study circle reference material-ca payal (prerana) shah-10 02 2015
TRANSCRIPT
Notifications & Circulars issued during Financial Year 2014-2015
under Service tax Laws
on 10 th February, 2015
Chairman: Ca Naresh Sheth
Group leader: Ca Payal (Prerana) Shah
Compilation prepared by: Ca Payal (Prerana) Shah
Preamble:
The presentation covers notification/circulars/instructions issued from April, 2014 to January, 2015.
The presentation does not cover administrative notifications /circulars. The presentation does not cover notification/circulars relating to Finance Bill/Act,
2014. The presentation provides understanding of the compiler on Notifications, Orders,
Circulars or Instructions as on the date. The complier has restricted herself to Service tax Laws only. Therefore, in cases
where Notifications, Orders, Circulars or Instructions covered more than one law, the provisions relevant to Service tax Laws are only discussed.
I. TAXABILITY
1.1. Joint Venture viz-a-viz Service tax
Earlier, Circular No. 148/17/2011-ST dated 13th December, 2011 and Circular No.
151/12/2012-ST dated 10th February, 2012 discussed Service tax implications in case of Joint
Venture (JV) and it was clarified that only in case of revenue sharing on principal-to-principal
basis, Service tax is not attracted. Further, as per Explanation 3 (a) to Section 65B (44) of the
Finance Act, 1994, an unincorporated association or BOP and its members shall be treated
as distinct persons. Consequently, taxable services provided for consideration, by the JV to
its members or vice versa and between the members of the JV, are leviable to Service tax.
Now, recently, Circular is issued to further clarify Service tax implications in case of Joint
Venture as under:
Recent Notifications and Circulars issued in Financial Year 2014-2015 under Service tax Laws
Cash calls, being capital contributions, made by members of JV to JV shall be critically
examined. If cash calls are merely a transaction in money, no Service tax shall be
levied vide Section 65B (44) of the Finance Act, 1994. Whether a cash call is merely a
transaction in money or is a consideration, would depend on the terms of Joint
Venture Agreement.
Detailed and closed scrutiny of the terms of JV Agreement needs to be carried out in
each case, to determine leviability of Service tax on cash calls. Following examples
are provided by CBEC:
o Taxable service provided by JV to its members:
Sometimes Cash calls could be in the nature of advance payments
made by members towards taxable services to be received from JV.
For instance, JV receiving the cash call may, in return, agree to do
something of direct benefit either to the member or on the behest of
a member to a third party, such as granting of right, reserving
production capacity or providing an option on future supplies.
Taxable services received by a JV from its members or third party:
If JV is making payments out of pooled cash calls to a member or a
third party towards taxable services, the same would take colour of
“consideration” and therefore, Service tax would be applicable.
o Taxable services provided by members to JV:
Customarily, responsibility of managing the cash calls of JV is assigned
to member/s by way of a contractual agreement. In such a case, if the
member/s receives a consideration for the same either in cash or
kind, it is a taxable service.
A member of JV may provide support services such as administrative
service in the form of setting up/management of a project office/site
office to the JV for a consideration either in cash or kind.
(Circular No. 179/5/2014-ST dated 24th September, 2014)
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1.2. Change in rate of exchange for Service tax Laws with effect from 1st October, 2014
Hitherto, for determining value of taxable services, rate of exchange as prevailing under
Customs Laws was to be considered vide Section 67A of the Finance Act, 1994. Vide Union
Budget 2014-2015, the rate of exchange has to be adopted as per prescribed rules. The said
amendment is effective from 1st October, 2014 and as per the said amendment, Rule 11 has
been introduced under Service tax Rules, 1994 with effect from 1st October, 2014 which
reads as under:
“11. Determination of rate of exchange. - The rate of exchange for determination of value
of taxable service shall be the applicable rate of exchange as per the generally accepted
accounting principles on the date when point of taxation arises in terms of the Point of
Taxation Rules, 2011.”
Further, CBEC or the Chief Commissioners of Central Excise are now empowered to issue
instructions for any incidental or supplemental matters for the implementation of the
provisions of the Finance Act, 1994.
