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Summary of Point of Taxation rules 2011 amended by finance act 2016

Scenario
Relevant Rule
First Event
Subsequent Event
Point of Taxation
New Services
5(a) of POTR
Invoice Issued and Payment received before service became taxable
N.A
No ST Payable
5(b) of POTR
Payment received before service became taxable
Invoice issued with in 14 days when service is taxed for first time
No ST Payable
3(a) of POTR
Service provided before tax became effective
Invoice issued with in 14 days & payment received after tax became effective
No ST Payable
Taxable service provided before change in effective rate of ST
4(a)(i) of POTR
Invoice Issued and Payment received after change is effective rate
N.A
Date of Receipt of payment or date of issuance of invoice which ever is earlier
4(a)(ii) of POTR
Invoice Issued prior to change in effective rate
Payment received after change in Effective rate of tax
Date of issuing invoice
4(a)(iii) of POTR
Payment received before change in effective rate
Invoice issued after change in effective rate of tax
Date of Receipt of payment.
Taxable service provided after change in effective rate of ST
4(b)(i) of POTR
Invoice Issued prior to change in effective rate
Payment received after change in Effective rate of tax
Date of Receipt of payment.
4(b)(ii) of POTR
Invoice Issued and Payment received Prior change is effective rate
Taxable Service Provided
Date of Receipt of payment or date of issuance of invoice which ever is earlier
4(b)(iii) of POTR
Payment received before change in effective rate
Invoice issued after change in effective rate of tax
Date of issuing invoice

