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2/23/2017 ARCHITECT'SSERVICES

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5.Architect'sServices
DepartmentalOfficers

GovernmentInitiatives (A)DateofIntroduction:
16.10.1998(NotificationNo.53/98S.T.,dated07.10.1998)
PublicInformation

StakeholderConsultation (B)Definitionandscopeofservice:

RelatedSites
"TaxableService"meansanyserviceprovidedortobeprovidedtoanyperson,byanarchitectinhisprofessionalcapacity,inanymanner
LegalAffairs [Section65(105)(p)ofFinanceAct,1994asamended]

AAR/D.G.Audit
"Architect"meansanypersonwhosenameis,forthetimebeing,enteredintheregisterofarchitectsmaintainedundersection23ofthe
ArchitectAct,1972(20of1972)andalsoincludesanycommercialconcernengagedinanymanner,whetherdirectlyorindirectly,in
QuickLinks renderingservicesinthefieldofarchitecture
[Section65(6)ofFinanceAct,1994asamended]
ExchangeRateNotifications
(C)RateofTax&AccountingCode:
NotificationsofCustoms
RateofTax AccountingCode
NotificationsofCentralExcise
ServiceTax 10%ofthevalueofservices 00440072
NotificationsofServiceTax
EducationCess 2%oftheservicetaxpayable 00440298

SecondaryandHigherEducationcess 1%oftheservicetaxpayable. 00440426

OtherPenalty/interest Asleviedorapplicable 00440073

(Rateoftaxiseffectivefrom24.02.2009.)

(D)ClassificationofTaxableServices:
(1)Theclassificationoftaxableservicesshallbedeterminedaccordingtothetermsofthesubclauses(105)ofsection65

(2)Whenforanyreason,ataxableserviceisprimafacie,classifiableundertwoormoresubclausesofclause(105)ofsection65,
classificationshallbeeffectedasfollows:
(a)thesubclausewhichprovidesthemostspecificdescriptionshallbepreferredtosubclausesprovidingamoregeneraldescription
(b)compositeservicesconsistingofacombinationofdifferentserviceswhichcannotbeclassifiedinthemannerspecifiedinclause(a),
shallbeclassifiedasiftheyconsistedofaservicewhichgivesthemtheiressentialcharacter,insofarasthiscriterionisapplicable
(c)whenaservicecannotbeclassifiedinthemannerspecifiedinclause(a)orclause(b),itshallbeclassifiedunderthesubclausewhich
occursfirstamongthesubclauseswhichequallymeritsconsideration.
(Sec.65AofFinanceAct,1994)

(E)ValuationoftaxableservicesforchargingServicetax

(1)Servicetaxchargeableonanytaxableservicewithreferencetoitsvalueshall,
(i)inacasewheretheprovisionofserviceisforaconsiderationinmoney,bethegrossamountchargedbytheserviceproviderforsuch
serviceprovidedortobeprovidedbyhim
(ii)inacasewheretheprovisionofserviceisforaconsiderationnotwhollyorpartlyconsistingofmoney,besuchamountinmoney,withthe
additionofservicetaxcharged,isequivalenttotheconsideration
(iii)inacasewheretheprovisionofserviceisforaconsiderationwhichisnotascertainable,betheamountasmaybedeterminedinthe
prescribedmanner.
(2)Wherethegrossamountchargedbyaserviceprovider,fortheserviceprovidedortobeprovidedisinclusiveofservicetaxpayable,the
valueofsuchtaxableserviceshallbesuchamountas,withtheadditionoftaxpayable,isequaltothegrossamountcharged.

(3)Thegrossamountchargedforthetaxableserviceshallincludeanyamountreceivedtowardsthetaxableservicebefore,duringorafter
provisionofsuchservice.

(4)Subjecttotheprovisionsofsubsections(1),(2)and(3),thevalueshallbedeterminedinsuchmannerasmaybeprescribed.

