Latest Expert Exchange Queries

GST Demo Service software link: https://ims.go2customer.com
Username: demouser Password: demopass
Get your inventory and invoicing software GST Ready from Binarysoft info@binarysoft.com
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
 
 
 
 
Popular Search: ARTICLES ON INPUT TAX CREDIT IN VAT :: VAT Audit :: TDS :: Central Excise rule to resale the machines to a new company :: articles on VAT and GST in India :: ACCOUNTING STANDARD :: cpt :: due date for vat payment :: TAX RATES - GOODS TAXABLE @ 4% :: list of goods taxed at 4% :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT RATES :: ACCOUNTING STANDARDS :: empanelment :: form 3cd
 
 
« Service Tax »
 Further clarification to Circular No. 1/2017 - GST dated 21st July, 2017.
 GST Return Filing: How to handle discounts and additional cost
 GST base looks set to be at least 25% wider than earlier tax regime
 Businesses struggle with multiple tax rates, returns
 Common use items exempt from e-way bill provision under GST
 Goods And Services Tax Sends Taxes Racing
 How GST lesson can unleash untapped potential of education sector in India
 Services sector PMI falls most in 4 years on GST
 Missing column in GSTR 3B form leaves input claims a shaky edifice
  Communication to the Central Excise/Service Tax Taxpayers on migration to GST
 GST not easy to implement but tax base expansion will benefit all

Service tax on toll: IRB Infra moves Highways Ministry
September, 17th 2012

Anticipating a Rs 600-crore notice from the Service Tax Department, IRB Infrastructure has moved the Highways Ministry. It has sought a clarification on the issue of levying service tax on highway toll revenues.

Mumbais service tax commissioner has asked IRB Infrastructure the company developing over 6,400 km of highways to pay service tax on its total toll revenues over a five-year period.

IRB, one of the top five highway developers by length, recently received a notice of Rs 60 crore for three of its special purpose vehicles (SPVs) that operate highways. It is likely to get a notice for another Rs 230 crore for the remaining seven operational SPVs, Virendra D. Mhaiskar, Chairman and Managing Director, IRB Infrastructure Developers, said.

Taking into account the penalty of an amount equivalent to the notice, the total service tax demand is likely to touch Rs 600 crore, said Mhaiskar. The tax has been levied at the rate of about 10-12 per cent on entire toll receivables of the three SPVs. Such an outgo from our toll collections will render all projects completely unviable, he added.

Remedial action

IRB has approached the Highways Ministry and National Highways Authority of India, and will also lodge an appeal with the Service Tax Tribunal.

Incidentally, the Finance Ministry had clarified on February 22, 2012, saying that highway toll revenues being collected by SPVs or concessionaires of NHAI would not attract service tax if the tolls were being collected by the SPV itself. In fact, this activity also forms a part of the negative list on service tax.

Moreover, even if the SPVs of highway developers employ companies to collect toll, then the service is applicable on the expenditure or cost towards the activity of toll collection and not the entire toll collection itself, Mhaiskar said.

Many concessionaires, including Larsen and Toubro and IL&FS Transportation Ltd, sub-contract the collection of toll. They spend about one per cent of their total revenues on toll collection activity.

In the worst-case scenario, IRB says it can ask NHAI to compensate it under the change of law clause in the concession agreement. The clause says that if the developer has to take additional expenditure on account of change in law or in interpretation of law after the project has started, then the authority will have to compensate the concessionaire/BOT developer. The concessionaires SPVs operate the project for 15-30 years.

At close of trading hours today, the IRB Infrastructure stock was up 4.67 per cent at Rs 132.25 on the BSE.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Content Management System development CMS development Content Management Solutions CMS Solutions Content Management Services CMS Services CMS Software

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions