Service Tax — Clearing and forwarding agents - Service Tax - Trade Notice No. 85/99

Attention of the Trade is invited to Notification No. 7/99-Service Tax, dated 23rd August, 1999 [1999 (112) E.L.T. N32]. By virtue of the said notification sub-clause (iii) in Clause (d) in sub-rule (1) in Rule 2 in the Service Tax Rules, 1994 is omitted and as a result the method of payment of Service Tax in respect of taxable services provided by Clearing and Forwarding Agents has been changed. The Clearing and Forwarding Agents shall henceforth pay the Service Tax in respect of taxable services rendered by them instead of the person who engages such agent. This change will come into force from the 1st of September, 1999. The provisions relating to Registration, Furnishing of Returns and Assessment as in existence will apply on the Clearing and Forwarding Agents who shall now be liable to pay the Service Tax as per Section 68(1) with effect from 1-9-1999. The value of taxable service rendered by clearing and forwarding agents continue to remain as the gross amount of remuneration or commission (by whatever name called) paid to such agent by the principal or the client engaging such agent as provided under sub-rule (8) to Rule 6 of the Service Tax Rules, 1994. For the convenience of the prospective assessees to be registered as CLEARING AND FORWARDING AGENTS some of the salient features of the provisions of Service Tax Law are furnished below : Registration : In terms of Rule 4 of Service Tax Rules, 1994 , every person liable for paying the Service Tax shall make an application to the concerned Central Excise Officer in Form ST-1 for registration within period of thirty days from the date on which the Service Tax is levied. If an assessee is providing a taxable service from more than one premises or offices and has a certralised billing system in respect of such services rendered to clients from such premises or offices at any one premises or office, he may opt for registering only the premises or office from where such centralised billing is done. If an assessee is providing taxable service from more than one premises or office and does not have any centralised billing system, he shall make separate application for registration in respect of each such premises or office to be concerned Central Excise Officer. The assessees will apply for Registration in Form ST-1. An acknowledgement will be provided on the duplicate copy of the ST-1 by the Superintendent of Central Excise in whose jurisdiction the assessee operate. The Registration Certificate will be granted in Form ST-2 within seven days from the date of receipt of application for Registration. Maintenance of Records : As per Rule 5 of the Service Tax Rules, 1994 , the records (including computerised data) as maintained by an assessee in accordance with the various laws in force from time to time is acceptable and every assessee shall furnish to the Central Excise Officer at the time of filing his return for the first time a list of all accounts maintained by the assessee in relation to service tax including memoranda received from his branch office. Payment of Tax : In terms of Rule 6 ibid the service tax on the value of taxable services received during any calendar month shall be paid to the credit of the Central Government by the 25th of the month immediately following the said calendar month. Provided where the assessee is an individual or proprietory firm or partnership firm, the service tax on the value of taxable services received during any quarter shall be paid to the credit of the Central Government by the 25th of the month immediately following the said quarter. Return : In terms of Rule 7 ibid every assessee shall submit a half yearly return in Form ST-3 or ST-3A as the case may be, along with a copy of the Form TR-6 , in triplicate for the months covered in the half-yearly return, by the 25th of the month following the particular half year. Chapter V of Finance Act, 1994 and Service Tax Rules, 1994 as amended has already been communicated vide this office Trade Notice No. 102/98(11/Service Tax/98), dated 16-10-1998. In case of any difficulty the assessees are requested to contact the jurisdictional Superintendent of Central Excise, or the Deputy/Assistant Commissioner of Central Excise in charge of divisions or the Service Tax Unit of this office.