The essential ingredients of these services are geological, geophysical or other prospecting surface or sub-surface, surveying or map making services. Such services must be in relation to location or exploration of deposits of mineral, oil or gas.
Geological means science related to history and development of earths crust , with its successive floras and faunas
Geophysical means study of physics of earth including fields of meteorology, hydrology, oceanography, seismography, volcano logy, magnetism, radioactivity and geodesy.
Prospecting means to search, explore an area or a region by means of experimental drilling or excavation.
Surface means outside part or uppermost layer. Here it means that part of the earth or geologic section lying over the minerals in question.
Sub-surface means relating to or being something located to beneath the surface especially underground
Surveying means that branch of applied mathematics that teaches the art of determining the area of any portion of the surface of the earth, the length and direction of the bounding lines, and the outline of the surface and of accurately delineating the whole on paper.
Exploration means examination and investigation of land supposed to contain valuable minerals by drilling, boring, sinking shafts, driving tunnels and other means for the purpose of discovering the presence of ore and its extent.
Mineral means any natural constituent of the crust of the earth inorganic or fossil homogenous in structure having a definite composition and known crystallization.
Oil means any of the numerous unctuous combustible substances that are liquid or at easily liquefiable on warming, are soluble in either not in water or leave a greasy stain on paper or cloth.
Gas means a fluid (as air) that has neither independent shape nor volume but tends to expand indefinitely.
Normally the government of India through respective Ministries invited tender for survey and exploration. The person is allotted a specific area for survey and exploration of a particular mineral, oil and gas. The person has to conduct the survey and informs the Government about the result of such survey and exploration. The representative of Managing Committee from the Government of India and the person carrying out survey and exploration is formed to extract the mineral, oil and gas. Such a person is treated as service provider
Activities such as seismic survey, collection/processing/interpretation of data and drilling or testing in relation to survey and exploration would fall within the ambit of taxable service. Services rendered in relation to survey and exploration is covered and not the actual activity of extraction after the survey and exploration. The transport, refining, processing or production of the extracted products would be taxed under ‘mining services’.
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