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Seeks to exempt the following taxable services from the whole of the service tax
March, 23rd 2012



Government of India
Ministry of Finance
Department of Revenue


Notification No.12/2012-Service Tax

New Delhi, the 17th March 2012



            G.S.R.    (E).- In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the said Finance Act), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the following taxable services  from the whole of the service tax leviable thereon under section 66 B of the said Finance Act, namely:-


1.     Services provided to the United Nations or a specified international organization;

2.     Health care services by a clinical establishment, an authorised medical practitioner or para-medics;

3.     Services by a veterinary clinic in relation to health care of animals or birds;

4.     Services by an entity registered under section 12AA of the Income tax Act, 1961 (43 of 1961) by way of charitable activities;

5.     Services by a person by way of-

(a)   renting of precincts of a religious place meant for general public; or

(b)   conduct of  any religious ceremony;

6.     Services provided to any person other than a business entity by -

(a)   an individual as an advocate; or

(b)   a person represented on and as arbitral tribunals;

7.     Services by way of technical testing or analysis of newly developed drugs, including vaccines and herbal remedies, on human participants by a clinical research organisation approved to conduct clinical trials by the Drug Controller General of India;

8.     Services by way of training or coaching in recreational activities relating to arts, culture or sports;

9.     Services provided-

(a)   to an educational institution by way of catering under any  centrally assisted mid day meals scheme sponsored by Government;

(b)   to or by an institution in relation to educational services, where the educational services are exempt from the levy of service tax, by way of transportation of students or staff;

(c)   to or by an institution in relation to educational services, where the educational services are exempt from the levy of service tax, by way of  services in relation to admission to such education;

10. Services provided to a recognised sports body by-

(a)   an individual as a player, referee, umpire, coach or manager for participation in a  tournament or championship organized by a recognized sports body;

(b)   another recognised sports body;

11.  Services by way of sponsorship of tournaments or championships organised,-

(a)   by a national sports federation, or its affiliated federations, where the participating teams or individuals represent any district, state or zone;

(b)   by Association of Indian Universities, Inter-University Sports Board, School Games Federation of India, All India Sports Council for the Deaf,Paralympic Committee of India, Special Olympics Bharat;

(c)   by Central Civil Services Cultural and Sports Board;

(d)   as part of national games, by Indian Olympic Association; or

(e)   under Panchayat Yuva Kreeda Aur Khel Abhiyaan (PYKKA) Scheme;

12. Services provided to the Government or local authority by way of erection, construction, maintenance, repair, alteration, renovation or restoration of -

(a)   a civil structure or  any other original works meant predominantly for a non-industrial or non-commercial use;

(b)   a historical monument, archaeological site or remains of national importance, archaeological excavation, or antiquity specified under Ancient Monuments and Archaeological Sites and Remains Act, 1958 (24 of 1958);

(c)    a structure meant predominantly for use  as (i) an educational, (ii) a clinical, or  (iii) an art or cultural establishment; 

(d)   canal, dam or other irrigation works;

(e)   pipeline, conduit or plant for (i) drinking water supply (ii) water treatment  (iii)sewerage treatment or disposal; or

(f)    a residential complex predominantly meant for self-use or the use of their employees or other persons specified in the Explanation 1 to clause 44 of section 65 B of the said Finance Act;

13.  Services provided by way of erection, construction, maintenance, repair, alteration, renovation or restoration of,-

(a)   road, bridge, tunnel, or terminal for road transportation for use by general public;

(b)   building owned by an entity registered under section 12 AA of the Income tax Act, 1961(43 of 1961) and meant predominantly for religious use by general public;

(c)   pollution control or effluent treatment plant, except located as a part of a factory; or

(d)   electric crematorium;

14. Services by way of erection or construction of original works pertaining to,-

(a)   airport, port or railways;

(b)   single residential unit otherwise as a part of a residential complex;

(c)   low- cost houses up to a carpet area of 60 square metres per house in a housing project approved by competent authority empowered under the Scheme of Affordable Housing in Partnership framed by the Ministry of Housing and Urban Poverty Alleviation, Government of India;

(d)   post- harvest storage infrastructure for agricultural produce including a cold storages for such purposes; or

(e)   mechanised food grain handling system, machinery or equipment for units  processing  agricultural produce as food stuff excluding alcoholic beverages;

