SERVICE TAX TRADE NOTICE NO.15/2003     Dtd: 27/05/2003

Sub :- Service Tax - Internet telephony services - clarification - reg.

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         A copy of Circular No. ST 54/3/2003 Dated 21.04.2003 (F.No.149/9/2002 CX.4) of the Government of India, Ministry of Finance & Company Affairs, Department of Revenue, Central Board of Excise & Customs on the above subject is communicated herewith for information and necessary action.

                                                                                                               Sd/-

(V.V.HARIHARAN)

COMMISSIONER

 

To

 Government of India

 Ministry of Finance & Company Affairs

Department of Revenue Central Board of Excise & Customs

                                                                                   F.No.149/9/2002 CX.4 Dated : 21.04.2003

                                                  Circular No. ST 54/3/2003

           I am  directed to say that doubts has been raised regarding the classification of the Internet Telephony Service , as to whether this service is covered under the category of ‘telephone service’ or ‘online information and database access and/or retrieval service’ and hence liable to pay Service Tax.

                                           

2.                 Transmission of two-way voice communication through the medium of internet Telephony Service Providers are issued under section 4 of the Indian Telegraph Act, 1885,  the two way voice communication is made possible through data transfer over the internet. As per Section 65(19), 1994, the term “on-line information and database access and/or retrieval” means providing data or information, retrievable or, otherwise, to a customer in electronic form through a computer network. Accordingly, it is to confirm that Internet Telephony Services fall under the category of online information and database access and/or retrieval services.

       Sd/-

                                                                                      (MANISH MOHAN)

                        UNDER SECRETARY TO THE GOVERNMENT OF INDIA