Explanation.Forthepurposesofthissection,

(a)"consideration"includesanyamountthatispayableforthetaxableservicesprovidedortobeprovided
(b)"money"includesanycurrency,cheque,promissorynote,letterofcredit,draft,payorder,travellerscheque,moneyorder,postal
remittanceandothersimilarinstrumentsbutdoesnotincludecurrencythatisheldforitsnumismaticvalue
(c)"grossamountcharged"includespaymentbycheque,creditcard,deductionfromaccountandanyformofpaymentbyissueofcredit
notesordebitnotesand'bookadjustment,andanyamountcreditedordebited,asthecasemaybe,toanyaccount,whethercalled
"Suspenseaccount"orbyanyothername,inthebooksofaccountofapersonliabletopayservicetax,wherethetransactionoftaxable
serviceiswithanyassociatedenterprise.
(Sec.67ofFinanceAct,1994)

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2/23/2017 ARCHITECT'SSERVICES

InclusioninorExclusionfromvalueofcertainexpenditureorcost:

(1)Whereanyexpenditureorcostsareincurredbytheserviceproviderinthecourseofprovidingtaxableservice,allsuchexpenditureor
costsshallbetreatedasconsiderationforthetaxableserviceprovidedortobeprovidedandshallbeincludedinthevalueforthepurpose
ofchargingservicetaxonthesaidservice.

[Rule5(1)ofServiceTax(DeterminationofValue)Rules,2006)]
(2)Theexpenditureorcostsincurredbytheserviceproviderasapureagentoftherecipientofservice,shallbeexcludedfromthevalueof
thetaxableserviceifallthefollowingconditionsaresatisfied,namely:

(i)theserviceprovideractsasapureagentoftherecipientofservicewhenhemakespaymenttothirdpartyforthegoodsorservices
procured
(ii)therecipientofservicereceivesandusesthegoodsorservicessoprocuredbytheserviceproviderinhiscapacityaspureagentof
therecipientofservice
(iii)therecipientofserviceisliabletomakepaymenttothethirdparty
(iv)therecipientofserviceauthorizestheserviceprovidertomakepaymentonhisbehalf
(v)therecipientofserviceknowsthatthegoodsandservicesforwhichpaymenthasbeenmadebytheserviceprovidershallbe
providedbythethirdparty
(vi)thepaymentmadebytheserviceprovideronbehalfoftherecipientofservicehasbeenseparatelyindicatedintheinvoiceissuedby
theserviceprovidertotherecipientofservice
(vii)theserviceproviderrecoversfromtherecipientofserviceonlysuchamountashasbeenpaidbyhimtothethirdpartyand
(viii)thegoodsorservicesprocuredbytheserviceproviderfromthethirdpartyasapureagentoftherecipientofserviceareinadditionto
theservicesheprovidesonhisownaccount.
[Rule5(2)ofServiceTax(DeterminationofValue)Rules,2006)]

(F)ClarificationsissuedbytheBoard/Ministry:
ScopeofArchitect'sServices.(1)UnderSection65oftheFinanceAct,1994an"architect"hasbeendefinedtomeananypersonwhose
nameis,forthetimebeing,enteredintheregisterofarchitectsmaintainedunderSection23oftheArchitectsAct,1972andalsoincludes
anycommercialconcernengagedinanymanner,whetherdirectlyorindirectly,inrenderingservicesinthefieldofarchitecture.Thenature
andscopeoftheservicesrenderedbyarchitectsarewelldelineatedundertheprovisionsoftheArchitectsAct.
(2)Broadly,theworkofanarchitectstartsfromprovidingappropriateadvicekeepinginviewtherequirementsoftheclientatthepreliminary
stageofinitialsketches,specificationsanddrawingofplans,andconsistsofprovidingdetaileddrawings,approvalofthedrawingsfromthe
concernedauthorities,supervisionateachstageofconstructionandtillthepointwhenthecompletioncertificateisobtainedfromthe
authorities.
(3)Theservicesrenderedbyanarchitectareofaverydiversenatureandarespreadoverafairlylongperiodoftime.Atthetimewhenan
architectisactuallyengagedforaparticularproject,letters(contractisexchangedforthesamebetweenthearchitectandtheperson
engaginghim.Thecontract/agreementdetailstheentirescopeoftheservicestoberenderedbythearchitect,includingthetermsand
conditionsofemploymentandthepaymentschedulefortheservicerenderedbythearchitect.The"taxableservice"meansanyservice
providedtoaclientbythearchitectinhisprofessionalcapacityinanymanner.

(VideM.F.(D.R.)LetterNo.11/3/98TRUdated07.10.1998)

(G)Exemption&Exclusion:
1.ExemptiontoSmallScaleServiceProviders:
Inexerciseofthepowersconferredbysubsection(1)ofsection93oftheFinanceAct,1994(32of1994)(hereinafterreferredtoasthesaid
FinanceAct),theCentralGovernment,onbeingsatisfiedthatitisnecessaryinthepublicinterestsotodo,herebyexemptstaxableservices
ofaggregatevaluenotexceedingTenlakh*rupeesinanyfinancialyearfromthewholeoftheservicetaxleviablethereonundersection66
ofthesaidFinanceAct:

Providedthatnothingcontainedinthisnotificationshallapplyto,

(i)taxableservicesprovidedbyapersonunderabrandnameortradename,whetherregisteredornot,ofanotherpersonor
(ii)suchvalueoftaxableservicesinrespectofwhichservicetaxshallbepaidbysuchpersonandinsuchmannerasspecifiedundersub
section(2)ofsection68ofthesaidFinanceActreadwithServiceTaxRules,1994.