15. Temporary transfer or permitting the use or enjoyment of a copyright covered under clause (a) or (b) of sub-section (1) of section 13 of the Indian Copyright Act, 1957 (14 of 1957), relating to original literary, dramatic, musical, artistic works or cinematograph films;

16. Services by a performing artist in folk or classical art forms of (i) music, or (ii) dance, or (iii) theatre, excluding services provided by such artist as a brand ambassador;

17.  Services by way of collecting or providing news by an independent journalist, Press Trust of India or United News of India;

18. Services by way of renting of a hotel, inn, guest house, club, campsite or other commercial places meant for residential or lodging purposes, having declared tariff of a room below rupees one thousand per day or equivalent;

19. Services provided in relation to serving of food or beverages by a restaurant, eating joint or a  mess, other than those having the facility of air-conditioning or central air-heating in any part of the establishment, at any time during the year, and which has a licence to serve alcoholic beverages;

20. Services by way of transportation by rail or a vessel from one port in India to another  of the following goods -

(a)   petroleum and petroleum products falling under Chapter heading 2710 and  2711 of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986);

(b)   relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap;

(c)   defence  or military equipments;

(d)   postal mail, mail bags or household effects;

(e)   newspaper or magazines registered with Registrar of Newspapers;

(f)    railway equipments or materials;

(g)   agricultural produce;

(h)   foodstuff including flours, tea, coffee, jaggery, sugar, milk products, salt and edible oil, excluding alcoholic beverages; or

(i)     chemical fertilizer and oilcakes;

21. Services provided by a goods transport agency by way of transportation of -

(a)   fruits, vegetables, eggs, milk, food grains or pulses in a goods carriage;

(b)   goods where gross amount charged on a consignment transported in a single goods carriage does not exceed one thousand five hundred rupees; or

(c)   goods, where gross amount charged for transportation of all such goods for a single consignee in the goods carriage does not exceed rupees seven hundred fifty;

22. Services by way of giving on hire -

(a)   to a state transport undertaking, a motor vehicle meant to carry more than twelve passengers; or

(b)   to a goods transport agency, a means of transportation of goods;

23. Transport of passengers, with or without accompanied belongings, by -

(a)   air, embarking or terminating in an airport located in the state of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, or Tripura or at Baghdogra located in West Bengal; or

(b)   a  contract carriage for the transportation of passengers, excluding tourism, conducted tour, charter or hire;

24. Services by way of motor vehicle parking to general public excluding leasing of space to an entity for providing such parking facility;

25. Services provided to the Government or a local authority by way of -

(a)   repair of a ship, boat or vessel;

(b)   effluents and sewerage treatment;

(c)   waste collection or disposal;

(d)   storage, treatment or testing of water for drinking purposes; or

(e)   transport of water by pipeline or conduit for drinking purposes;

26. Services of general insurance business provided under following schemes -

(a)   Hut Insurance Scheme;

(b)   Cattle Insurance under Swarnajaynti Gram Swarozgar Yojna (earlier known as Integrated Rural Development  Programme);

(c)   Scheme for Insurance of Tribals;

(d)   Janata Personal Accident Policy and Gramin Accident Policy;

(e)   Group Personal Accident Policy for Self-Employed Women;

(f)    Agricultural Pumpset and Failed Well Insurance;

(g)   premia collected on export credit insurance;

(h)   Weather Based Crop Insurance Scheme or the Modified National Agricultural Insurance Scheme, approved by the Government of India and implemented by the Ministry of Agriculture;

(i)     Jan Arogya Bima Policy;

(j)     National Agricultural Insurance Scheme (Rashtriya Krishi Bima Yojana);

(k)    Pilot Scheme on Seed Crop Insurance;

(l)     Central Sector Scheme on Cattle Insurance;

(m)  Universal Health Insurance Scheme;

(n)   Rashtriya Swasthya Bima Yojana; or

(o)   Coconut Palm Insurance Scheme;

27. Services provided by an incubatee up to a total business turnover of fifty lakh rupees in a financial year subject to the following conditions, namely:-

(a)   the total business turnover had not exceeded fifty lakh rupees during the preceding financial year; and

(b)   a period of three years has not lapsed  from the date of entering  into an agreement as an incubatee;

28. Service by an unincorporated body or an entity registered as a society to own members by way of reimbursement of charges or share of contribution -

(a)   as a trade union;

