EXTRACT OF THE FINANCE ACT, 2017
NO. 7 OF 2017
[31st March, 2017.]
A n Act to give effect to the financial proposals of the Central Government for the financial year 2017-2018.
BE it enacted by Parliament in the Sixty-eighth Year of the Republic of India as follows:-
CHAPTER I
PRELIMINARY
1. (1) This Act may be called the Finance Act, 2017.
(2) Save as otherwise provided in this Act, sections 2 to 88 shall come into force on the
1st day of April, 2017.
CHAPTER V
SERVICE TAX
121. Amendment of section 65B.
In the Finance Act, 1994 (hereinafter referred to as the 1994 Act), in section 65B, clause (40) shall be omitted.
122. Amendment of section 66D.
In the 1994 Act, in section 66D, clause (f) shall be omitted.
123. Amendment of section 96A
In the 1994 Act, in section 96A, for clause (d), the following clause shall be substituted, namely:-
'(d) "Authority" means the Authority for Advance Rulings as defined in clause (e) of section 28E of the Customs Act, 1962;'
124. Omission of section 96B.
In the 1994 Act, section 96B shall be omitted.
125. Amendment of section 96C.
In the 1994 Act, in section 96C, in sub-section (3), for the words "two thousand and five hundred rupees" the words "ten thousand rupees" shall be substituted.
126. Amendment of section 96D.
In the 1994 Act, in section 96D, in sub-section (6), for the words "ninety days" the words "six months" shall be substituted.
127. Insertion of new section 96H
In the 1994 Act, after section 96H, the following section shall be inserted, namely:-
"96HA Transitional provision.
On and from the date on which the Finance Bill, 2017 receives the assent of the President, every application and proceeding pending before the erstwhile Authority for Advance Rulings (Central Excise, Customs and Service Tax) shall stand transferred to the Authority from the stage at which such application or proceeding stood as on the date of such assent."
128. Insertion of new sections 104 and 105.
In the 1994 Act, after section 103, the following sections shall be inserted, namely:-
"104 Special provision for exemption in certain cases relating to long term lease of industrial plots.
(1) Notwithstanding anything contained in section 66, as it stood prior to the 1st day of July, 2012, or in section 66B, no service tax, leviable on one time upfront amount (premium, salami, cost, price, development charge or by whatever name called) in respect of taxable service provided or agreed to be provided by a State Government industrial development corporation or undertaking to industrial units by way of grant of long term lease of thirty years or more of industrial plots, shall be levied or collected during the period commencing from the 1st day of June, 2007 and ending with the 21st day of September, 2016 (both days inclusive).
(2) Refund shall be made of all such service tax which has been collected, but which would not have been so collected, had sub-section (1) been in force at all material times.
(3) Notwithstanding anything contained in this Chapter, an application for claim of refund of service tax shall be made within a period of six months from the date on which the Finance Bill, 2017 receives the assent of the President.
105. Special provision for exemption in certain cases relating to life insurance services provided to members of armed forces of Union.
(1) Notwithstanding anything contained in section 66, as it stood prior to the 1st day of July, 2012, or in section 66B, no service tax shall be levied or collected in respect of taxable services provided or agreed to be provided by the Army, Naval and Air Force Group Insurance Funds by way of life insurance to members of the Army, Navy and Air Force, respectively, under the Group Insurance Schemes of the Central Government, during the period commencing from the 10th day of September, 2004 and ending with the 1st day of February, 2017 (both days inclusive).
(3) Notwithstanding anything contained in this Chapter, an application for the claim of refund of service tax shall be made within a period of six months from the date on which the Finance Bill, 2017 receives the assent of the President."
129. Amendment of rule 2A of Service Tax (Determination of Value) Rules, 2006, retrospectively.
(1) In the Service Tax (Determination of Value) Rules, 2006 made by the Central Government in exercise of the powers conferred by section 94 of the Finance Act, 1994 (32 of 1994), published in the Gazette of India vide notification of the Government of India in the Ministry of Finance (Department of Revenue) number G.S.R. 228(E), dated the 19th April, 2006,-
(a) rule 2A as inserted by the Service Tax (Determination of Value) (Amendment) Rules, 2007 published vide number G.S.R. 375(E), dated the 22nd May, 2007; and
(b) rule 2A as substituted by the Service Tax (Determination of Value) Second Amendment Rules, 2012 published vide number G.S.R. 431(E), dated the 6th June, 2012,
shall stand amended and shall be deemed to have been amended in the manner specified in column (3) of the Sixth Schedule, on and from and up to the corresponding date specified in column (4), against each of the rule specified in column (2) thereof.
(2) Notwithstanding anything contained in any judgment, decree or order of any court, tribunal or other authority, any action taken or anything done or purported to have been taken or done at any time during the period specified in column (4) of the Sixth Schedule relating to the provisions as amended by sub-section (1) shall be deemed to be and deemed always to have been, for all purposes, as validly and effectively taken or done as if the amendment made by sub-section (1) had been in force at all material times.
(3) For the purposes of sub-section (1), the Central Government shall have and shall be deemed to have the power to make rules with retrospective effect as if the Central Government had the power to make rules under section 94 of the Finance Act, 1994 (32 of 1994), retrospectively, at all material times.
Explanation.- the removal of doubts, it is hereby declared that no act or omission on the part of any person shall be punishable as an offence which would not have been so punishable had this section not come into force.
THE SIXTH SCHEDULE
(See section 129)
1
(i) the CENVAT Credit of duty paid on inputs or capital goods or the CENVAT Credit of service tax on input services, used for providing such taxable service, has not been taken under the provisions of the CENVAT Credit Rules, 2004;
(ii) the service provider has not availed the benefit under the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 12/ 2003-Service Tax, dated the 20th June, 2003 [G.S.R. 503(E), dated the 20th June, 2003].
Explanation.-For the purposes of this sub-rule, the gross amount charged shall include the value of goods and materials supplied or provided or used for providing the taxable service by the service provider.".
2
(I) in clause (i), after the words "value of property in goods" the words " in goods and land or undivided share of land, as the case may be," shall be inserted;
(a) the following proviso shall be inserted, namely:-
"Provied that where the amount charged for works contract includes the value of goods as well as land or undivided share of land, the service tax shall be payable on twenty-five per cent. of the total amount charged for the works contract."
provisos shall be substituted, namely:-
"Provided that where the amount charged for works contract includes the value of goods as well as land or undivided share of land, the service tax shall be payable on thirty per cent. of the total amount charged for the works contract:
Provided further that in case of works contract for construction of residential units having carpet area up to 2000 square feet or where the amount charged per residential unit from service recipient is less than rupees one crore and the amount charged for the works contract includes the value of goods as well as land or undivided share of land, the service tax shall be payable on twenty-five per cent. of the total amount charged for the works contract."
Provided further that in case of works contract for construction of residential units having carpet area up to 2000 square feet and where the amount charged per residential unit from service recipient is less than rupees one crore and the amount charged for the works contract includes the value of goods as well as land or undivided share of land, the service tax shall be payable on twenty-five per cent. of the total amount charged for the works contract."
shall be substituted, namely:-
"Provided that where the amount charged for works contract includes the value of goods as well as land or undivided share of land, the service tax shall be payable on thirty per cent. of the total amount charged for the works contract."