Board's Blunder Continues - GTA Exemption amended, but 1/2006 left untouched
YESTERDAY, DDT reported, “Board Blunderland – Amends non existing entries”. We deeply regret the usage of such words like blunder for an august body like the CBEC – we never believed they are capable of something far more than blunder. Blunder was a gross understatement! Yesterday we reported that they amended Notification No. , wherein they amended a non existent entry - Sl. No 6, which they had omitted in 2008. They made quick damage control exercises and came up with an amendment to Notification No. 13/2008, which causes more damage than the original blunder.
With this amendment, there is a possibility of the tax payers claiming exemption from 75% of the value for all the services falling under sub-clauses (zn) (port service) or (zzl) (other port service) or (zzm) (Air port service). There is every possibility of the benefit being extended by the appellate forums because of the wording of the Notification.
By Notification No. Dated: June 28 2010, they amended Sl. No. 6 of the Notification No. , without realising that Sl. No. 6 was omitted in 2008. Now they have tried to rectify the damage by amending Notification No. 13/2008, but have landed in more blunderland .
The whole confusion started with the amendment of the definition of port services. Now any service rendered in a port would be port services. Thus even if the 'rent a cab service' is provided within a port, it would become port service. Apparently the Government wanted to give the abatement allowed to several services, even if provided within the port. So they amended Notification No. 1/2006 to give the same rates of abatements to the services entitled for abatements. In the process they also amended the non-existing Sl. No. 6, which once upon a time was in relation to abatement on GTA Service. Having realised their blunder, instead of correcting the mistake they made in Notification No. , they hastily amended Notification No. 13/2008.
Notification No. 13/2008,
exempts the taxable service provided by a goods transport agency to any person in relation to transport of goods by road in a goods carriage, referred to in sub-clause (zzp) of clause (105) of section 65 of the Finance Act, from so much of the service tax leviable thereon under section 66 of the Finance Act, as is in excess of the amount of service tax calculated on a value equivalent to twenty five per cent. of the gross amount charged by the goods transport agency for providing the said taxable service.
After the amendment, this notification will read as,
exempts the taxable service provided by a goods transport agency to any person in relation to transport of goods by road in a goods carriage, referred to in sub-clause (zzp) or (zn) or (zzl) or (zzm) of clause (105) of section 65 of the Finance Act, from so much of the service tax leviable thereon under section 66 of the Finance Act, as is in excess of the amount of service tax calculated on a value equivalent to twenty five per cent. of the gross amount charged by the goods transport agency for providing the said taxable service.
What they mean is that GTA Service in the port will get an abatement of 75%. But then what happens to the amendment they made to Sl. No. 6 of Notification No.? They are not ready to correct that mistake - yet!
There is always an easy solution to every human problem - neat, plausible, and wrong.
Notification No. Dated: June 30 2010