30 April 2013
MY CLIENT RUNNING A NURSING HOME AND RECEIVED A SHOW CAUSE NOTICE FOR DUES OF SERVICE TAX SINCE FINANCIAL YEAR 2007-2008 TO 2011-12. PLS SUGGEST US THE MEANING OF NOTIFICATION NO.24/2010 DATED 22/06/2010 & 30/2011 DATED 25/04/2011 AS WE HAVE REGISTERED ACCORDING TO ABOVE NOTIFICATION FOR THE SAID PERIOD UNDER THE CAT OF "HEALTH SERVICES", BUT S.T. DEPARTMENT DEMANDING 40LAKHS DURING THE PERIOD FORM 2007-08, 08-09 & 09-10.
01 May 2013
Dear Sir, Noti. 24/2010 brought the levy of ST on nursing homes/hospitals where amounts were received from business entities or insurance co.s from 1 july 2010. The said levy was amended by Finance ACt 2011 and nursing homes/hospitals having more than 25 bed and AC were also brought into net, simultaneously all the healthcare services were made exempt through noti 30/2011. Therefore for a very short period such service was taxable when receipts were through insurance co.s or business entities only. There is no ST now.
I have examined one such show cause notice and have opined that no ST liability is maintainable.In your case no ST can be demanded for period prior to 2010 or after May 2011. For the period July 2010 to Apr 2011 the notice needs to be examined. However I beleive that even for that period no demand would sustain as the taxable head in SCN is not at all maintainable.
CAclubindia
