Telecommunication service - Clarification on taxability in respect of International Private Leased Circuit (IPLC) - Service Tax - F. No. 137/21/2011

Telecommunication service - Clarification on taxability in respect of International Private Leased Circuit (IPLC) Letter [F. No. 137/21/2011 - Service Tax], Dated 19-12-2011 Please refer to the clarifications issued vide Board's letter of even number dated 15-7-2011 on the subject mentioned above. 2. The matter has been re-examined and it is seen that the IPLC is specifically covered by the definition of the telecommunication service given in clause 65(109a)(iv) of the Finance Act, 1994. As per the said section these services are taxable only when provided by a person who has been granted a licence under the first proviso to sub-section (1) of section 4 of the Indian Telegraph Act, 1985. It is only because the foreign telecom service provider cannot constitute a telegraph authority under an Indian law that they remain outside the taxability clause of the telecommunication service. 3. Therefore, the view taken in the said letter that what otherwise constitutes a telecommunication service would amount to business support service is erroneous. 4. The clarification issued vide the above mentioned letter stands corrected accordingly.