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Budget 15-16 proposals: Amendments in sections 73, 76 and 78 (all related to penalty)Budget 15-16 proposals: Insertion of transition provision by way of section 78BBudget 15-16 proposals: Omitting section 80 (provided for waiver of penalty)Extending the scope of advance rulings to resident firms, with immediate effect (from 1.3.2015)Amendment in reverse charge mechanism, with immediate effect (from 1.4.2015)To prescribe full reverse charge on manpower supply and security service provided by individual, HUF, partnership firm to a body corporate, with immediate effect (from 1.4.2015)Prescribing reverse charge on service provided by a mutual fund agent, mutual fund distributor and agents of lottery distributor, with immediate effect (from 1.4.2015)Amendments in section 86 (remedy against the order passed by commissioner (Appeals) in a matter involving rebate of service tax shall lie in terms of section 35 EE of the Central Excise Act)Amendments in the provisions relating to Settlement CommissionShifting the liability of payment of service tax on aggregator of a service where service is provided under the brand name of the aggregator, with immediate effect (from 1.3.2015)Amendments in rules 4 (prescribing documentation, time limit and procedure for registration)Registration for single premises shall be granted within two days of filing the applicationProvisions for issuing digitally signed invoices and maintaining of records in electronic form added in rules 4A and 5 of the Service Tax Rules, 1994, with immediate effect (from 1.3.2015)The period for taking Cenvat Credit is being extended from six months from the date of invoice to one year from the date of invoice.Cenvat Credit allowed on input and capital goods received directly by job workers. ‘Export goods’ and ‘Exempt goods’ defined. New exemptions for,- (a) Precondition, pre-cooling, ripening, waxing, retail packing, labeling of fruits and vegetables (b) Service by a Common Effluent Treatment Plant operator (c) Varistha Bima Yojana (d) Ambulance services (e) Admission to a museum, zoo, national park, wild life sanctuary, and a tiger reserve (f) Service provided by exhibitor of movie to a distributor or an AOP consisting of exhibitor as one of its member (g)Transport of export goods by road from the place of removal to a laChange in abatement rates and conditions thereof for transport of passengers and goods by train; transport of goods by road by a GTA; transport of goods by vessels; executive/business class travel by air; and withdrawal of abatement on services provided in relation to chit, with immediate effect (from 1.4.2015) Amendment in reverse charge mechanism, with immediate effect (from 1.4.2015) To prescribe full reverse charge on manpower supply and security service provided by individual, HUF, partnership firm to a body corporate, with immediate effect (from 1.4.2015) Prescribing reverse charge on service provided by a mutual fund agent, mutual fund distributor and agents of lottery distributor, with immediate effect (from 1.4.2015)Amendment in rule 4(7) of the Cenvat Credit Rules to allow credit of service tax paid by recipient of service in partial reverse charge immediately on payment of tax ,with immediate effect (from 1.4.2015)Service Tax to be levied on service by way of access to amusement facility (amusement parks, water parks , theme parks etc)Service Tax rate is increased from 12.36% to 14%. New rate shall come into effect after the enactment of the Finance Bill, 2015. Notification No. 42/2012-ST is being rescindedSwachh Bharat Cess- Govt. to impose cess on all or any taxable service at the rate of 2% of the value of taxable serviceWe are committed to implementing a state of the art indirect tax system, the Goods and Services Tax, from April 1, 2016 - Finance MinisterNow issuing of Digital Invoices recognised in Service Tax.The term “government” defined Section 65B(26A)Section 80 providing waiver from penalty is proposed to be omitted.
Sponsorship Services [Sec 65(105)(zzzn)]
Effective upto 30th June, 2012
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Introduced With Effect From 1st May 2006
Relevant Notifications / Circulars
Accounting Code
Service Tax 00440358
Interest 00440359
Penalty 00441444

According to Section 65 (105) (zzzn), to any person, by any other person receiving sponsorship, in relation to such sponsorship, in any manner;

According to Section 65 (99a), “Sponsorship” includes naming an event after the sponsor, displaying the sponsor’s company logo or trading name, giving the sponsor exclusive or priority booking rights, sponsoring prizes or trophies for competition; but does not include any financial or other support in the form of donations or gifts, given by the donors subject to the condition that the service provider is under no obligation to provide anything in return to such donors.


Body corporate or firms involved in business or commerce sponsor events with an intent to obtain commercial benefit or bringing their name or products or services in public image to public attention by associating with a popular or successful event. This is an alternate form of advertisement. Consideration is normally paid in return for naming of the event after the sponsor or displaying the sponsoring company's logo or trading name or giving the sponsor exclusive or priority booking rights. Service tax is leviable only when the sponsor is any body corporate or firm. Sponsorship of sports events is excluded from the scope of this levy.


(a)  Small service providers whose aggregate value of taxable services rendered in the previous year has not exceeded the limit of Rs. 10,00,000/-  (Service Tax Notification No. 8/2008-ST dated 01.03.2008)

(b)  Services provided to the United Nations or International Organisations

(c)  Services provided to Special Economic Zones (SEZ) units (including unit under construction) and SEZ developers

(d)  Services which are exported as per ‘Export of Services’ Rules

(e)  Services provided for official or personal use of foreign diplomatic missions and family members of diplomatic missions.

(f)  Services provided by Reserve Bank of India

(g)  Out of total value of service provided proportionate value of goods and material provided by the Service Provider

Service Tax Notification No. 36/2010 S.T., dated 28-06-2010 Exemption for value of service received in advance by service providers prior to 01-7-2010
Service Tax Notification No. 30/2010-S.T., dated 22-06-2010 (Effective from 01-07-2010) Exemption to services provided to specific entities
Service Tax Notification No. 1/2007 S.T.,  dated 01-03-2007 Amendment to Service Tax Rules
Service Tax D. O. Letter F.No.334/03/2010-TRU , dated 01-07-2010 Clarification regarding issuance of notifications after enactment of the Finance Act, 2010, including the one in relation to exemption on advance received for sponsorship services.
Service Tax CBEC Instruction letter F. No.334/1/2010-TRU, dated 26-02-2010 Clarification regarding the changes made by the Finance Bill 2010 including the purpose and scope of amendment made to the definition of sponsorship services.
Service Tax CBEC Letter Dy. No 42/Comm-ST/2008, dated 08-02-2008 Instructions to field formations to examine applicability of service tax in respect of sponsorship services provided by the Indian Cricket League (ICL), and the Indian Premier League IPL)
Service Tax CBEC Instruction Letter File No. 334/4/2006-TRU dated 28.02.2006
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Case Laws Related

  • STO 2013 CESTAT 272
  • Sponsorship Service: Sports Event: Since the sponsorship agreement falls within the exclusionary clause i.e. the clause which excludes sponsorship services in relation to sports events, the appellant is clearly immune to the charge of service tax.

  • STO 2013 CESTAT 506
  • Sponsorship Service: Sale of Space or time for advertisement: Demand: Stay: Argument of the appellants that it was sponsorship service for which sponsorer was liable to pay service tax: On the basis of decision of pre deposit given by Tribunal in the case of United Spirits, directions issued to the appellants to make partial pre deposit.

    News Related

  • Service Tax on sponsorships dampens sports spirit
  • Service Tax on Sports Events - Time to Milk Cash Rich Cows
  • Service Tax Notices to IPL Sponsoring Companies.




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