Notes 07 - Notes on clauses - Service Tax - Finance Bill, 2013

Service Tax Clause 93 seeks to amend Chapter V of the Finance Act, 1994 relating to service tax in the following manner, namely:- Sub-clause (A) seeks to amend section 65B of the said Act, so as to modify the scope of certain services. Sub-clause (B) seeks to omit Explanation to section 66B of the said Chapter inserted by issuing a notification under subsection (1-I) of section 95 thereof since a new section 66BA is being inserted to the same effect. Sub-clause (C) seeks to insert a new section 66BA in the said Chapter, so as to clarify that reference to section 66 in the Act or any other Act for the time being in force shall be construed as reference to the provisions of section 66B. This sub-clause shall come into effect retrospectively with effect from the 1st day of July, 2012. Sub-clause (D) seeks to omit the word seed from sub-clause (i) of clause (d) of the section 66D so as to modify the scope of the service. Sub-clause (E) seeks to insert a new sub-section (2A) in section 73 with a view to save the notices issued for extended period under the proviso to sub-section (1), in cases where any appellate authority or tribunal or court decides that such notices are not sustainable on the grounds specified therein. Such notices shall be deemed to have been issued under sub-section (1) for invoking normal limitation. Sub-clause (F) seeks to amend clause (a) of sub-section (1) of section 77, to restrict the maximum penalty for failure to take registration, to rupees ten thousand. Sub-clause (G) seeks to insert a new section 78A, so as to impose penalty, which may extend up to one lakh rupees, on director, manager, secretary or other officer of the company for knowingly involved in the contraventions specified therein. Sub-clause (H) seeks to amend section 83 so as to substitute the figure and letter 9A with the words, brackets, figures and letter sub-section (2) of section 9A with the view to apply only subclause (2) of section 9A of the Central Excise Act, 1944 to service tax. Sub-clause (I) seeks to amend sub-section (5) of section 86 of the said Chapter to empower the tribunal to condone the delay in filing appeal or cross objection by the assessee also. Sub-clause (J) seeks to substitute clauses (i) and (ii) of subsection (1) of section 89 so as to provide that (i) in the case of an offence specified in clauses (a), (b) and (c) of sub-section (1) where the amount exceeds fifty lakh rupees, the punishment shall be imprisonment for a term which may extend to three years, but shall not, in any case, be less than six months; (ii) in the case of an offence specified in clause (d) of sub-section (1) where the amount exceeds fifty lakh rupees, the punishment shall be imprisonment for a term which may extend to seven years, but shall not, in any case, be less than six months; (iii) in the case of any other offence, the punishment shall be imprisonment for a term which may extend to one year. It further seeks to substitute sub-section (2) thereof so as to provide that a person convicted of an offence punishable under clauses (i) and (iii) shall be punished for every second and subsequent offence with imprisonment for a term which may extend to three years and in the case of an offence punishable under clause (ii), shall be punished for every second and subsequent offence with imprisonment for a term which may extend to seven years. Sub-clause (K) seeks to insert new sections 90 and 91. The proposed section 90 seeks to provide that an offence under clause (ii) of sub-section (1) of section 89 shall be cognizable and all other offences shall be non-cognizable and bailable. The proposed section 91 seeks to provide for power to arrest. It seeks to empower the Commissioner of Central Excise, to authorise any officer of Central Excise not below the rank of Superintendent of Central Excise, to arrest a person for the offences specified in clause (i) or clause (ii) of sub-section (1) of section 89. It further seeks to empower the Assistant Commissioner or the Deputy Commissioner to release the person so arrested on bail in case of non-cognizable and bailable offences, and for this purpose, he shall have the same power as that of an officer-in-charge of a police station and shall be subject to provisions under section 436 of the Code of Criminal Procedure, 1973. It also seeks to provide that the arrests so made shall be carried out in accordance with the provisions of the Code of Criminal Procedure, 1973, relating to arrests. Sub-clause (L) seeks to amend section 95 so as to empower the Central Government to issue orders for removal of difficulty in case of certain provisions inserted by the proposed amendments in this Chapter, up to one year from the date of commencement of the Finance Bill, 2013. Sub-clause (M) seeks to insert new section to provide exemption from service tax to the extent notices have been issued upto the 28th February, 2013 under section 73, in respect of taxable services provided by the Indian Railways during the period prior to the 1st day of July, 2012.