(Notification No. 19/2014-ST dated 25th August, 2014)
1.3. Levy of Service tax on activities involved in relation to inward remittances from
abroad to beneficiaries in India through MTSOs
Circular No. 163/14/2012–ST dated 10th July, 2012 clarified that in case of inward
remittances, no Service tax is leviable on inward remittances since the transaction is in
money, specifically excluded from the definition of service. Further, Service tax is not
leviable on conversion charges post negative list of services regime since person sending
money and Company conducting remittances are located outside India. Further, in such a
case, Indian bank or financial institution provide services to the foreign bank or any other
entity. Since such services are provided on principal to principal basis, the place of provision
of such services is location of service recipient i.e. outside Indian territory, not leviable to
Service tax vide Rule 3 of Place of Provision of Services Rules, 2012 (PPSR).
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Recent Notifications and Circulars issued in Financial Year 2014-2015 under Service tax Laws
However, CBEC has subsequently noticed that Foreign Money Transfer Service Operator
(MTSO), providing services to a beneficiary in India, appoints Indian bank/s/financial
institution/s as their agents in India who are given commission/fees for such
agency/representational services. These Indian bank/s/financial institution/s also appoints
sub-agents sometimes to provide services to MTSO. Further, Indian bank/s/financial
institution/s or sub-agents may also charge fees from Indian beneficiary. The issue under
consideration is, whether these Indian bank/s/financial institution/s are covered within the
definition of ‘intermediary’ covered under Rule 9 of PPSR.
Accordingly, in light of these new facts, the said Circular is rescinded and following
clarifications are issued:
Issues Clarification
Whether service tax is payable on remittance
received in India from abroad?
No service tax is payable per se on the
amount of foreign currency remitted to
India from overseas. As the remittance
comprises money, it does not in itself
constitute any service in terms of the
definition of ‘service’ vide Section 65B (44)
of the Finance Act, 1994.
Whether the service of an agent or the
representation service provided by an Indian
entity/bank to MTSO in relation to money
transfer falls within the category of
intermediary service?
Yes. The Indian bank or other entity acting
as an agent to MTSO in relation to
money transfer facilitates in delivery of
remittance to the beneficiary in India i.e.
these Indian entities/bank/s facilitate the
provision of Money transfer Service by
MTSO to a beneficiary in India which is
covered within the definition of
intermediary as defined in Rule 2 (f) of
PPSR.
Whether Service tax is leviable on the service
provided by an intermediary/agent located in
Vide Rule 9 (c) of PPSR, in the present
case, the place of provision of service is
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Recent Notifications and Circulars issued in Financial Year 2014-2015 under Service tax Laws
India to MTSOs located outside India? the location of service provider i.e. India
and accordingly, Service tax is payable on
commission or fees charged by such
agent/s.
Whether Service tax would apply on the
amount charged separately, if any, by the
Indian bank/entity/agent/sub-agent from the
person who receives remittance in the
taxable territory, for the service provided by
such Indian bank/entity/agent/sub-agent?
Yes. As the service is provided by Indian
bank/entity/agent/sub-agent to a person
located in taxable territory, the place of
provision of such services is in the taxable
territory. Accordingly, Service tax is
payable on such amount charged
separately, if any.
Whether Service tax would apply on the
services provided by way of currency
conversion by a bank /entity located in India
to the recipient of remittance in India?
Any activity of money changing comprises
an independent taxable activity.
Therefore, Service tax applies on currency
conversion in such cases in terms of the
Service Tax (Determination of Value)
Rules. Service provider has an option to
pay Service tax at prescribed rates in
terms of Rule 6 (7B) of the Service Tax
Rules, 1994.
Whether services provided by sub-agents to
such Indian Bank/entity located in the taxable
territory in relation to money transfer is
leviable to service tax?
Sub-agents also fall in the category of
intermediary. Therefore, Service tax is
payable on commission received by sub-
agents from Indian bank/entity.
(Circular No. 180/06/2014–ST dated 14th October, 2014)
II. EXEMPTION
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Recent Notifications and Circulars issued in Financial Year 2014-2015 under Service tax Laws
1.4. Exemption to specified organizations for services in respect of specified religious
Pilgrimages
Vide Mega Exemption Notification; Notification No. 25/2012-ST dated 20th June, 2012,
various exemptions are provided to specified services. The exemption is based on nature of
services, its usage, type of service receiver etc. Now, a new exemption is inserted with
respect to religious pilgrimage with effect from 20th August, 2014. Accordingly, services
provided by Kumaon Mandal Vikas Nigam Limited, a Government of Uttarakhand
Undertaking and “Committee” or “State Committee” defined under Section 2 of the Haj
Committee Act, 2002, in respect of a religious pilgrimage facilitated by the Ministry of
External Affairs of the Government of India, under bilateral arrangement, are granted full
exemption from Service tax levy.
