Service Tax extends to the Continental Shelf & Exclusive Economic
Zone (CS & EEZ) of India [Notification No. 14/2010-S.T., dated 27-2-2010]
Eg: A Vessel sailing from Karachi to Colombo
developed some technical snag while passing through CSI (Continental Shelf of
India) off Kochi port. A marine engineer from Ernakulam provides service to the
vessel anchored in the EEZI (Exclusive Economic Zone of India).
Sol:No tax ! Why? Because, the vessel located in
the CSI / EEZI, is not engaged in the mineral exploitation.
Eg #2:Installation in EEZI meant for prospecting for
mineral oil, did not find out oil. Is tax payable on service provided to such
Sol:Tax is payable ! Why? Because, installation
was for the purposes of prospecting mineral oil. It does not matter whether oil
was found or not.
No of days of forced
stay in India cannotbe counted while determining the Residential
where the Government Agencies illegally impounded the passport of the assessee
and because of which his stay in India exceeded 182 days, he cannot be treated
as ‘Resident’. i.e The number of days for which his passport was impounded is
to be excluded while counting the period of STAY.
[Suresh Nanda Vs ACIT]  [45 Taxmann.com 269] [Delhi – Tribunal]
Update in Indirect Tax Laws # 7: Service Tax Paid towards expenses on after sales service is
eligible for credit as input service as the same is covered in the definition
of input service as defined in Rule 2(l) of the CENVAT Credit Rules, 2004. [Com Vs Mahindra & Mahindra Ltd] [34 STR J 217] [RK
Jain]  [Mumbai-HC]
Update in Indirect Tax
Laws # 6: CENVAT
Credit on Sales Commission Service is not available.
where the assessee incurred expenditure towards ‘Sales Commission Service’,
held that CENVAT Credit on the same is not available to the assessee. [Astik Dyestuff Pvt Ltd Vs CCEX]  [34
STR 814] [Gujarat HC]; In this Judgment they affirmed the judgment given in
earlier case of ‘CCEX Vs Cadila Healthcare Ltd]  [30 STR 3] [Gujarat HC].
Readers may note that a contrary
judgment was given by the P&H HC in ‘CCEX Vs Ambica Overseas’  [25
Yuvraj Singh gets
service tax notice: The Central Excise Department had
issued a show cause notice to cricketer Yuvraj Singh, seeking payment of
service tax to the tune of Rs 46.60 lakhs on his income from promotional
activity. The tax demand was raised on the payment of Rs 4.14 Crores which
Yuvraj Singh received from Sahara Adventure Sports for carrying out promotional
activity, as clarified by the Central Excise Officials. However, he had already
paid Rs 36 lakhs as service tax and the balance is to be paid as per the terms
of the said notice. [Source: Page J181
Volume 34: Part 5 of STR – RK Jain] [Next Batch for CA Final IDT - Nov 2014 attempt starts on 11th Aug 2014]
a composite contract for ‘Manufacture,
Supply and Installation of Lifts in a Building’ amounts to ‘Contract of
Sale’ or ‘Works Contract’? It
was held that it amounts to ‘Contract of
Sale’ and not a ‘Works Contract’ as skill and labour employed for
converting main components into end product was only incidental. Thus, the
decision of the Supreme Court in ‘State of AP Vs Kone Elevators’  [181
ELT 156] was overruled by the 5 member bench of the Supreme Court in ‘Kone Elevator India Pvt Ltd Vs State of
Tamilnadu’  [34 STR 641] [SC].