Point of Taxation Rules, 2011
[18/2011-Service Tax dated 01.03.2011 as amended]
In exercise of the powers
conferred under clause (a) and clause (hhh) of sub-section (2) of section 94 of
the Finance Act, 1994, the Central Government hereby makes the following rules
for the purpose of collection of service tax and determination of rate of
service tax, namely,-
1.
Short title and commencement.-
(1) These rules shall be called the Point of
Taxation Rules, 2011.
(2) They shall come into force on the 1st day
of April, 2011.
2.
Definitions.-
In these rules,
unless the context otherwise requires,-
(a) "Act" means the Finance Act, 1994 (32 of
1994);
1 [(b) *
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2 [(ba) "change in effective rate
of tax" shall include a change in the portion of value on which tax is payable
in terms of a notification issued in the Official Gazette under the provisions
of the Act, or rules made thereunder;]
(c) "continuous supply of service" means any
service which is provided, 3[or to be provided continuously or on
recurrent basis, under a contract, for a period exceeding three months with the
obligation for payment periodically or from time to time], or where the Central
Government, by a notification in the Official Gazette, prescribes provision of
a particular service to be a continuous supply of service, whether or not
subject to any condition;
(d) "invoice" means the invoice referred to in
rule 4A of the Service Tax Rules, 1994 and shall include any document as
referred to in the said rule;
(e) "point of taxation" means the point in time
when a service shall be deemed to have been provided;
4 [(f) *
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* ]
5 [ 2A. Date of payment.-For the purposes of these rules, "date of payment" shall be the earlier
of the
dates on which the payment is entered
in the books of accounts or is credited to the bank account of the
person
liable
to pay tax: Provided that -
(A) the
date of payment shall be the date of credit in the bank account when -
(i) there
is a change in effective rate of tax or when a service is taxed for the first
time during the period between such entry in books of
accounts and its credit in the bank account; and
(ii) the credit in the bank account is after four
working days from the date when there is change in effective rate of tax or a service is taxed
for the first time; and
(iii) the payment is made by way of an instrument
which is credited to a bank account,
(B) if any rule requires determination of the
time or date of payment received, the expression "date of
payment" shall be construed to mean
such date on which the payment is received;]
RULE 3. 6[Determination of point of taxation.-For the
purposes of these rules, unless otherwise provided, 'point of taxation' shall
be,-
(a) the time when the invoice for the service 7[provided or agreed to be provided is
issued:]
1
Omitted (w.e.f. 1.7.2012) by Notification No. 37/2012-ST dated
20.06-2012.
2 Inserted
(w.e.f. 1.4.2012) by Notification No. 04/2012-ST dated 17.03.2012.
3 Substituted
(w.e.f.1.4.2012) by Notification No. 04/2012-ST dated 17.03.2012.
4 Omitted
(w.e.f. 1.7.2012) by Notification No. 37/2012-ST dated 20.06-2012.
5 Inserted
(w.e.f. 1.4.2012) by Notification No. 04/2012-ST dated 17.03.2012.
6 Substituted
(w.e.f.1-4-2011) by Notification No.25/2011-Service Tax., dated 31.3.2011.
7 Substituted
(w.e.f. 1.7.2012) by Notification No. 37/2012-ST dated 20.06-2012.
1[Provided that where the
invoice is not issued within the time period specified in rule 4A of the Service Tax Rules, 1994, the point of
taxation shall be date of such completion of provision of the service.]
(b) in a
case, where the person providing the service, receives a payment before the
time specified in clause (a), the time,
when he receives such payment, to the extent of such payment.
2[Provided that
for the purposes of clauses (a) and (b),-
(i)
in case of continuous supply of service where the
provision of the whole or part of the service is determined periodically on the
completion of an event in terms of a contract, which requires the receiver of
service to make any payment to the service provider, the date of completion of
provision of service;
(ii)
wherever the provider of taxable service receives a
payment up to rupees one thousand in excess of the amount indicated in the
invoice, the point of taxation to the extent of such excess amount, at the option
of the provider of taxable service, shall be determined in accordance with the
provisions of clause (a).]
Explanation .- For the
purpose of this rule, wherever any advance by whatever name known, is received
by the service provider towards the provision of taxable service, the point of
taxation shall be the date of receipt of each such advance.].
4. Determination of point of taxation in case
of 3[change in effective rate of tax]. - Notwithstanding anything
contained in rule 3, the point of taxation in cases where there is a 4[change
in effective rate of tax] in respect of a service, shall be determined in the
following manner, namely:-
(a) in case a taxable service has been provided
before the 5[change in effective rate of tax],-
(i) where the invoice for the same has been
issued and the payment received after the 6[change in effective rate
of tax], the point of taxation shall be
date of payment or issuing of invoice, whichever is earlier; or
(ii) where the invoice has also been issued prior
to 7[change in effective rate of
tax] but the payment is received after the 8[change in
effective rate of tax], the point of
taxation shall be the date of issuing of invoice; or
(iii) where the payment is also received before the
9[change in effective rate of
tax], but the invoice for the same has been issued after the 10[change
in effective rate of tax], the point of
taxation shall be the date of payment;
(b) in case a taxable service has been provided
after the 11[change in effective rate of tax],-
(i) where the payment for the invoice is also
made after the 12[change in effective rate of tax] but the invoice has been issued prior to
the 13[change in effective rate of
tax], the point of taxation shall be the date of payment; or
(ii) where the invoice has been
issued and the payment for the invoice received before the 14[change
in effective rate of tax], the point of
taxation shall be the date of receipt of payment or date of issuance of
invoice, whichever is earlier; or
(iii) where the invoice has also
been raised after the 15[change in effective rate of tax]
but the payment has been received before the 16[change in
effective rate of tax], the point of
taxation shall be date of issuing of invoice.