(b)   for the provision of exempt services by the entity to third persons; or

(c)   up to an amount of five thousand rupees per month per member for sourcing of goods or services from a third person for the common use of its members in a housing society or a residential complex;

29. Services by the following persons in respective capacities -

(a)   a sub-broker or an authorised person to a stock broker;

(b)   an authorised person to a member of a commodity exchange;

(c)   a mutual fund agent or distributor to mutual fund or asset management company for distribution or marketing of mutual fund;

(d)   a selling or marketing agent of lottery tickets to a distributer or a selling agent;

(e)   a selling agent or a distributer of SIM cards or recharge coupon vouchers; or

(f)    a business facilitator or a business correspondent to a banking company or an insurance company in a rural area;

30. Carrying out an intermediate production process as job work in relation to -

(a)   agriculture, printing or textile processing;

(b)   cut and polished diamonds and gemstones; or plain and studded jewellery of gold and other precious metals, falling under Chapter 71 of the Central Excise Tariff Act ,1985 (5 of 1986);

(c)   any goods on which appropriate duty is payable by the principal manufacturer; or

(d)   processes of electroplating, zinc plating, anodizing, heat treatment, powder coating, painting including spray painting or auto black, during the course of manufacture of  parts of  cycles or sewing machines upto an aggregate value of taxable service of the specified processes of  one hundred and fifty lakh rupees in a financial year subject to the condition that such  aggregate value had not exceeded  one hundred and fifty lakh rupees during the preceding financial year;

31. Services by an organiser to any person in respect of a business exhibition held outside India;

32. Services by way of making telephone calls from -

(a)   departmentally run public telephones;

(b)   guaranteed public telephones operating only for local calls; or

(c)   free telephone at airport and hospitals where no bills are being issued;

33. Services by way of slaughtering of bovine animals;

34. Services received from a service provider located in a non- taxable territory by -

(a)   the Government, a local authority or an individual in  relation to any purpose other than industry, business or commerce; or

(b)   an entity registered under section 12AA of the Income tax Act, 1961 (43 of 1961) for the purposes of providing charitable activities.


2.     Definitions. - for the purpose of this notification, unless the context otherwise requires,

1.     advocate has the meaning assigned to it in clause (a) of sub-section (1) of section 2 of the Advocates Act, 1961 ( 25 of 1961),

2.     appropriate duty means duty payable on manufacture or production under a Central or a State Act, but shall not include Nil rate of duty or duty wholly exempt,

3.      arbitral tribunal has the meaning assigned to it in clause (d) of section 2 of the Arbitration and Conciliation Act, 1996 (26 of 1996),

4.      authorised medical practitioner means any medical practitioner registered with any of  the  Councils of the recognised system of medicine and includes medical professional having the requisite qualification to practice in any recognised system of medicine as per any law for the time being in force,

5.      "authorised person means and includes any person whether being an individual, partnership firm, limited liability partnership or body corporate, who is appointed as such either by a stock broker including trading member or by a member of commodity exchange and who provides access to trading platform of a stock exchange or a commodity exchange, as an agent of the stock broker or member of a commodity exchange,

6.     banking company has the meaning assigned to it in clause (a) of section 45A of the Reserve Bank of India Act,1934(2 of 1934),

7.     business facilitator or business correspondent means an intermediary appointed under business facilitator model or business correspondent model by a banking company or an insurance company under the guidelines issued by Reserve Bank of India,

8.     "clinical establishment" means a hospital, nursing home, clinic, sanatorium or an institution by, whatever name called, that offers services or facilities requiring diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognised system of medicine, established and administered or maintained by any person or a place established as an independent entity or a part of an establishment to carry out diagnostic or investigative services of diseases,

9. charitable activities means activities relating to -

(a)   public health by way of -

(I)     care or counseling of (i) terminally ill persons or persons with  severe physical or mental disability, (ii) persons afflicted with HIV or AIDS, or (iii) persons addicted to a dependence-forming substance such as narcotics drugs or alcohol; or

(II)    public awareness of preventive health, family planning or  prevention of HIV infection;

(b)   advancement of religion;

(c)   advancement of educational programmes or skill development relating to,-

(I)     abandoned, orphaned or homeless children;

(II)    physically or mentally abused and traumatized persons;

(III)   prisoners; or

(IV)  persons over the age of 65 years residing in a rural area; 

(d)   preservation of environment including watershed, forests and wildlife; or

(e)   advancement of any other object of general public utility up to a  value of twenty five lakh rupees in a financial year subject to the condition that total value of such activities had not exceeded twenty five lakhs rupees during the preceding financial year.