(Notification No. 17/2014-ST dated 20th August, 2014)
III. CENVAT CREDIT
1.5. Availment of Cenvat Credit after 6 months with respect of re-credited Cenvat Credit
In following circumstances the assessee avails Cenvat Credit, reverses the same and takes
re-credit of Cenvat Credit:
In case of prospective charge and partial reverse charge mechanism, if the value of
input service and Service tax payable, is not paid within 3 months from the date of
invoice, bill or challan, Cenvat Credit availed needs to be reversed. Subsequently, on
payment of value of input service and Service tax, Cenvat Credit reversed is available
in the form of re-credited (3rd proviso to Rule 4(7) of Cenvat Credit Rules, 2004 (CCR,
2004)).
If the value of inputs is written off or a provision is made in books of accounts to
write off the value, fully or partially, the service provider has to reverse Cenvat Credit
availed. However, if the inputs are subsequently used for provision of output
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Recent Notifications and Circulars issued in Financial Year 2014-2015 under Service tax Laws
services, re-credit of reversed Cenvat Credit is available (Proviso to Section 3(5B) of
CCR, 2004).
If inputs, as such or after being partially processed, are sent to a job worker for
further processing, testing, repair, re-conditioning or any other purpose and the
same are not received back within 180 days from the date of sending the inputs to
the job worker, Cenvat Credit needs to be reversed. Once inputs are received back in
the premises of output service provider, re-credit of Cenvat Credit is available (Rule
4(5)(a) of CCR, 2004).
Through Union Budget 2014-2015, time limit is introduced for availment of Cenvat Credit.
With effect from 1st September, 2014, the output service provider shall take Cenvat Credit
on inputs and input services within 6 months from the date of issue of documents specified
in Rule 9 (1) of CCR, 2004 vide Rule 4 (1) and Rule 4 (7) of CCR, 2004. There was a concern
whether in cases of re-credits enumerated above, whether the time limit of 6 months would
apply or not. If the time limit would apply, whether it would apply from the date of actual
credit or re-credit.
Now, the Board has clarified that the purpose of amendment was to inculcate discipline
amongst the assessees while taking Cenvat Credit. Therefore, limitation of 6 months would
apply only when Cenvat Credit is taken for the first time and it would not apply on cases
of re-credit of Cenvat credit reversed earlier provided the conditions prescribed in the said
rules are fulfilled.
(Circular No. 990/14/2014-CX-8 dated 19th November, 2014)
1.6. Chief Commissioner may pass order to impose restrictions to prevent misuse of
provisions of Cenvat Credit even for output service providers
Vide Rule 12AAA of CCR, 2004 if Central Government is of the opinion that to prevent
misuse of provisions of Cenvat Credit, certain measures including restrictions needs to be
taken, it may issue a notification specifying nature of restrictions, suspension of registration,
types of facilities to be withdrawn and procedure for issue of order by authorized Officers.
Now, the said Rule is amended as under:
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“12AAA. Power to impose restrictions in certain types of cases. — Notwithstanding anything
contained in these rules, where the Central Government, having regard to the extent of
misuse of CENVAT credit, nature and type of such misuse and such other factors as may be
relevant, is of the opinion that in order to prevent the misuse of the provisions of CENVAT
credit as specified in these rules, it is necessary in the public interest to provide for certain
measures including restrictions on a manufacturer, first stage and second stage dealer,
provider of taxable service 1 or an exporter, may by a notification in the Official Gazette,
specify the nature of restrictions including restrictions on utilization of CENVAT credit and
suspension of registration in case of a dealer and type of facilities to be withdrawn and
procedure for issue of such order by an officer authorized by the Board the Chief
Commissioner of Central Excise.
Explanation. - For the purposes of this rule, it is hereby clarified that every proposal
initiated in terms of the procedure specified under notification no. 5/2012-C.E. (N.T.) dated
the 12 th March, 2012 published in the Gazette of India, Part II, Section 3, Sub-section (i)
vide number G.S.R. 140(E), dated the 12th March, 2012, which is pending, shall be treated
as initiated in terms of the procedure specified under this rule and shall be decided
accordingly. 2 ”
Accordingly, now, Rule 12AAA is applicable to output service provider and the order for such
restrictions has to be passed by the Chief Commissioner of Central Excise as against
authorized Officer. Further, by way of insertion of explanation, it is clarified that pending
proposals under Notification No. 5/2012-CE (NT) dated 12th March, 2012 shall be treated as
initiated in terms of procedures specified in Rule 12AAA of CCR, 2004 and shall be decided
accordingly.
