Wednesday, 25 December 2019

Unit 7: Collection and Recovery of Service Tax and Notes Assessment Procedure

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Unit 7: Collection and Recovery of Service Tax and Notes Assessment Procedure

The Centre had, in Budget 2011-12, announced a shift in the basis of collection of service tax from receipt basis to an accrual basis with effect from April 1.

The Finance Ministry’s decision to review this move comes in the wake of representations from many industry associations, who have suggested that status quo be maintained and service tax collections be continued on receipt basis.

The Finance Act of 1997 further extended the scope of service tax to cover a larger number of services rendered by the following service providers, from the dates indicated against each of them.

The unique feature of Service Tax is reliance on collection of tax, primarily through voluntary compliance.

Government has from the very beginning adopted a flexible approach concerning Service Tax administration so that the assessees and the general public gain faith and trust in the tax measure so that voluntary tax compliance, one of the avowed objectives of the Citizens Charter, is achieved.

Substantive and procedural liberalization measures, adopted over 124    Indirect Tax Laws Notes the years for this purpose, are clear manifestations of the above approach.

Following are some of the measures adopted in that direction:   Section 73D provides for publishing the name of any person and any other particulars relating to any proceedings under the provisions of Chapter V of the Finance Act, 1994, in relation to such person, in public interest, in such manner as may be prescribed.


Service tax: it is an indirect tax levied under the Finance Act, 1994, as amended from time to time, on specified services.

At present, there are approximately 96 categories (including 15 new services introduced by Budget 2006) of services taxable under the service tax net.

Self Assessment u/s 140A: This simply means that the person is calculating his own tax liability and thereafter filing ITR after payment of self-calculated tax.

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