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2011 (11) TMI 307 - KARNATAKA HIGH COURTLiability to pay Service tax by government authority undertaking Insurance business – assessee contending it to be soverign function and thus exemption from payment of service tax under para 2 of circular No. 89/7/2006-Service Tax, dated 18th December 2006 – Held that:- Insurance business is not a sovereign act. It is squarly covered by paragraph 3 of the said circular which provides that if a government authority performs a service which is not in the nature of statutory activity and the same is undertaken for a consideration not in the nature of statutory fee/levy, then in such cases, service tax would be leviable and it falls within the ambit of taxable service. - Decided against the assessee.
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