TMI BlogServices by Government or a local authorityX X X X Extracts X X X X X X X X Extracts X X X X ..... be kept in accordance with article 150 of the Constitution or the rules made thereunder;] (Inserted vide THE FINANCE ACT, 2015 w.e.f. 14th May 2015) Section 65B(7) - aircraft has the meaning assigned to it in clause (1) of section 2 of the Aircraft Act, 1934; Section 65B(8) - airport has the meaning assigned to it in clause (b) of section 2 of the Airports Authority of India Act, 1994; Section 65B(17) - business entity means any person ordinarily carrying out any activity relating to industry, commerce or any other business; Section 65B(25) - goods means every kind of movable property other than actionable claim and money; and includes securities, growing crops, grass, and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale; Section 65B(31) - local authority means- (a) a Panchayat as referred to in clause (d) of article 243 of the Constitution ; (b) a Municipality as referred to in clause (e) of article 243P of the Constitution; (c) a Municipal Committee and a District Board, legally entitled to, or entrusted by the Government with, the control ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to Government in such activities would lead to competitive inequities; and to avoid break in Cenvat chain as the support services provided by Government are normally in the nature of intermediary services. 2.4.7 What is the meaning of 'Government'? The phrase 'Government' has not been defined in the Act. As per clause (23) of section 3 of the General Clauses Act, 1897 'Government' includes both Central Government and any State Government. As per clause (8) of section 3 of the said Act 'Central Government', in relation to anything done or to be done after the commencement of the Constitution, mean the President. As per article 53 of the Constitution the executive power of the Union shall be vested in the President and shall be exercised by him either directly or indirectly through officers subordinate to him in accordance with the Constitution. Further, in terms of article 77 of the Constitution all executive actions of the Government of India shall be expressed to be taken in the name of the President. Therefore, the Central Government means the President and the officers subordinate to him while exercising the executive po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ernmental authority' has been defined in the said mega exemption as a board, or an authority or any other body established with 90% or more participation by way of equity or control by Government and set up by an Act of the Parliament or a State Legislature to carry out any function entrusted to a municipality under article 243W of the Constitution . Thus some of these local bodies may comprise governmental authorities. 2.4.10 Would various entities like a statutory body, corporation or an authority constituted under an Act passed by the Parliament or any of the State Legislatures be 'Government' or local authority ? A statutory body, corporation or an authority created by the Parliament or a State Legislature is neither 'Government' nor a 'local authority' as would be evident from the meaning of these terms explained in point nos. 2.3.7 and 2.3.8 above respectively. Such statutory body, corporation or an authority are normally created by the Parliament or a State Legislature in exercise of the powers conferred under article 53(3)(b) and article 154(2)(b) of the Constitution respectively. It is a settled position of law Government ( Aga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he negative list except the following : ( a ) services provided by the Department of Posts by way of speed post, express parcel post, life insurance, and agency services carried out on payment of commission on non government business; ( b ) services in relation to a vessel or an aircraft inside or outside the precincts of a port or an airport; ( c ) transport of goods and/or passengers; ( d ) support services, other than those covered by clauses (a) to (c) above, to business entities. 4.1.2 Would the taxable services provided by the Government be charged to tax if they are otherwise exempt or specified elsewhere in the negative list? No. If the services provided by the government or local authorities that have been excluded from the negative list entry are otherwise specified in the negative list then such services would also not be taxable. 4.1.3 'Government' has not been defined in the Act. What is the meaning of Government? Please refer to point no. 2.4.7. 4.1.4 Are various corporations formed under Central Acts or State Acts or various government companies registered under the Companies Act, 1956 or autonomous institutions set up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us do not constitute support services.) 4.1.8 Will the services provided by Police or security agencies to PSUs or corporate entities or sports events held by private entities be taxable? Yes. Services provided by government security agencies are covered by the main portion of the definition of support service as similar services can be provided by private entities. In any case it is also covered by the inclusive portion of the definition. However the tax will be actually payable on reverse charge by the recipient. 4.1.9 What is the meaning of local authority? Please refer to point no 2.4.8 and 2.4.9. 4.1.10 Department of Posts provides a number of services. What is the status of those services for the purpose of levy of service tax? As per sub-clause (i) of clause (a) of section 66D services provided by the Department of Posts by way of speed post, express parcel post, life insurance, and agency services carried out on payment of commission on non government business are excluded from the negative list. Therefore, the following services provided by Department of Posts are not liable to service tax. Basic mail services known as postal services such ..... X X X X Extracts X X X X X X X X Extracts X X X X
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