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64. Extent, commencement and application.
1) This Chapter extends to the whole of India except the State of Jammu and Kashmir.
2) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.
3) It shall apply to taxable services provided on or after the commencement of this Chapter.
23. Definitions
23A. Classification of taxable services
  1) For the purposes of this chapter classification of taxable services shall be determined according to terms of sub-clauses of clause (105) of section 23;
2) when for any reason, a taxable service is, prima facie, classifiable under two or more sub-clauses or clause (105) of section (23), classification shall be affected as follows :-
  a) the sub-clause which provides the most specific description shall be preferred to sub-clauses providing a more general description;
b) composite services consisting of a combination of different services which can not be classified in the manner specified in clause (a) shall be classified as if it consisted in the service which gives them their essential character;
c) when a service can not be classified in the manner specified in clause (a) or clause (b), it shall be classified under sub-clause which occurs first among the sub-clauses which equally merit consideration;
66. Charge of Service Tax
  There shall be levied a tax (hereinafter referred to as the service tax) at the rate of ten per cent of the value of the taxable services with in sub-clauses (a) to (z) and (za) to (zz) and clause (zza) to (zzzh)of clause (105) of section 23 and collected in such manner as may be prescribed;
67. Valuation of taxable services for charging service tax
1) Subject to the provisions of this Chapter, where service tax is chargeable on any taxable service with reference to its value, then such value shall —
  i)  in a case where the provision of service is for a consideration in money, be the gross amount charged by the service provider for such service provided or to be provided by him;
  ii) in a case where the provision of service is for a consideration not wholly or partly consisting of money, be such amount in money as, with the addition of service tax charged, is equivalent to the consideration;
  iii) in a case where the provision of service is for a consideration which is not ascertainable, be the amount as may be determined in the prescribed manner.
2) Where the gross amount charged by a service provider, for the service provided or to be provided is inclusive of service tax payable, the value of such taxable service shall be such amount as, with the addition of tax payable, is equal fo to the gross amount charged.
3) The gross amount charged for the taxable service shall include any amount received towards the taxable service before, during or after provision of such service.
4) Subject to the provisions of sub-sections (1), (2) and (3), the value shall be determined in such manner as may be prescribed.
Explanation.—For the purposes of this section,—
 
  a) "consideration" includes any amount that is payable for the taxable services provided or to be provided;
  b) "money" includes any currency, cheque, promissory note, letter of credit, draft, pay order, travellers cheque, money order, postal remittance and other similar instruments but does not include currency that is held for its numismatic value;
  c) "gross amount charged" includes payment by cheque, credit card, deduction from account and any form of payment by issue of credit notes or debit notes and book adjustment.
68. Payment of Service Tax
a) Every person providing taxable service to any person shall pay service tax at the rate specified in section 66 in such manner and within such period as may be prescribed.
b) Notwithstanding anything contained in sub-section (1), in respect of any taxable service notified by the Central Govt. in the Official Gazette, the service tax thereon shall paid by such person and in such manner as may be prescribed at the rate specified in section 66 and all the provisions of this chapter shall apply to such person as if he is the person liable for paying the service tax in relation to such service.
69. Registration
a) Every person liable to pay the service tax under this chapter or the rules made there under shall, within such time and in such manner and in such form as may be prescribed, make an application for registration to the Superintendent of Central Excise.
b)  The Central Government may, by notification in the Official Gazette, specify such other person or class of persons, who shall make an application for registration within such time and in such manner and in such form as may be prescribed;
70. Furnishing of returns
a) Every person liable to pay the service tax shall himself assess the tax due on the services provided by him and shall furnish to the Superintendent of Central Excise, a return in such form and in such manner and at such frequency as may be prescribed.
b) The person or class of persons notified under sub-section (2) of section 69, shall furnish to the Superintendent of the Central Excise, a return in such form and in such manner and at such frequency as may be prescribed;
71. Omitted
71A. Filing of returns by certain customers
  Notwithstanding anything contained in the provisions of section 69 and section 70, the provisions thereof shall not apply to a person referred to in the provisio to sub-section (1) of section 68 fir the filing of return in respect of service tax for the respective period and service specified therein and such person shall furnish return to the Central Excise Officer within six months from the day on which the Finance BIll 2003 receives the assent of President in the prescribed manner on the basis of the self assessment of the service tax and the provisions of section 71 shall apply accordingly.
. [inserted for the period 16.7.97 to 16.10.98 by Section 158 of Finance Act,2003 and shall have effect and be deemed always to have had effect from 16.7.97.]
72. Omitted*
73. Recovery of service tax not levied or paid or short levied or short paid or erroneously refunded
1) Where any service tax has not been levied or paid or has been short levied or short paid or erroneously refunded, Central Excise Officer, within one year from the relevant date, serve notice on the person chargeable with service tax which has not been levied or paid or which has been short levied or short paid or the person to whom such tax refund has been erroneously made, requiring him to show cause why he should not pay the amount specified in the notice:
Provided that where any service tax has not been levied or paid or has been short levied or short paid or erroneously refunded by reason of-
 