Explanation: - For the purpose of this clause, general public means the body of people at large sufficiently defined by some common quality of public or impersonal nature.

 10. commodity exchange means an association as defined in section 2 (j) and recognized under section 6 of the Forward Contracts (Regulation) Act,1952 (74 of 1952),

11. contract carriage has the meaning assigned to it in clause (7) of section 2 of the Motor Vehicles Act, 1988 (59 of 1988),

12. declared tariff includes charges for all amenities provided in the unit of accommodation (given on rent for stay) like furniture, air-conditioner, refrigerators or any other amenities, but does not include any discount offered on the published charges for such unit,

13. distributor or selling agent has the meaning assigned to them in clause (c) of the rule 2 of the Lottery (Regulation) Rules, 2010 notified by the Government of India in the Ministry of Home Affairs published in the Gazette of India, Extraordinary, Part-II, Section 3, Sub-section (i), vide number G.S.R. 278(E), dated the 1st April, 2010 and shall include distributor or selling agent authorised by the lottery organising State,

14. "general insurance business" has the meaning assigned to it in clause (g) of section 3 of General Insurance Business (Nationalisation) Act, 1972 (57 of 1972),

15. goods carriage has the meaning assigned to it in clause (14) of section 2 of the Motor  Vehicles Act, 1988 (59 of 1988), care services means any service by way of  diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognised system of medicine and includes services by way of supply of meals for the patient or transportation of the patient to and from a clinical establishment, but does not include hair transplant or cosmetic or plastic surgery, except when undertaken to restore or to reconstruct anatomy or functions of body affected due to congenital defects, developmental abnormalities, injury or trauma,

17.incubatee means an entrepreneur located within the premises of a Technology Business Incubator (TBI) or Science and Technology Entrepreneurship Park (STEP) recognised by the National Science and Technology Entrepreneurship Development Board (NSTEDB) of the Department of Science and Technology, Government of India and who has entered into an agreement with the TBI or the STEP to enable himself to develop and produce hi-tech and innovative products, company means  a company carrying on life insurance business or general insurance business, insurance business has the meaning assigned to it in clause (11) of section 2 of the Insurance  Act, 1938 (4 of 1938),

20. original works means -

(a)   all new constructions; or

(b)   all types of additions and alterations to abandoned or damaged structures on land that are required to make them workable,

21. principal manufacturer means any person who gets goods manufactured or processed on  his account from another person,

22. recognized sports body means (i) the Indian Olympic Association, (ii) Sports Authority of India, (iii) a national sports federation recognised by the Ministry of Sports and Youth Affairs of the Central Government, and its affiliate federations, (iv) national sports promotion organisations recognisedby the Ministry of Sports and Youth Affairs of the Central Government, (v) the International Olympic Association or a federation  recognised by the International Olympic Association or (vi) a federation or a body which regulates a sport at international level,

23. religious place means a place which is primarily meant for conduct of prayers or worship pertaining to a religion,

24. residential complex means any complex comprising of a building or buildings, having more than one single residential unit,

25.rural area means the area comprised in a village as defined in land revenue records, excluding,-

(i)     the area under any municipal committee, municipal corporation, town area committee, cantonment board or notified area committee; or

(ii)    any area that may be notified as an urban area by the Central Government or a State Government,

26. single residential unit means an independent residential unit with specific facilities for living, cooking and sanitary requirements,

27. "specified international organisation" means an international organisation declared by the Central Government in pursuance of section 3 of the United Nations (Privileges and Immunities) Act, 1947 (46 of 1947), to which the provisions of the Schedule to the said Act apply,

28. "state transport undertaking" has the meaning assigned to it in clause (42) of Section 2 of the Motor Vehicles Act, 1988 (59 of 1988),

29. "sub-broker" has the meaning assigned to it in sub-clause (gc) of clause 2 of the Securities and Exchange Board of India (Stock Brokers and Sub-brokers) (Second Amendment) Regulations, 2006, union has the meaning assigned to it in clause (h) of section 2 of the Trade Unions Act,1926(16 of 1926).


3. This notification shall come into force from the date on which section 66B of the Finance Act, 1994 comes into effect.



[F. No. 334/1/2012-TRU]

(Samar Nanda)
Under Secretary to the Government



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