(Notification No. 15/2014-CE (NT) dated 21st March, 2014 and Notification No. 25/2014-CE (NT) dated 25th August, 2014)
1.7. Service tax Certificate issued by Indian Railways to be eligible document for
availment of Cenvat Credit
1 Inserted with effect from 25th August, 2014
2 Deleted and inserted with effect from 21st March, 2014
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Recent Notifications and Circulars issued in Financial Year 2014-2015 under Service tax Laws
Rule 9 (1) of Cenvat Credit Rules, 2004 provides for eligible documents to avail Cenvat
Credit. Now, Service Tax Certificate issued by the Indian Railways for transportation of
goods by Rail (STTG Certificate) along with photocopies of railway receipts mentioned in
such STTG certificate is also specified as eligible document for availment of Cenvat Credit.
(Notification No. 26/2014-CE (NT) dated 27th August, 2014)
1.8. Cenvat Credit on Tower Parts & Pre-fabricated Buildings used by Cellular Mobile
Service Providers
CBEC drawn attention for compliance to the decision delivered by Bombay High Court in the
case of M/s. Bharti Airtel Ltd. v. CCE, Pune-III (2014 (35) S.T.R. 865 (Bom.)). Relying on the
decision of Hon’ble Supreme Court in the case of Saraswati Sugar Mills v. CCE Delhi, (2011
(270) ELT 465), the Hon’ble Bombay High Court observed that the subject items were
neither capital goods under Rule 2 (a) nor inputs under Rule 2(k) of CCR, 2004 and
therefore, it was held that Cenvat credit on Tower Parts & Pre-fabricated buildings was not
available to Cellular Mobile Service Provider.
(Instruction No. 267/60/2014-CX dated 11th November, 2014)
IV. PROCEDURAL
1.9. Clarification on amendment in appeal provisions in Customs, Central Excise and
Service tax
Vide Finance Act, 2014, pre-deposit was made mandatory in case of filing appeals at first
and second appellate level. Since there were confusions with respect to the said
amendment, department has issued one circular clarifying following aspects:
Quantum of pre-deposits for appeals made against order of Commissioner (Appeals):
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o It has been clarified that 10% of duty or penalty imposed by the
Commissioner (Appeals) would be the quantum of pre-deposit which may
differ from duty demanded or penalty imposed in Order-in-Original.
o In cases where appeals are filed against penalty alone, pre-deposit would be
calculated based on aggregate of all penalties imposed in the order against
which appeal is proposed to be filed.
o In case of failure to pay requisite pre-deposits, appeal is liable for rejection.
Payment during investigation:
o Out of the total amount paid during the course of investigation or audit, prior
to the date of filling appeal, amounts paid to the extent of 7.5% or 10%,
subject to the ceiling limit of Rs 10 crores, may be considered to be pre-
deposit. Additional amounts paid, if any, will not be considered as pre-
deposit.
o Payments made in the course of investigation or audit will take colour of pre-
deposit only when appeal is filed and therefore, the date of filling appeal shall
be deemed to be the date of deposit made.
o In case of failure to pay requisite pre-deposits, appeal is liable for rejection.
Recovery of amounts during pendency of appeal:
o Circular No. 967/1/2013 issued by the department on 1st January, 2013
regarding recovery of amounts due to the Government, will not apply to the
appeals filed after amendment of the provisions relating to pre-deposit.
o No coercive measures shall be taken by the departmental authorities for
recovery of balance amount over and above pre-deposit during pendency of
appeal provided the assessee produces proof of payment of pre-deposit and
copy of appeal memo filed.
o Recovery action can be initiated only when the decision is in the favour of the
department and higher judicial forum has not granted stay. Recovery would
include interest amount as well from the date duty became payable till the
date of payment.
Refund of pre-deposit:
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o If the appeal is decided in favour of assessee, pre-deposit needs to be
refunded. Refund, not being of duty but of pre-deposit which is not payment
of duty, is not governed by Section 11B of Central Excise Act, 1944.