a) fraud; or
b) collusion; or
c) willful mis-statement; or
d) suppression of facts; or
  e) contravention of any of the provisions of this Chapter or the rules made thereunder with intent to evade payment of service tax
  by the person chargeable with the service tax or his agent, the provisions of this sub-section shall have effect, as if, for the words “one year”, the words “five years” had been substituted.
  Explanation. - Where the service of the notice is stayed by an order of a court, the period of such stay shall be excluded in computing the aforesaid period of one year or five years, as the case may be.
  1A)  Where any service tax has not been levied or paid or has been short-levied or shortpaid or erroneously refunded, by reason of fraud, collusion or any wilful misstatement or suppression of facts, or contravention of any of the provisions of this Chapter or the rules made thereunder, with intent to evade payment of service tax, by such person or his agent, to whom a notice is served under the proviso to sub-section (1) by the Central Excise Officer, such person or agent may pay service tax in full or in part as may be accepted by him, and the interest payable thereon under section 75 and penalty equal to twenty-five per cent, of the service tax specified in the notice or the service tax so accepted by such person within thirty days of the receipt of the notice.
2) The Central Excise Officer shall, after considering the representation, if any, made by the person on whom notice is served under sub-section (1), determine the amount of service tax due from such person (not being in excess of the amount specified in the notice) and thereupon such person shall pay the amount so determined.

Provided that where such person has paid the service tax in full together with interest and penalty under sub-section (1A), the proceedings in respect of such person and other persons to whom notices are served under sub-section (1) shall be deemed to be concluded:

