Netizens are aware that recent Finance Bill (Budget) proposes to replace the word "commercial concern" appearing in various definitions of services with "person". As a consequence of this, the existing definition of ‘courier agency’ will change as follows:

Courier Agency means any person engaged in the door-to-door transportation of time-sensitive documents, goods or articles utilizing the services of a person, either directly or indirectly to carry or accompany such documents, goods or articles.

(the existing definition contains the words " a commercial concern" )

When service tax was introduced on courier services, the government (CBEC) has clarified vide letter F.No. 341/43/96 TRU dt. 31/10/1996, that "Speed Post" is not covered under the service tax as courier agency. The following is the clarification:

"It may be clarified that only such agencies fall with in the scope of the term "courier agency,’ which are commercial concerns. The term ‘commercial concern" does not include a Government department with in its scope. Accordingly the Speed Post services provided by the department of Posts do not attract service tax "

With the changes proposed to be brought under the definition of courier agency, the above clarification no longer holds good, because the word commercial concern is now proposed to be replaced with person. It is an accepted legal interpretation that ‘person’ covers in its ambit the government departments also.

Because of this reason only whenever the government intends to exclude the government departments form the service tax purview, it is specifically mentioned in the definition. For example in survey and map making service the taxable service defines as follows:

"to any person , by any other person , other than by an agency under the control of , or authorized by, the Government in relation to survey and map- making."

The recently proposed taxable services of transport of goods in container by rail excluded Government railway by specifically including the words "other than Government railway’ in the definition of taxable service.

Further, the halls , open spaces, rented out by Bombay Municipal Corporation and other municipal bodies across the country are treated as covered under Mandap Keeper service by the department as the definition mentions ‘ any person ". Commanding officer (Indian Navy), INS Hansa, Goa, was served an SCN for non payment of service tax on Airport Services (as they are providing certain services at Dabolim Airport, Goa, for some consideration )

From the above it is very evident that "person" contained in a definition of taxable service invariably covers all legal persons including government departments if they are providing any taxable service for a consideration. If the Finance Bill is passed in the present form, certainly the Speed Post services would come under service tax net.

Has Mr. PC in his attempt to collect more "nidhi" (revenue) forgotten his colleague Dayanidhi?