Clarifications on various aspects of Swachh Bharat Cess

Dear Professional Colleague,
Clarifications on various aspects of Swachh Bharat Cess
Recently, the Central Government vide Notification No. 21/2015-ST and 22/2015-ST, both dated November 6, 2015 had appointed November 15, 2015 as the date from which, Swachh Bharat Cess (“SB Cess”)at the rate of 0.5% on value of all taxable services shall be applicable. However, a sudden imposition of SB Cess created lot of confusionslike to calculate value of taxable services under Abatement Notification, treatment of SB Cess on ongoing transactions, availability of Cenvat credit of SB Cess, etc. Thus, the Central Government has issued following Notifications in order to clarify certainaspects of applicability of SB Cess:
SB Cess at the rate of 0.5% will be levied on value of all taxable services after availing abatement – Notification No. 23/ 2015-ST dated November 12, 2015:
The Central Government has amended Notification No. 22/2015-ST dated November 6, 2015,wherein an effective rate of 0.5%of the value of all taxable services was fixedto clarify that SB Cess will be leviedon value of taxable services afteravailing the benefit of abatements by way of an exemption provided vide Abatement Notification No. 26/2012-ST dated June 20, 2012 i.e. SB Cess would be computed on abated value.
For example, in case of GTA services, presently, abatement of 70% is available and accordingly, Service tax is required to be paid on 30% of value of taxable service after exemption (abatement) of 70% as provided under the said Abatement Notification. The effective rate of Service taxincluding SB Cess would be 4.35% (i.e. 30% of 14.5%).
Value of taxable services for the purposes of SB Cess shall be the value as determined in accordance with the Service Tax (Determination of Value) Rules, 2006 – Notification No. 23/ 2015-ST dated November 12, 2015:
Notification No. 22/2015-ST dated November 6, 2015 has been further amended to provide that value of taxable services for the purposes of SB Cess shall be the value as determined in accordance with the Service Tax (Determination of Value) Rules, 2006. Thus, SB Cess would be levied in the following manner:
a.        Computation of tax under Works contract: In terms of Rule 2A of the Service Tax (Determination of Value) Rules, 2006, Service tax along with SB Cess needs to be applied on taxable value. Accordingly, effective rate of tax would be as under:
ü   In case of original works: 5.8% (14.5%*40%); and
ü   Other than original works: 10.15% (14.5%*70%)
b.        Computation of tax on Restaurant and Outdoor catering services:In terms of Rule 2C of the Service Tax (Determination of Value) Rules, 2006, Service tax along with SB Cess needs to be applied on taxable value.. Accordingly, effective rate of tax would be as under:
ü   In case of AC Restaurant services: 5.8% (14.5%*40%); and
ü   In case of Outdoor catering services: 8.7% (14.5%*60%)
SB Cess along with Service tax shall be paid on services under Reverse Charge Mechanism– Notification No. 24/ 2015-ST dated November 12, 2015:
The Reverse Charge Notification No. 30/2012-ST dated June 20, 2012 prescribes the specified services under full reverse charge wherein 100% service tax to be paid by the Service Recipient and under partial reverse charge wherein both the Service provider and service recipient has to pay specified percentage of Service tax.Now, the Central Government vide Notification No. 24/ 2015-ST dated November 12, 2015, has explicitly clarified that Service tax liability under Reverse charge/ partial reverse charge shall be applicable for the purposes of SB Cess mutatis mutandis.In other words, SB cess along with Service tax shall be paid on taxable services under Reverse Charge Mechanism as well.
Amendment made in Service Tax Rules, 1994 for providing alternate rate for SB Cess– Notification No. 25/ 2015-ST dated November 12, 2015:
As per sub-rules 7,7A,7B and 7C to Rule 6 of the Service Tax Rules, 1994, there is an alternative rate of Service tax for services, namely, air travel agents, insurance premium, purchase & sale of foreign currency and lottery.
Now, the Central Government has amendedService Tax Rules, 1994 vide Notification No. 25/ 2015-ST dated November 12, 2015and thereby, inserted sub-rule (7D) after (7C) under Rule 6 as under:
“(7D) The person liable for paying the service tax under sub-rule (7), (7A), (7B) or (7C) of rule 6, shall have the option to pay such amount as determined by multiplying total service tax liability calculated under sub-rule (7), (7A), (7B) or (7C) of rule 6 by 0.5 and dividing the product by 14 (fourteen),during any calendar month or quarter, as the case may be, towards the discharge of his liability for Swachh Bharat Cess instead of paying Swachh Bharat Cess at the rate specified in sub-section (2) of section 119 of the Finance Act, 2015 (20 of 2015) read with notification No.22/2015-Service Tax, dated the 6th November, 2015, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 843 (E), dated the 6th November, 2015, and the option under this sub-rule once exercised, shall apply uniformly in respect of such services and shall not be changed during a financial year under any circumstances."
In other words, if Service tax is payable at an alternative rate, SB cess would also be computed in proportion to such alternative rate in following manner:
Total Service tax liability calculated under Rule 6(7)(7A), (7B) or (7C) * 0.5
14
For example, in case of air travel agent services, air travel agent opting alternative rate optionis liable to pay Service tax at the rate of 0.7% of the basic fare in case of domestic bookings. Therefore, SB Cess would be payable at the rate of 0.025% i.e. 0.5 multiplied by 0.7% divided by 14 on this service.
To access complete Notifications, please click on the link below:
Point of Taxation
It is pertinent here to note that the Finance Ministry in its Press Release dated November 12, 2015 has clarified that for determining event when the new levy i.e. SBCess will be leviable ontaxable services, norms laid down in terms of Rule 5 of the Point of Taxation Rules, 2011 would apply in the following manner:
(i) in case where payment has been received and invoice is raised before the service becomes taxable, i.e., prior to November 15, 2015, there is no liability of SB Cess.
(ii) In case payment has been received before the service became taxable and invoice is raised within 14 days from the date service is taxed first time, i.e. uptoNovember 29, 2015, even then the Service tax liability does not arise. In other words, SB Cess will be payable where service is provided on or after November 15, 2015 but payment is received prior to that date and invoice in respect of such service is not issued by November 29, 2015.
An illustrative table to above clarification is given as under:
S. No.
Date of applicability of SB Cess
Date of Invoice
Date of Payment Received
Applicability of SB Cess
1.
15thNovember, 2015
25thNovember, 2015
1stNovember, 2015
No
2.
15th November, 2015
30th November, 2015
1st November, 2015
Yes
3.
15th November, 2015
1st November, 2015
1st November, 2015
No
4.
15th November, 2015
16th November, 2015
16th November, 2015
Yes