Provided further that where such person has paid service tax in part along with interest and penalty under sub-section (1A), the Central Excise Officer shall determine the amount of service tax or interest not being in excess of the amount partly due from such person.
3) where any service tax has escaped assessment or has been under assessed or service tax has not been paid or has been short paid or erroneously refunded, the person chargeable with service tax, may pay the amount of tax, chargeable or erroneously refunded, on the basis of his own ascertainment of such tax or on the basis of tax ascertained by Central Excise officer before service of notice on him under sub-section (1) in respect of service tax, and inform the Central Excise Officer of such payment in writing, who, on receipt of such information shall not serve any notice under sub-section (1) in respect of service tax so paid;
  Provided that the Central Excise officer may determine the amount of short payment of service tax or erroneously refunded service tax, if any, which in his opinion has not been paid by such person and then, the Central Excise officer shall proceed to recover such amount in the manner specified in this section and the period of “one year” referred to sub-section (1) shall be counted from the date of receipt of such information of payment.
  Explanation  : For removal of doubts it is hereby declared that interest under section (75) shall be payable on the amount paid by the person under this sub-section and also on the amount of short payment of service tax, if any, as may be determined by the Central Excise officer, but for this sub-section;
4) Nothing contained in sub-section (3) shall apply to a case where any service tax has not been levied or paid or short levied or short paid or erroneously refunded by reason of-
a) fraud; or
b) collusion; or
d) willful mis-statement; or
e) suppression of facts; or
  f) contravention of any of the provisions of this Chapter or the rules made thereunder with intent to evade payment of service tax
5) The provisions of sub-section (3) shall not apply in any case where the service tax had become payable or ought to have been paid before the 14th day of May,2003.
6) For the purposes of this section, "relevant date" means,-
  i)     in the case of taxable service in respect of which service tax has escaped assessment or has been under-assessed or has not been paid or has been short-paid-
    a) where under the rules made under this Chapter, a periodical return, showing particulars of service tax paid during the period to which the said return relates, is to be filed by an assesses, the date on which such return is so filed;
    b) where no periodical return as aforesaid is filed, the last date on which such return is to be filed under the said rules;
    c) in any other case, the date on which the service tax is to be paid under this Chapter or the rules made thereunder;
  ii) in a case where the service tax is provisionally assessed under this Chapter or the rules made thereunder, the date of adjustment of the service tax after the final assessment thereof;
  iii) in a case where any sum, relating to service tax, has erroneously been refunded, the date of such refund.
74. Rectification of Mistake
1) With a view to rectifying any mistake apparent from the record, the Central Excise officer who passed any order under the provisions of this Chapter may, within two years of the date on which such order was passed, amend the order.
2) Where any matter has been considered and decided in any proceeding by way of appeal or revision relating to an order referred to in sub-section (1), Central Excise officer passing such order may, notwithstanding anything contained in any law for the time being in force, amend the order under that sub-section in relation to any matter other than the matter which has been so considered and decided.
3) Subject to the other provisions of this section, the Central Excise officer concerned –
a) may make an amendment under sub-section (1) of his own motion; or
  b) shall make such amendment if any mistake is brought to his notice by the assessee or the Commissioner of Central Excise or the Commissioner of Central Excise (Appeals).
4) An amendment, which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee, shall not be made under this section unless the Central Excise officer concerned has given notice to the assessee of his intention so to do and has allowed the assessee a reasonable opportunity of being heard.
5) Where an amendment is made under this section, an order shall be passed in writing by the Central Excise officer concerned.
 
6) Subject to the other provisions of this Chapter where any such amendment has the effect of reducing the liability of an assessee or increasing the refund, the Assistant Commissioner of Central Excise or, as the case may be, Deputy Commissioner of Central Excise shall make any refund which may be due to such assessee.
7) Where any such amendment has the effect of enhancing the liability of an assessee or reducing the refund already made, the Central Excise officer shall make an order specifying the sum payable by the assessee and the provisions of this Chapter shall apply accordingly.
75. Interest on delayed payment of Service Tax
  Every person, liable to pay the tax in accordance with the provisions of section 68 or rules made thereunder, who fails to credit the tax or any part thereof to the account of the Central Government within the period prescribed, shall pay simple interest at such rate of not below ten per cent and not exceeding thirty six per cent per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette for the period by which such crediting of the tax or any part thereof is delayed.
75A. Omitted**
76. Penalty for failure to pay service tax
  – Any person, liable to pay service tax in accordance with the provisions of section 68 or the rules made under this Chapter, who fails to pay such tax, shall pay, in addition to such tax and the interest on that tax in accordance with the provisions of section 75, a penalty which shall not be less than two hundred rupees for every day during which such failure continues or at the rate of two per cent, of such tax, per month, whichever is higher, starting with the first day after the due date till the date of actual payment of the outstanding amount of service tax:
Provided that the total amount of the penalty payable in terms of this section shall not exceed the service tax payable.
Illustration
X, an assessee, fails to pay service tax of Rs. 10 lakhs payable by 5th March. X pays the amount on 15th March. The default has continued for 10 days. The penalty payable by X is computed as follows:—
2% of the amount of default for 10 days = 2 x 10,00,000 x 10/31 = Rs. 6,451.61
Penalty calculated @ Rs. 200 per day for 10 days = Rs. 2,000
Penalty liable to be paid is Rs. 6,452.00.
 
77. Penalty for contravention of any provision for which no penalty is provided
 

Whoever contravenes any of the provisions of this Chapter or nay rule made thereunder for which no penalty is separately provided in this Chapter, shall be liable to a penalty which may extend to an amount not exceeding one thousand rupees.                                                                                              <<Back

 

 

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