1.
Substituted
(w.e.f.1-4-2012)by Notification No.4/2012-S.T., dated 17-3-2012.
2.
Substituted
(w.e.f.1-4-2012)by Notification No.4/2012-S.T., dated 17-3-2012.
3.
Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
4.
Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
5.
Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
6.
Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
7.
Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
8.
Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
9.
Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
10. Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
11. Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
12. Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
13. Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
14. Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
15. Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011.
16. Substituted
(w.e.f.1-4-2011)by Notification No.25/2011-S.T., dated 31-3-2011
1[* *
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RULE 2[5. Payment
of tax in case of new services.-
Where a service
is taxed for the first time, then,-
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(a)
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no tax shall be payable to the
extent the invoice has been issued and the payment received
against such invoice before such service became taxable;
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(b)
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no tax shall be payable if the
payment has been received before the service becomes taxable and invoice
has been issued within fourteen days of the date when the service is taxed
for the first time.]
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RULE 3[6. * *
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RULE 4[7. Determination of point of taxation in case of specified services
or persons.--
Notwithstanding
anything contained in these rules, the point of taxation in respect of the
persons required to pay tax as recipients of service under the rules made in
this regard in respect of services notified under sub-section (2) of section 68
of the Act, shall be the date on which payment is made :
Provided that, where the payment is not made within a period of six
months of the date of invoice, the point
of taxation shall be determined as if this rule does not exist:
Provided further that in
case of "associated enterprises", where the person providing the service is
located outside India, that point of taxation shall be the date of debit in the
books of account of the person receiving the service or date of making the
payment whichever is earlier.]
8. Determination of
point of taxation in case of copyrights, etc. .- In respect of royalties and
payments pertaining to copyrights, trademarks, designs or patents, where the
whole amount of the consideration for the provision of service is not
ascertainable at the time when service was performed, and subsequently the use
or the benefit of these services by a person other than the provider gives rise
to any payment of consideration, the service shall be treated as having been
provided each time when a payment in respect of such use or the benefit is
received by the provider in respect thereof, or an invoice is issued by the
provider, whichever is earlier.
RULE 5[8A. Determination of point of taxation in other
cases.-Where the point of taxation cannot be determined as per these rules as
the date of invoice or the date of payment or both are not available, the
Central Excise officer, may, require the concerned person to produce such
accounts, documents or other evidence as he may deem necessary and after taking
into account such material and the effective rate of tax prevalent at different
points of time, shall, by an order in writing, after giving an opportunity of
being heard, determine the point of taxation to the best of his judgement.]
RULE 6[9. Transitional Provisions. - Nothing contained in 7[these
rules] shall be applicable,-
(i)
Where
the provision of service is completed; or
(ii)
Where
invoices are issued
Prior to the date on which thses
rules come into force.
Provided that services for which
provision are completed on or before 30th day of June, 2011 or where
the invoices are issued up to the 30th day of June, 2011, the point
of taxation shall, at the option of the taxpayer, be the date on which the
payment is received or made as the case may be.].
1.
Omitted
(w.e.f.1-4-2012) by Notification No.4/2012-Service Tax., dated 17-3-2012.
2.
Substituted
(w.e.f.1-4-2012) by Notification No.4/2012-Service Tax., dated 17-3-2012.
3.
Omitted
(w.e.f.1-4-2012) by Notification No.4/2012-Service Tax., dated 17-3-2012.
4.
Substituted
(w.e.f.1-4-2012) by Notification No.4/2012-Service Tax., dated 17-3-2012.
5.
Inserted
(w.e.f.1-4-2012) by Notification No.4/2012-Service Tax., dated 17-3-2012.
6.
Substituted
(w.e.f.1-4-2011) by Notification No.25/2011-S.T., dated 31-3-2011.
7.
Corrected
by M.F.(D.R.) Corrigendum F.No.334/3/2011-TRU, dated 4-4-2011.
Commercial or Industrial construction service,
construction of residential complex service, Telecommunications services,
internet telecommunication services and works contract service be treated as
continuous supply service for the purpose of Point of Taxation Rules, 2011. -In
exercise of the powers conferred under clause (a) and clause (hhh) of
sub-section (2) of section 94 of the Finance Act, 1994 (32 of 1994)
(hereinafter referred to as the Finance Act), read with clause (c) of rule (2)
of the Point of Taxation Rules, 2011 (hereinafter referred to as the said
rules), the Central Government hereby notifies that the provision of taxable
services 1[of telecommunication service and service portion in
execution of a works contract]n shall be treated as continuous supply of
service, for the purpose of the said rules.
[Notification No.28/2011-S.T. ,
dated 1-4-2011 as amended by Notification No.38/2012-S.T., dated 20-6-2012.]
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