Our Comments: Under the Finance Act, Section 66B of the Finance Act, 1994 is the charging Section which levy Service tax on taxable services. We are reproducing herewith Section 66B of the Finance Act for the ease of convenience:
“66B. Charge of service tax on and after Finance Act, 2012.
There shall be levied a tax (hereinafter referred to as the service tax) at the rate of twelve per cent. on the value of all services, other than those services specified in the negative list, provided or agreed to be provided in the taxable territory by one person to another and collected in such manner as may be prescribed.”
The literal interpretation of the charging Section 66B of the Finance Act means that the levy of Service tax is on the value ofall taxable services ‘provided or agreed to be provided’. However, the collection of Service tax may be shifted to any point/ stage/event, in any manner, as prescribed by the Rules made in this behalf.
The Hon’ble Supreme Court in the case of All India Federation of Tax Practitioners Vs. Union of India [2007-TIOL-149-SC-ST] held that “a tax on a thing or goods can only be with reference to a taxable event” and the same contention was upheld again in the case of Association of Leasing & Financial Service Companies Vs. Union of India [2010 (20) STR 417 (SC)], wherein the Hon’ble Supreme Court observed that the taxable event under the Service tax law is the rendition of service.
In view of the above discussed provisions, the matter is subjected to debate as to whether SB Cess would be leviable on a service rendered prior to November 15, 2015 when SB Cess was not applicable at the time of its rendition, merely because its payment is received on or after the date of levy or the invoice is not issued within 14 days of the date of levy.
Here it would not be out of place to mention that POT Rules were framed by the Central Government in exercise of the powers conferred under Section 94 of the Finance Act, 1994 and such delegated legislation cannot be extended to go beyond the vires of the Finance Act, 1994.
FAQs released by CBEC on SB Cess
The Board has issued Frequently Asked Questions (FAQs) on SB Cess wherein certain issues under SB Cess has been clarified like:
“Q.8 Whether separate accounting code will be there for Swachh Bharat Cess?
Ans. Yes, for payment of Swachh Bharat Cess, a separate accounting code would be notified shortly in consultation with the Principal Chief Controller of Accounts. These are as follows:-
Swachh Bharat Cess
(Minor Head)
Tax
Collection
Other Receipts
Penalties
Deduct
Refunds
0044-00-506
00441493
00441494
00441496
00441495

Q.14 Whether Cenvat Credit of the SBC is available?
Ans. SBC is not integrated in the Cenvat Credit Chain. Therefore, credit of SBC cannot be availed. Further, SBC cannot be paid by utilizing credit of any other duty or tax.”
To access complete FAQs, please click on the link below:
In order to access our earlier article on SB Cess, please click on the link below:
Hope the information will assist you in your Professional endeavours. In case of any query/ information, please do not hesitate to write back to us.
Thanks & Best Regards,                                                    
Bimal Jain
FCA, FCS, LLB, B.Com (Hons)
Author of a book on Goods and Services Tax, titled, "GOODS AND SERVICES TAX – INTRODUCTION AND WAY FORWARD" (1st Edition)
A2Z TAXCORP LLP
Tax and Law Practitioners
Delhi:
Flat No. 34B, Ground Floor,
Pocket – 1, Mayur Vihar Phase-1
Delhi – 110091 (India) 
Tel: +91 11 22757595/ 42427056
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Allahabad - 211001
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Panchkula, Haryana – 134115
 Kolkata:
Ist Floor, 10 R G Kar Road
Shyambazar, Kolkata – 700 004


Disclaimer: The contents of this document are solely for informational purpose. It does not constitute professional advice or recommendation of firm. Neither the authors nor firm and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any information in this document nor for any actions taken in reliance thereon.

Readers are advised to consult the professional for understanding applicability of this newsletter in the respective scenarios. While due care has been taken in preparing this document, the existence of mistakes and omissions herein is not ruled out. No part of this document should be distributed or copied (except for personal, non-commercial use) without our written permission.
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CA Final and CA IPC November 2015 Exam dates.

