Service Tax is leviable on all services other than services which are specified under the negative list but trading (which is buying and selling of goods) is not a service and therefore it is specified under the negative list. This is to overcome the recent judgment of CESTAT, Ahmedabad in which the Tribunal held that trading activity is covered under sales and cannot be called a service. This article highlights the real intention behind specifying trading of goods under the negative list of services.
Notifications and Circulars section under Customs portion covers various changes including release of new Foreign Trade Policy introducing new export promotion schemes like MEIS and SEIS and bringing certain changes in others schemes like EPCG and Advance Authorization. Under Ratio Decidendi this issue covers a summary of the order passed by the Madras High Court that assessee would be entitled for suo motu refund of EDD on finalization of provisional bills of entry.
Central Excise part of this Amicus has many recent decisions of Supreme Court including decisions holding that security holograms are classified as product of printing industry and another case relating to classification wherein the Supreme Court relying on essential character test held that blended marble vinyl flooring is not plastic tile.
Under Service Tax portion this newsletter covers recent CBEC circular clarifying that new rate of Service Tax is not in force yet and shall come into effect from a date which will be notified by the Central Government. It also provides summaries of orders passed by the Tribunal holding that inspection and rectification of defects of export goods would not be covered under technical testing service and that assessee would not be liable to pay service tax under business auxiliary services while working on job work basis in respect of conversion of black bars to bright bars.
Under Value Added Tax (VAT), this issue covers Notifications and Circulars issued by different State Governments relating to changes made in VAT for mobile phones and their accessories. This issue brings to readers the order of Kerala High Court holding that after diluting the impugned goods with water no new product was manufactured and hence the product would remain classified under the same HSN number.
April, 2015/Issue-46