1. Union Budget 2014-2015 Select Service Tax Amendments S B GABHAWALLA & CO CHARTERED ACCOUNTANTS

2. Status Quo of Provisions or of Ill-Placed Amendments? Negative List Exemptions Valuation and Abatements Place of Provision of Service Rules Special Economic Zones

3. Negative List & Exemptions Gain Some ~ Loose Some Transport, loading, unloading, packing or storage of cotton Transport of organic manure Treatment or disposal of biomedical waste Specialized financial services imported by RBI Foreign tours to a foreign tourist Life Micro Insurance Scheme if sum assured up to Rs. 50,000/- Sale of space or time for advertisement other than print media Transportation by radio taxis whether air-conditioned or not Transportation by air-conditioned contract carriages Testing on human participants for clinical trials

4. Services to Government Confusion Galore Services provided to Government, a local authority or a governmental authority by way of— (a) carrying out any activity in relation to any function ordinarily entrusted to a municipality in relation to water supply, public health, sanitation conservancy, solid waste management or slum improvement and upgradation

5. Services by Educational Institutions Hip Hip Hurrah!! Earlier Negative List Entry Preschool & Secondary Education Recognised Education Vocational Education Now Negative List Entry Continues as it is, but used for defining educational institution Exemption Entry Services provided by an educational institution to its’ students, faculty or staff

6. Services to Educational Institutions More Clarity at the Cost of Taxation Transportation of students, faculty and staff Catering including mid-day meal schemes Security, cleaning or house-keeping services Services relating to admission and conduct of examination Auxiliary educational services no longer exempted Renting to educational institutions no longer exempted

7. Valuation Who Realizes the Value of Useless Litigation? DescriptionCurrent Taxable Component New Taxable Component Original Works40% Works Contract relating to Immovable Property 60%70% Other Works Contract70% Coastal Transportation50%40% Transport by Radio TaxisNA40%

8. Valuation : Exchange Rate Dependent Legislation Exchange Rate for Foreign Currency Transactions as per the generally accepted accounting principles on the date of point of taxation Does it really eliminate reconciliation? What if the accounting is at variation with GAAP?

9. Place of Provision of Service Rules In Stark Conflict with GST Principles Intermediary services in relation to goods also covered by provider based criteria Import of goods for repairs and re-export exempt only if the repaired goods not put to use in India Hiring of transport vehicles governed by General Rule

10. Procedural Aspects More Onus on the Assessee Incremental interest rates of 18%/24%/30% depending on delay in payment of tax Concession of 3% for small service providers continues Discretion for waiver of penalty in cases of suppression removed.

11. Procedural Aspects More Teeth to the Department Power of seizure of books and documents Power to recover dues from successor or purchaser of business Power to impose restrictions on claim of credit in specific cases

12. Some Benefits Whether Really Useful? Amendment in SEZ notification Form A2 to be issued by the Department within 15 days or deemed to be issued Form A2 to be applied by the Assesse within 15 days or the benefit available only from the date of application Adjudication to be completed within 6/12 months from the date of notice, as far as possible

13. Thank You