Service Tax - Haj and Mansarovar get exemption
THERE has been a long standing demand by Haj Committee and Private Tour operators that Haj pilgrims should be exempted from Service Tax at least for the transport part.
The Government has now exempted:
"Services by Kumaon Mandal Vikas Nigam Limited and the Haj Committee in respect of a religious pilgrimage facilitated by the Ministry of External Affairs of the Government of India, under bilateral arrangement. "
The Kumaon Mandal Vikas Nigam and Haj Committee facilitates religious pilgrimage to Mansarovar and Haj/Umrah respectively.
As per the exemption only the services provided by the above two organisations are exempted. What about the private tour operators who actually provide the service on behalf of the Haj Committee?
Board had in Circular No. 117/11/2009 - ST, dated 30.10.2009 clarified that the amount charged to the pilgrims in India undertaking Haj and Umrah pilgrimage, is for services provided by the Government of Saudi Arabia and the tour takes place outside India. As per Rule 3 (1) (ii) of the Export of Services Rules, 2005, (Circular No. 111/05/2009 - ST dated 24.02.2009), the service in respect of tour operator is export if such service is performed outside India. It is also provided therein that where such taxable service is partly performed outside India, it shall be treated as performed outside India. Therefore, it is clarified that service tax is not chargeable on the services provided in respect of tour undertaken for carrying out Haj and Umrah Pilgrimage in Saudi Arabia by Indian pilgrims considering these as export of service, provided they fulfill the other conditions of export as provided in Export of Service Rules.
This clarification is perhaps not valid after 1.7.2012.
Notification No. , Dated: August 20, 2014