Incisive analysis of mega exemption entries - Part II

Incisive Analysis of Exemptions under Service Tax—Part II
CA Manindar
by

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Entry 5A— Services related to religious pilgrimage
Entry 6— Legal Services
Entry 7— Technical Testing and Analysis Services
Entry 8— Recreational Activities
Entry 9— Auxiliary Educational Services
Entry 9A— Skill Development Programs
Entry 10— Services Provided to Recognised Sports Body
Coverage

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 Entry 5A: Services by a specified organisation in respect of a religious pilgrimage
facilitated by the Ministry of External Affairs of the Government of India, under
bilateral arrangement
 Came into effect from 20th Aug, 2014
 Specified Organisation
 Kumaon Mandal Vikas Nigam Limited
 Committe or State Committe under Haj Committee Act, 2002
Services Related to Religious Pilgrimage

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 Services provided by-
 an arbitral tribunal to –
 any person other than a business entity; or
 a business entity with a turnover up to rupees ten lakh in the preceding financial year;
 an individual as an advocate or a partnership firm of advocates by way of
legal services to,-
 an advocate or partnership firm of advocates providing legal services;
 any person other than a business entity; or
 a business entity with a turnover up to rupees ten lakh in the preceding financial year
Legal Services

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 Article 39A— Equal Justice & Free Legal Aid:
“The State shall secure that the operation of the legal system promotes justice, on a basis
of equal opportunity, and shall, in particular, provide free legal aid, by suitable legislation
or schemes or in any other way, to ensure that opportunities for securing justice are not
denied to any citizen by reason of economic or other disabilities”
 Levy upheld in PC Joshi vs. UOI, 014-TIOL-2279-HC-MUM-ST
 Services of arbitral tribunal are akin to services of Court or tribunal established under
any law for the time being in force.
 Previously, Notification 45/2011-ST exempted arbitral services
 Levy upheld by Mumbai High Court (Supra)
Legal Services

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 Entry 7: Services by way of technical testing or analysis of newly developed drugs,
including vaccines and herbal remedies, on human participants by a clinical
research organisation approved to conduct clinical trials by the Drug Controller
General of India
 Omitted with effect from 11.07.2014
 Prior to 01.07.2012— testing or analysis in relation to human beings or animals are
not taxable.
 Ray of hope for exporters with CCE vs. Sai Life Sciences Ltd, 2016-TIOL-433-CESTAT-Mum
Technical testing or analysis services

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 Entry 8: Services by way of training or coaching in recreational activities relating to arts,
culture or sports.
 Prior to 01.07.2012 all training or coaching activities in sports are not taxable.
 Recreational training vis-à-vis professional training .
Recreational Activities

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 Services provided to or by an educational institution in respect of education
exempted from service tax, by way of,-
 auxiliary educational services; or
 renting of immovable property
Auxiliary Educational Services

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 Auxiliary Educational Services— means
 any services relating to
 imparting any skill, knowledge, education or
 development of course content or
 any other knowledge enhancement activity, whether for the students or the faculty, or
 any other services—
 which educational institutions ordinarily carry out themselves but may obtain as outsourced services from
any other person,
 including services relating to
 admission to such institution, conduct of examination,
 catering for the students under any mid-day meals scheme sponsored by Government, or
 transportation of students, faculty or staff of such institution

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Circular 172/7/2013-ST:

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 With effect from 11.07.2014:
Services provided,-
 by an educational institution to its students, faculty and staff;
 to an educational institution, by way of,-
 transportation of students, faculty and staff;
 catering, including any mid-day meals scheme sponsored by the Government;
 security or cleaning or house-keeping services performed in such educational
institution;
 services relating to admission to, or conduct of examination by, such institution

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 Following services are exempted
 National Skill Development program implemented by NSDC
 Vocational courses under
 National Skill Cert. and Monetary reward scheme
 Any other scheme implemented by NSDC
 Exemption is available to following service providers
 NSDC
 Sector Skill Council
 Assessment agency
 Training partner
Skill Development Programs

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 Services provided to a recognised sports body by—
 By an individual as player, referee, umpire, coach, team manager for
participation in a sporting event organised by a recognised sports body
 Another recognised sports body
Services to a Recognised Sports Body

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 "recognized sports body" means –
 the Indian Olympic Association,
 Sports Authority of India,
 a national sports federation recognised by the Ministry of Sports and Youth Affairs of the
Central Government, and its affiliate federations,
 national sports promotion organisations recognised by the Ministry of Sports and Youth
Affairs of the Central Government,
 the International Olympic Association or a federation recognised by the International
Olympic Association or
 a federation or a body which regulates a sport at international level and its affiliated
federations or bodies regulating a sport in India;
Services to a Recognised Sports Body

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