TO BE PUBLISHED IN PART III SECTION 4 OF THE GAZETTE OF INDIA 

NOTIFICATION                                                                  21 July, 2015 

No. 13-CA (EXAM)/N/2015: In pursuance of Regulation 22 of the Chartered Accountants Regulations, 1988, the Council of the Institute of Chartered Accountants of India is pleased to notify that the Intermediate (IPC) and Final examinations will be held on the dates given below at the following  places provided that sufficient number of candidates offer themselves to appear from each centre. 


Similarly, Examinations in Post Qualification Courses under Regulations 204, viz.: Management Accountancy Course (MAC) Part – I, Corporate Management Course (CMC) Part – I, Tax Management Course (TMC) Part – I, Insurance and Risk Management (IRM), and International Trade Laws and World Trade Organisation (ITL & WTO) examinations (which are open to the members of the Institute) will be held on the dates given below at the above places (centres in India only) provided that sufficient number of candidates offer themselves to appear from each of the above places. 

INTERMEDIATE (IPC) EXAMINATION 
[As per syllabus contained in the scheme notified by the Council under Regulation 28 E (3) of the Chartered Accountants Regulations, 1988] 

Group-I: 2nd, 4th, 6th & 8th November 2015 
Group-II: 10th, 13th & 15th November 2015 
(Afternoon Session: 2.00 PM to 5.00 PM) (IST) 

FINAL EXAMINATION
[As per syllabus contained in the scheme notified by the Council under Regulation 31 (ii) of the Chartered Accountants Regulations, 1988.] 

Group -I: 1st, 3rd, 5th & 7th November 2015 
Group -II: 9th, 12th, 14th & 16th November 2015 
(Afternoon Session: 2.00 PM to 5.00 PM) (IST) 


MANAGEMENT ACCOUNTANCY COURSE (MAC) PART - I, CORPORATE MANAGEMENT COURSE  (CMC) PART – I, TAX MANAGEMENT COURSE (TMC) PART – I EXAMINATIONS

Group-I: 9th & 12th November 2015 
Group-II: 14th & 16th November 2015 
(Afternoon Session: 2.00 PM to 5.00 PM) (IST) 

INSURANCE AND RISK MANAGEMENT (IRM) EXAMINATION

Modules I to IV 9th, 12th, 14th & 16th November 2015 
(Afternoon Session: 2.00 PM to 5.00 PM) (IST) 

INTERNATIONAL TRADE LAWS AND WORLD TRADE ORGANISATION (ITL&WTO) EXAMINATION

Group A 2nd , 4th & 6th November 2015 
Group B 8th, 10th & 13th November 2015 
(Afternoon Session: 2.00 PM to 5.00 PM) (IST) 


For More details download the official notification










The Result of the CA IPC Examination held in May, 2015 is likely to be declared on Friday, the 31st July, 2015

The result of the Chartered Accountants Intermediate (Integrated Professional Competence) Examination held in May, 2015 is likely to be declared on Friday, the 31st July, 2015 around 4.00 P.M. and the same as well as the merit list (candidates securing a minimum of 55% and above marks and upto the maximum of 50th Rank on all India basis will be available on the following website: 

                                        http://www.caresults.nic.in

Arrangements have also been made for the students of Intermediate (IPC) Examination desirous of having results on their e-mail addresses to register their requests at the above website, i.e., http://www.caresults.nic.in from 27th July, 2015. All those registering their requests will be provided their results through e-mail on the e-mail addresses registered as above immediately after the declaration of the result. 

In addition to above, it may be noted that for accessing the result at the above website i.e. http://www.caresults.nic.in the candidate shall have to enter his registration no. or PIN no. alongwith his roll number. 

Further facilities have been made for candidates of Intermediate (IPC) Examination held in May, 2015 desirous of knowing their results with marks on SMS. The service will be available through India Times. 

For getting results through SMS candidates should type: 

CAINTER(Space)XXXXXX (where XXXXXX is the six digit Intermediate (IPC) Examination roll number of the candidate) 

e.g. CAINTER 302971 and send the message to 

58888 - for all mobile services - India Times

(B. MURALIDHARAN)
DEPUTY SECRETARY (EXAMS.)


tags: CA IPC, ca ipcc, Results, ca ipc may 2015 result,












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