Accordingly, refund along with interest shall be paid to the appellant within
15 days of receipt of letter of appellant seeking refund irrespective of
whether the department is proposing to challenge the order of appellate
authority.
o If department contemplates appeal against appellate authority’s order,
refund with interest is payable unless stayed by appellate authority.
o In the event of remand, refund shall be payable along with interest.
o In cases where demand is confirmed partially, pre-deposit amount to be
adjusted with the duty confirmed along with interest.
Procedure and manner of making pre-deposit:
o E-payment facility may be used by appellants.
o Self-attested copy of proof of payment of pre-deposit to be submitted before
the appellate authority and the information of payment has to be provided in
respective forms of appeals which shall be verified before registering the
appeal.
o Copy of appeal memo with proof of payment of pre-deposit shall be filed
with jurisdictional officers.
Procedure for refund:
o A simple letter, from appellant requesting for return of such amount with
self-attested copies of order-in-appeal or CESTAT Order and proof of
payment of pre-deposit, to be filed with jurisdictional Assistant
Commissioner/Deputy Commissioner for claiming refund with interest.
o Record of pre-deposits made to be maintained by Commissionerate to
facilitate seamless verification of pre-deposits at the time of processing
refund claims.
Amendment to Preamble of Orders:
o Consequent to amendment in provisions of pre-deposits, pre-amble of the
orders to be amended.
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(Circular No. 984/08/2014-CX dated 16th September, 2014)
1.10. Mandatory Pre-deposit
Vide above Circular, the Commissionerates are required to maintain a database of pre-
deposits to facilitate seamless verification of pre-deposits at the time of processing refund claims.
Accordingly, following columns are suggested to be maintained in a register (e-register preferably)
in Review Cell of each Commissionerate separately for Appeals before Commissioner (Appeals) and
CESTAT:
Sr. No.
Name of the Appellant
Details of duty paying document viz Challan etc.
Amount of pre-deposit paid
Order No. & Date of Commissioner (Appeals) Order/Tribunal.
Further, a copy of the appeal memo should be sent immediately to the Commissionerate by
the Tribunal registry where appeal memo is received vide Rule 17 of the CESTAT (Procedure)
Rules, 1982. In case of appeal before Commissioner (Appeals), appeal memo should be sent
to the Commissionerate concerned by the office of the Commissioner (Appeals).
(Circular No. 993/17/2014-CX dated 5th January, 2015)
1.11. Issue of Summons under Service tax Laws
It was noticed by CBEC that summons under Section 14 of the Central Excise Act, 1944 are
issued to top senior officials of assessees in a routine manner to call for material evidence/
documents or enforce recovery of disputed dues. Referring to its earlier Circular No.
137/39/2007-CX.4 dated 26th February, 2007, CBEC issued following guidelines:
Purpose of Summons
Summons can be used in an inquiry for recording statements or for collecting
evidence/ documents only vide Section 14 of the Central Excise Act, 944. Further, it
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has been emphasized that the summons should be issued only as a last resort when
it is absolutely required.
Prior permission for Summons issued by Superintendents
Superintendents should issue Summons after obtaining prior written permission
from an officer not below the rank of Assistant Commissioner with the reasons for
issuance of summons to be recorded in writing. In case of failure to do so for
operational reasons, oral/telephonic permission from such officer must be obtained
and the same should be reduced to writing and intimated to the concerned officer at
the earliest.
Submission of Report
In all cases, where summons are issued, the officer issuing summons should submit a
report or should record a brief of the proceedings in the case file and submit the
same to the officer who had authorised the issue of summons.
Importance of Summons
Senior management officials such as CEO, CFO, General Managers of a large
company or a PSU should not, generally, be issued summons at the first instance.
They should be summoned only when there are indications in the investigation of
their involvement in the decision making process which led to loss of revenue.
(Circular No. 207/07/2014-CX-6 dated 20th January, 2015)
1.12. Adjudication Proceedings – Judicial Discipline
Gujarat High Court in case of E.I. Dupont India Pvt. Ltd. 2014 (305) E.L.T. 282 (Guj.) has
observed that in spite of binding precedent judgment, the same was not followed. Further,
there was Circular No. 695/11/2003-CX., dated 24th February, 2003 on the subject of
consequential refund, binding department which also could have avoided unnecessary
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litigation. Accordingly, this circular is once again brought to the notice of field officers with
direction that it should be followed scrupulously.