2.Theexemptioncontainedinthisnotificationshallapplysubjecttothefollowingconditions,namely:

(i)theprovideroftaxableservicehastheoptionnottoavailtheexemptioncontainedinthisnotificationandpayservicetaxonthe
taxableservicesprovidedbyhimandsuchoption,onceexercisedinafinancialyear,shallnotbewithdrawnduringtheremainingpartof
suchfinancialyear
(ii)theprovideroftaxableserviceshallnotavailtheCENVATcreditofservicetaxpaidonanyinputservices,underrule3orrule13of
theCENVATCreditRules,2004(hereinafterreferredtoasthesaidrules),usedforprovidingthesaidtaxableservice,forwhichexemption
frompaymentofservicetaxunderthisnotificationisavailedof
(iii)theprovideroftaxableserviceshallnotavailtheCENVATcreditunderrule3ofthesaidrules,oncapitalgoodsreceivedinthe
premisesofproviderofsuchtaxableserviceduringtheperiodinwhichtheserviceprovideravailsexemptionfrompaymentofservicetax
underthisnotification
(iv)theprovideroftaxableserviceshallavailtheCENVATcreditonlyonsuchinputsorinputservicesreceived,onorafterthedateon
whichtheserviceproviderstartspayingservicetax,andusedfortheprovisionoftaxableservicesforwhichservicetaxispayable
(v)theprovideroftaxableservicewhostartsavailingexemptionunderthisnotificationshallberequiredtopayanamountequivalentto
theCENVATcredittakenbyhim,ifany,inrespectofsuchinputslyinginstockorinprocessonthedateonwhichtheprovideroftaxable
servicestartsavailingexemptionunderthisnotification
(vi)thebalanceofCENVATcreditlyingunutilisedintheaccountofthetaxableserviceproviderafterdeductingtheamountreferredtoin
subparagraph(v),ifany,shallnotbeutilisedintermsofprovisionundersubrule(4)ofrule3ofthesaidrulesandshalllapseontheday
suchserviceproviderstartsavailingtheexemptionunderthisnotification
(vii)whereataxableserviceproviderprovidesoneormoretaxableservicesfromoneormorepremises,theexemptionunderthis
notificationshallapplytotheaggregatevalueofallsuchtaxableservicesandfromallsuchpremisesandnotseparatelyforeachpremises
oreachservicesand
(viii)theaggregatevalueoftaxableservicesrenderedbyaprovideroftaxableservicefromoneormorepremises,doesnotexceed
rupees*tenlakhsintheprecedingfinancialyear.

3.Forthepurposesofdeterminingaggregatevaluenotexceedingten*lakhrupees,toavailexemptionunderthisnotification,inrelationto
taxableserviceprovidedbyagoodstransportagency,thepaymentreceivedtowardsthegrossamountchargedbysuchgoodstransport

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2/23/2017 ARCHITECT'SSERVICES
agencyundersection67forwhichthepersonliableforpayingservicetaxisasspecifiedundersubsection(2)ofsection68ofthesaid
FinanceActreadwithServiceTaxRules,1994,shallnotbetakenintoaccount.

Explanation.Forthepurposesofthisnotification,

(A)"brandname"or"tradename"meansabrandnameoratradename,whetherregisteredornot,thatistosay,anameoramark,suchas
symbol,monogram,logo,label,signature,orinventedwordorwritingwhichisusedinrelationtosuchspecifiedservicesforthepurposeof
indicating,orsoastoindicateaconnectioninthecourseoftradebetweensuchspecifiedservicesandsomepersonusingsuchnameor
markwithorwithoutanyindicationoftheidentityofthatperson

