DREDGING
Date of Introduction: 16.06.2005 vide Notification NO.15/2005
dated 07.06.2005
Definitions:
“dredging” includes removal of material including, silt, sediments,
rocks, sand, refuse, debris, plant or animal matter in any excavating, cleaning,
deepening, widening or lengthening, either permanently or temporarily, of any
river, port, harbour, backwater or estuary; (section 65(36a))
“taxable
service” means any service provided or to be provided to any person, by any
other person, in relation to dredging;; (section 65(105)(zzzb))
Value of Taxable Service:
The value of taxable service shall be the gross amount charged by the
service provider for providing such service and the money value of any other
consideration ( if any) received for providing such service. The value of
taxable service shall be determined as per the provisions made under section 67
of the Finance Act, read with Service Tax (Determination of Value ) Rules, 2006
Who is responsible to pay Service Tax:
The service provider is responsible to pay service tax. However, in
cases, where the provider of taxable service is located outside India and the
recipient of service is located in India, the recipient of service is
responsible for payment of service tax. The responsibility to pay service tax
under such situations is determined by the provisions made under section 66A of
the Finance Act, 1994, read with Taxation of Services (Provided from outside
India and received in India) Rules, 2006
Scope of Service:
Any service provided or to be provided to any person, by any other
person, in relation to dredging is leviable to service tax under sub-clause
(zzzb) of section 65(105) of the Finance Act, 1994. ‘Dredging’ has been defined
under clause (36a) of section 65 of the Finance Act, 1994.
This taxable
service covers dredging which is generally undertaken for removal of material
such as silt, sediments, rocks etc. of rivers, ports, harbour, backwater or
estuary for providing adequate draught for ships and other vessels and to
maintain shipping channels. Service tax is leviable only on dredging of river,
port, harbour, backwater or estuary and dredging in any other cases does not
attract service tax. The definition of dredging is an inclusive definition and
the activities specified are only indicative and not exhaustive. (Ref: Board’s
Circular No. F.No.B1/ 6 /2005-TRU dated 27.07.2005).
General Exemptions:
|
Sr.No. |
Notification No. |
Nature of exemption |
|
1 |
16/2002 |
Services provided to United nations or any International Organisation |
|
2 |
12/2003 |
Exemption to value of goods and material sold during the course of providing taxable service, subject to conditions laid down in the notification. |
|
3 |
4/2004 |
Service provided to a developer of Special Economic Zone or Unit located in SEZ |
|
4 |
6/2005 |
Exemption from service tax for taxable services upto gross value of Rs. 4 lakhs, in case of service providers whose gross turnover for the preceding financial year was less than Rs. 4 lakhs ( w.e.f 01.04.2005) |