CBEC stated that Hon’ble Supreme Court’s decision in case of Union of India v. Kamlakshi
Finance Corporation Ltd. 1991 (55) E.L.T. 433 (S.C.) may also be perused since that was an
authoritative pronouncement on the issue and was also cited by the Hon’ble High Court.
(Instruction No. 201/01/2014-CX dated 26th June, 2014)
1.13. Audits by Central Excise Officers
Hon’ble Delhi High Court in the case of M/s Travelite (India) [2014-TIOL-1304-HC-DEL-ST]
had quashed Rule 5A (2) of the Service Tax Rules, 1994 on the ground that the powers, to
conduct audit envisaged in the rule, did not have appropriate statutory backing.
It may be noted that under Central Excise Laws, there is adequate statutory backing for
conducting audit by Central Excise Officers vide Section 37 (2) (x) and Section 37 (1) of the
Central Excise Act, 1944 and Rule 22 of the Central Excise Rules, 2002. However, there was
no such provisions under Service tax Laws. Therefore, Central Government has amended
Rule 5A (2) of Service Tax Rules, 1994 with effect from 5th December, 2014 as under:
“Rule 5A. Access to a registered premises. — …
(2) Every assessee shall, on demand, make available to the officer authorised empowered
under sub-rule (1) or the audit party deputed by the Commissioner or the Comptroller and
Auditor General of India, or a cost accountant or chartered accountant nominated under
section 72A of the Finance Act, 1994, - within a reasonable time not exceeding fifteen
working days from the day when such demand is made, or such further period as may be
allowed by such officer or the audit party, as the case may be, -
(i) the records as mentioned in maintained or prepared by him in terms of sub-rule (2)
of rule 5;
(ii) trial balance or its equivalent the cost audit reports, if any, under section 148 of the
Companies Act, 2013 (18 of 2013); and
(iii) the income-tax audit report, if any, under section 44AB of the Income-tax Act, 1961
(43 of 1961), for the scrutiny of the officer or audit party, or the cost accountant or
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chartered accountant, within the time limit specified by the said officer or the audit party
or the cost accountant or chartered accountant, as the case may be.”.
On analysing the above Rules, it is observed that following amendment have been made:
Till now, the assessee was supposed to provide requisite documentation to Service
tax Officers, audit party and Comptroller and Auditor General of India. Now, such
documentation needs to be provided to cost accountant or chartered accountant
nominated under Section 72A of the Finance Act, 1994 as well.
Trial balance was included in the list of documents to be made available by the
assessee, which is now replaced by Cost Audit Report.
The time limit to submit the documents was 15 working days and the same could be
extended by Service tax Officers. Now, the time limit would be specified by such
Service tax officer or cost accountant or chartered accountant.
Further, CBEC has clarified that vide Section 94 (2) (k) incorporated with effect from 6 th
August, 2014, amendment made to Rule 5A (2) of Service tax Rules, 1994 is having a
statutory legal backing and the decision delivered in Travelite (India) (Supra), can be
distinguished. It was further clarified that the word “verified” used in the said Section is of
wide import and would include, within its scope, audit by departmental officers. Therefore,
CBEC directed Departmental Officers to carry out audits of Service tax assessees.
(Notification No. 23/2014-ST dated 5th December, 2014 read with Circular No. 181/7/2014-ST dated 10th December, 2014)
1.14. Interest on Pre-deposit
Section 35FF of the Central Excise Act, 1994 provides for interest on delayed refunds. Till
now, interest on pre-deposits was required to be paid @ 6% (Vide Section 11B of the Central
Excise Act, 1944) after expiry of 3 months from the date of communication of order till the
date of refund. Now, interest would be payable, at a notified rate which may range between
5% to 36%, for the period from the date of payment of pre-deposit till the date of refund.
Rate of interest is notified to be 6% vide Section 35FF of the Central Excise Act, 1944 read
with Notification No. 24/2014-CE (NT) dated 12th August, 2014.
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The pre-deposits made prior to 6th August, 2014 under Section 35F of the Central Excise Act,
1944 would continue to be governed by the earlier provisions of Section 35FF of the Central
Excise Act, 1944.
