The Hindu Business Line : <I>A liberal</I> <I>serving</I>

Gentle Guildenstern and Rosencrantz speak of laying their service `freely' at the feet of Queen Gertrude and King Claudius, in Shakespeare's Hamlet, Act II, scene II. And an anguished Queen tells them, "I beseech you instantly to visit my too much changed son."

What has been anguishing accountants, though, is the post-Budge scene, with too much change in service tax. Their plight may well turn into an enduring tragedy like that of the Prince of Denmark, what with the CA profession burdened with financial handicaps as against a pampered legal tribe.

Just the time to take the law in your hands, literally, by delving into a tome on the subject — A Handbook of Service Tax: Law, Practice & Procedure, by C. Parthasarathy and Sanjiv Agarwal, from Snow White Publications (www.swpindia.com). The 22nd edition, brought out this month, comes with a free volume titled Notifications and Circulars on Service Tax.

Raja J. Chelliah's foreword to the first edition, in October 1994, argued why it is necessary to integrate taxes on services and goods into one general VAT or value added tax, "because the sectors manufacturing goods use services and in turn the sectors manufacturing services use goods."

Part I of the book has a `referencer' with useful tables summarising various obligations under service tax, due dates, list of general exemptions and so on.

A graph of the revenue collections under service tax shows the steady growth, from zilch to Rs 17,500 crore in about a decade. Of added value will be an index.

The authors discuss the statutory provisions and rules in part II of the book. Their commentary cites case laws and draws upon clarifications issued by the Department from time to time.

For instance, one learns that in Jodhpur Chartered Accountants Society vs Union of India (2002) it was held that service tax is distinct from profession tax.

In the Indian Institute of Architects case, the Madras High Court had observed: "It is only the services offered by the chartered accountants in their professional capacity which are made taxable and the services other than auditing and accounting provided by the practising chartered accountant are exempted from tax."

Alas, that was in 2002, when a 1998 diktat of the Department had exempted non-exclusive services. With the removal of that notification, gone is the level-playing field vis-à-vis advocates, rues the Institute of Chartered Accountants of India, which has been spearheading the protest against the changes. Recent decisions find a mention in the book. For instance, the Google case (2006) is cited under `advertising agency'.

Merely selling space for display of an advertisement would be `providing a service to the clients or advertisers,' the Authority for Advance Rulings had opined in that case.

"The making, preparing, displaying or exhibiting are alternative and not cumulative and any service provided in connection with any one of these would render it within the ambit of advertising agency."

Useful addition to your shelf.

BooksOfAccount@TheHindu.co.in

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