TWO MASTER CIRCULARS ON SERVICE TAX ISSUED

As a trade facilitation measure, the Central Government issued, here today two consolidated circulars containing clarifications on issues relating to levy of service tax in lieu of all the clarifications issued so far:

(i)   No.96/7/2007-ST dated 23.08.07, on matters relating to technical issues, and

(ii)  No.97/8/2007-ST dated 23.08.07, on matters relating to procedures.

These Circulars intend to meet the demand of the trade and industry to make available all clarifications relating to service tax at one place in a simple and comprehensive manner. A coding system is followed to facilitate easy reference.

Government appointed a Committee to undertake a comprehensive review of the clarifications issued on matters relating to service tax since the introduction of service tax in 1994.  Comments, views and suggestions of the trade and industry associations, departmental officers and others were also sought. The committee submitted the report to the Government and the report of the Committee was placed on the CBEC web site for comments and suggestions.

Two draft Circulars were prepared and placed on CBEC website seeking views and suggestions. After taking into consideration the report, views and suggestions received from the trade and industry associations, departmental officers and others, these two Circulars have been issued today.

These two Circulars supersede all earlier circulars, clarifications and communications issued from time to time by the CBEC, DG (Service Tax) and various field formations on matters relating to levy of service tax. However, orders issued for the purposes of uniformity in connection with classification of services under section 37B of the Central Excise Act, 1944 read with section 83 of the Finance Act, 1994, by the CBEC, continue to be valid.

Views stated in the Master circulars reflect the interpretation of the law and the current practice of the department. These circulars are not to be treated as part of law and do not over ride the legal provisions. The relevant statutory provisions must be referred to and they will prevail.

For details, the circulars may be referred to.