(Notification No. 24/2014-CE (NT) dated 12th August, 2014 read with Section 106 of the
Finance Act, 2014)
1.15. Action Plan to evolve non-adversarial indirect tax administration
In view of attaining one of the key objectives of the Department; viz; to foster non-
adversarial tax administration, initiatives have been taken to simplify procedures to reduce
interface between the tax officials and the taxpayers as under:
Punctuality
Officers are advised to maintain the appointed time as indicated in the
communications regarding personal hearing/trade meetings etc. with the taxpayers.
Further, there should be adequate gap between two meetings to avoid undue delay
in the subsequent meeting.
Prompt acknowledgement of all letters/complaints/references
All references/communications received from the trade should be quickly
acknowledged and a centralised computerized system for receipt/dispatch of dak
may be developed to monitor the status.
Priority processing of representations/communications received from taxpayers
CBEC has a mission to administer indirect taxes collection by creating a positive
environment for voluntary compliance and by providing suitable guidance to
taxpayers. Therefore, all communications received from the trade seeking
clarifications should be attended instantly.
Regular interaction with the trade
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As per Board’s instructions, various meetings of Regional Advisory Committee/Public
Grievance Committee/Permanent Trade Facilitation Committee/Open House etc.,
chaired by the Chief Commissioner/Commissioner, are to be held by the concerned
Zones/Commissionerates on a regular basis. The departmental officers should
encourage assessees to participate in these meetings for tangible outcomes.
Sevottam compliant formations may ensure strict adherence to the timeframes indicated in
the standards of service delivery. The other field formations which are in the process of
certification are advised to implement the standards immediately without awaiting BIS
certification.
Further, the Board is in the process of undertaking following measures:
Simplifying Registration process to eliminate the need for assessee’s physical visit to
Department
Facilitating online Refund/Rebate credits
Easing of Compliance verification norms.
(Instruction No. 296/165/2014-CX dated 30th September, 2014)
1.16. Initiatives towards good governance
In order to achieve excellence in the formulation and implementation of Customs, Central
Excise and Service Tax policies and enforcement of cross border controls for the benefit of
trade, industry and other stakeholders. It is reiterated that the indirect tax administration
considers all taxpayers, the cornerstone of economic independence and prosperity. In order
to further simplify and modernize the tax system, expand the tax base and improve
compliance in tandem with the Central Government's objective to ensure good governance,
it has been decided that every Wednesday from 9 AM to 1 PM would be “Taxpayers' day”
wherein Heads of all offices will meet the taxpayers without any prior appointment to
address their grievances expeditiously.
(Instruction No. 296/267/2014-CX dated 7th January, 2015)
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Recent Notifications and Circulars issued in Financial Year 2014-2015 under Service tax Laws
1.17. Guidelines regarding structure, administrative set up and functions of audit
Commissionerates
On implementation of cadre review there would be 23 Central Excise Zones and 4 Service
Tax Zones with each zone having one or more Audit Commissionerates. Each Audit
Commissionerate would cover assessees registered under the jurisdiction of 3 to 5 Executive
Commissionerates. Principal Chief Commissioner and Chief Commissioner shall assign the
jurisdiction of Audit Commissioner in the Zone, decide the location of Audit
Commissionerates and its subordinate offices. Accordingly, certain guidelines are issued
which needs to be followed while finalizing the location and organizational structure of
Audit Commissionerate and its subordinate offices. The broad areas covered under the said
guidelines are:
Location of Audit Commissionerates
Configuration of Audit Commissionerates
Organisation structure of Audit Commissionerates
Staffing norms
Functions of Audit Commissionerates
Transfer policy and capacity building etc.
Accordingly, past guidelines and instructions on the subject stands modified to the extent
they are in conflict with these guidelines. Principal Chief Commissioners and Chief
Commissioners are authorised to issue appropriate temporary instructions to remove
difficulty in setting up and operationalizing Audit Commissionerates, if there is any difficulty
in implementing these guidelines. Issues to be addressed in the Board may be forwarded to
the Director General of Audit with suggestions.
(Circular No. 985/09/2014-CX dated 22nd September, 2014)
1.18. Extension of due date for filing Service tax Return of April, 2014 to September, 2014
10.02.2015 Page 18 of 19
Recent Notifications and Circulars issued in Financial Year 2014-2015 under Service tax Laws
Having regard to the natural calamities in certain parts of the County, the due date for filing
Service tax return for the period from 1st April, 2014 to 30th September, 2014 has been
extended from 25th October, 2014 to 14th November, 2014.
(Order No. 2/2014-ST dated 24th October, 2014)
10.02.2015 Page 19 of 19