(B)"aggregatevaluenotexceeding*tenlakhrupeesmeansthesumtotaloffirstconsecutivepaymentsreceivedduringafinancialyear
towardsthegrossamount,asprescribedundersection67ofthesaidFinanceAct,chargedbytheserviceprovidertowardstaxableservices
tilltheaggregateamountofsuchpaymentsisequaltotenlakhrupeesbutdoesnotincludepaymentsreceivedtowardssuchgrossamount
whichareexemptfromwholeofservicetaxleviablethereonundersection66ofthesaidFinanceActunderanyothernotification.
4.Thisnotificationshallcomeintoforceonthe1stdayofApril,2005.
[NotificationNo.6/2005ST,dated132005.*AmendedbyNotfn.No.8/2008STdated01.03.2008]

2.ServicestoUNAgencies
ServicesprovidedtoUnitedNationsoranInternationalOrganizationsareexempt.
[NotificationNo.16/2002ST,dated282002]
3.Exportofservice:
Anyservicewhichistaxableunderclause105ofSection65maybeexportedwithoutpaymentofservicetax.
(Rule4ofExportofServicesRules,2005)
4.ExemptiontoservicesprovidedtoadeveloperofSEZoraunitofSEZ:
Exemptsthetaxableservicesspecifiedinclause(105)ofsection65ofthesaidFinanceAct,whichareprovidedinrelationtotheauthorized
operationsinaSpecialEconomicZone,andreceivedbyadeveloperorunitsofaSpecialEconomicZone,whetherornotthesaidtaxable
servicesareprovidedinsidetheSpecialEconomicZone,fromthewholeoftheservicetaxleviablethereonundersection66ofthesaid
FinanceActsubjecttocertainconditions.(Refernotificationfordetails)
{NotificationNo.09/2009STdated03.03.2009(Priorto03.03.2009Notfn.No4/2004STdated31.03.2004)}

5.Exemptiontovalueofgoods&materialsoldbyserviceprovider:
Inexerciseofthepowersconferredbysection93oftheFinanceAct,1994(32of1994),theCentralGovernment,beingsatisfiedthatitis
necessaryinthepublicinterestsotodo,herebyexemptssomuchofthevalueofallthetaxableservices,asisequaltothevalueofgoods
andmaterialssoldbytheserviceprovidertotherecipientofservice,fromtheservicetaxleviablethereonundersection(66)ofthesaidAct,
subjecttoconditionthatthereisdocumentaryproofspecificallyindicatingthevalueofthesaidgoodsandmaterials.
(NotificationNo.12/2003STdated20.06.2003effectivefrom01.07.2003)

6.ExemptiontotaxableservicesprovidedbyTBIandSTEP:
Alltaxableservices,providedbyaTechnologyBusinessIncubator(TBI)oraScienceandTechnologyEntrepreneurshipPark(STEP)
recognizedbytheNationalScienceandtechnologyEntrepreneurshipDevelopmentBoard(NSTEDB)oftheDepartmentofScienceand
Technology,Govt.ofIndiafromthewholeoftheservicetaxleviablethereonsubjecttiocertainconditionsandprocedures.(Refernotification
fordetails)
(NotificationNo.09/2007STdated01.03.2007)

7.ExemptiontotaxableservicesprovidedbyentrepreneurslocatedwithinthepremisesofTBIorSTEP:
Alltaxableservices,providedbyanentrepreneurlocatedwithinthepremisesofaTechnologyBusinessIncubator(TBI)oraScienceand
TechnologyEntrepreneurshipPark(STEP)recognizedbytheNationalScienceandtechnologyEntrepreneurshipDevelopmentBoard
(NSTEDB)oftheDepartmentofScienceandTechnology,Govt.ofIndiafromthewholeoftheservicetaxleviablethereonsubjecttocertain
conditionsandprocedures.(Refernotificationfordetails)
(NotificationNo.10/2007STdated01.03.2007)

8.ExemptiontoservicesprovidedtoForeignDiplomaticMissionsorConsularPostinIndia:
Allservicesprovidedbyanyperson,fortheofficialuseofaForeignDiplomaticMissionorConsularPostinIndiaareexemptedfromservice
taxsubjecttocertainconditionsandprocedures.(Refernotificationfordetails)
(NotificationNo.33/2007STdated23.05.2007)

9.ExemptiontoservicesprovidedforpersonaluseofafamilymemberofDiplomaticAgentorCareerConsularOfficerspostedin
ForeignDiplomaticMission/ConsularPostinIndia:
Allservicesprovidedbyanyperson,forpersonaluseoffamilymemberofDiplomaticAgentsorCareerConsularofficerspostedinaForeign
DiplomaticMissionorConsularPostinIndiaareexemptedfromservicetaxsubjecttocertainconditionsandprocedures.(Refernotification
fordetails)
(NotificationNo.34/2007STdated23.05.2007)
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