taxation or non-taxation of
the provision of a service, or for the uniform
application of rules, the Central Government shall
have the power to notify any description of service or
circumstances in which the place of provision shall be
the place of effective use and enjoyment of a service.
RULE 13– POP 2012
Earlier it read “immovable property for use in the course of furtherance of business or commerce”. General meaning of the word residential dwelling means “A house, apartment, or other place of residence” or “A place to live in”. Hence a commercial property used for residence becomes a residential dwelling thereby rendering it non taxable and residential dwelling used for commercial purpose such as a bank branch would be taxable.
Further exemptions
1.)renting of precincts of a religious place meant for general public is also exempt vide exemption notification.
2.) renting of vacant land, with or without a structure incidental to its use, relating to agriculture. Eg would be animal shelters.
Actually there is no activity in this but still would be taxable since it is a declared service. Copied from Australian legislature.
Agreeing – Needs to be consent of both the parties. A contract which has been thrust on one would not necessarily fit into the definition of the word “Agreeing”
Obligation - The condition of being morally or legally bound to do something.
Some e.g.
1.) car given in hire by a person with driver on a per month basis. Not right to use since license and permissions not transferred to hirer. Delhi High Court
2.) Hiring of Bank lockers. Not right to use since possession of the locker is not transferred only the contents belong to the hirer. AP High Court
3.) Pandal and Shamiana ? For me it is not transfer of right to use which has been transferred since owner has the effective control over the same
Only the activities which are in relation to delivery of goods are the ones sought to be taxed and not the delivery of goods itself.
Hire purchase has been defined in Sec 2 of the hire purchase act, 1972 as
1.) possession is transferred to the hirer on the condition that such person pays periodical installments. AND
2.) property of such goods passes to the hirer upon the payment of the last installment. AND
3.) such person has the right to terminate the agreement any time before the property so passes.
Financial, operating leases would be only covered if they suffice the above conditions.
It has been defined in 65B(44) as a contract wherein transfer of property in goods involved in the execution is leviable to tax as sale of goods. In case on a transaction sales tax is not levaible hence the same should not be within the ambit of the above definition.
The definition of works contract as proposed in the bill and the act has undergone a substantial change wherein even movable goods have been brought into the ambit of taxation. Earlier it was only limited to “to any building or structure on land”. Now the same reads as “of any movable or immovable property”
New notification 24/2012 dated 06-06-2012
“original works” mean all new constructions OR all types of additions and alterations to damaged and abandoned structures on land that required to make them workable OR erection, commissioning or installation of plant, machinery or equipment or structures, whether pre-fabricated or otherwise.
Directly in relation to means there should be a direct nexus and not a mere relation.
Immovable property has not been defined and hence according to General Clauses Act the same shall mean – Land, benefits to arise out of land, and things attached to earth, or permanently fastened to anything attached to the earth. Thus can include movable fastened machinery within its ambit.
An Indian firm provides a ‘technical inspection and certification service’ for a newly developed product of an overseas firm (say, for a newly launched motorbike which has to meet emission standards in different states or countries). Say, the testing is carried out in Maharashtra (20%), Kerala (25%), and an international location (say, Colombo 55%).
Notwithstanding the fact that the greatest proportion of service is outside the taxable territory, the place of provision will be the place in the taxable territory where the greatest proportion of service is provided, in this case Kerala.
“account” means an account bearing interest to the depositor, and includes a non-resident external account and a non-resident ordinary account; for other banking services would get covered under the main rule 3
(f) “intermediary” means a broker, an agent or any other person, by whatever name called, who arranges or facilitates a provision of service between two or more persons;
Is the place of destination of goods, except in the case of services provided by GTA for transportation of goods by road, in which case place of provision is location of the person liable to pay tax (as determined in terms of rule 2(1)(d) of Service tax Rules, 1994.
Continuous Journey means –
1.) Either a Single ticket
2.) One ticket or invoice with no scheduled stop over in the journey
London Delhi London – Not taxable since the London is place of provision of service is in London.
Place where the passenger embarks on the conveyance for a continuous journey. Continuous journey means – journey for which single ticket issued or more than one ticket or invoice has been issued for the journey, by one service provider, or by an agent on behalf, at the same time, and there is no scheduled stopover in the journey
Moscow – Delhi – Chennai – Video on demand consumed then not taxable since first scheduled departure was from Moscow
Delhi – Moscow – Paris – above taxable since first departure point from Delhi even though consumed on Moscow Paris route.