Service tax on interconnection service

The interconnection service is provided by one telegraph authority to another to enable the telephone subscribers of these telegraph authorities to connect with each other

CBEC has issued a circular no. 91/2/2007-dated 12-3-2007 to clarify that IUC charges are not subject to service tax.

This circular has been issued by providing reference to the new definition of 'telecommunication service' which is to be incorporated vide clause (104) of section 65 of the Finance Act, 1994.