The Point of Taxation rules, 2011 has been amended expanding the scope of services which are allowed to pay service tax on reciept basis, to the consulting engineers services.
In the rule 7(c) of the said rules clause (g) has also been added which relates to the "taxable services provided or to be provided to any person, by a consulting engineer in relation to advice, consultancy or technical assistance in any manner in one or more disciplines of engineering including the discipline of computer hardware engineering."
Full notification in this regard is produced herebelow:
Notification No. 41/2011-ST., Dated: June 27, 2011
In exercise of the powers conferred by clause (a) and clause (hhh) of sub-section (2) of section 94 of the Finance Act, 1994 (32 of 1994), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby makes the following rules further to amend the Point of Taxation Rules, 2011, namely:-1. (1) These rules may be called the Point of Taxation (Second Amendment) Rules, 2011.
(2) They shall come into force on the 1 st day of July, 2011.
2. In the Point of Taxation Rules, 2011, in Rule 7, in sub-rule (c),-
before the bracket and letter “ (p)”, the bracket and letter “(g)” shall be inserted,
[F. No. 334/3/2011-TRU]
( Samar Nanda )
Under Secretary to the Government of India
Note .- The principal rules were notified vide notification no. 18/2011-Service Tax, dated the 1 st March, 2011, published in the Gazette of India, Extraordinary vide Number G.S.R. 175(E), dated the 1 st March, 2011 and last amended vide notification No.25/2011-Service Tax, dated the 31 st March, 2011, published on the Gazette of India vide Number G.S.R. 283(E), dated the 31 st March, 2011.Under Secretary to the Government of India
Rule 7 of Point of Taxation Rules, 2011 is also produced herebelow for ready reference and better understanding:
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,-
(a) the services covered by sub-rule (1) of rule 3 of Export of Services Rules, 2005;
(b) the persons required to pay tax as recipients under the rules made in this regard in respect of services notified under sub-section (2) of section 68 of the Finance Act, 1994;
(c) individuals or proprietary firms or partnership firms providing taxable services referred to in sub-clauses (p), (q), (s), (t), (u), (za), (zzzzm) of clause (105) of section 65 of the Finance Act, 1994, shall be the date on which payment is received or made, as the case may be:
Provided that in case of services referred to in clause (a), where payment is not received within the period specified by the Reserve Bank of India, the point of taxation shall be determined, as if this rule does not exist.
Provided further that in case of services referred to in clause (b) 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 also that in case of “associated enterprises”, where the person providing the service is located outside India, the point of taxation shall be the date of credit in the books of account of the person receiving the service or date of making the payment whichever is earlier.
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