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Service Tax Interview Questions & Answers - Learning Mode

Service Tax Interview Questions & Answers - Learning Mode

Most of the paid services you take you have to pay service tax on those services. This tax is called service tax. Over the past few years, service tax been expanded to cover new services. Few of the major service which comes under vicinity of service tax are telephone, tour operator, architect, interior decorator, advertising, beauty parlor, health center, banking and financial service, event management, maintenance service, consultancy service Current rate of interest on service tax is 14.5%. This tax is passed on to us by service provider.

Try Service Tax Interview Questions & Answers - Exam Mode

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Service Tax Interview Questions & Answers - Learning Mode
Try Service Tax Interview Questions & Answers - Exam Mode
Question: What is e-filing of Service Tax Returns?

Answer: The e-filing is a facility for electronic filing of Service Tax Returns through the Internet. Source:
Question: What are the duties / taxes that can be availed as credit in case of Service Tax?

Answer: As mentioned at para 12.1, Duties paid on the inputs and capital goods, and the Service Tax paid on the ?input‟ services can be taken as credit. Education Cess paid on the Excise duty and Service Tax can also be taken as credit. However, the credit of such Education Cess availed can be utilized only for payment of Education Cess relating to output service.

The interest and penalty amounts cannot be taken as credit. Source:
Question: What is Export of Services? Whether export of services is exempted from Service Tax?

Answer: What constitute export of service is defined in the Export of Service Rules, 2005. The export of taxable services is exempted from Service Tax. Source:
Question: If export proceeds are received in Indian currency, will it be denied export benefit?

Answer: If export proceeds are received in Indian currency, no export benefits shall be available.

[Ref. Rule 3(2)(b) of Export of Service Rules, 2005]. Source:
Question: Can the Department modify the value determined by the service provider?

Answer: (i) The Central Excise Officer is empowered to verify the accuracy of any information furnished or document presented for valuation.

(ii) If the value adopted by the Service Tax assesses is not acceptable in accordance with the statute, the officer shall issue a show cause notice (SCN) proposing to determine the value as per the law.

(iii) The SCN would be decided after providing reasonable opportunity of being heard to the assesses.

(Rule 4 of the Service Tax (Determination Source:
Question: For what exactly can Automation of Central Excise and Service Tax (ACES) be used?

Answer: i. Online registration and amendment of registrations details.

ii. Electronic filing of documents such as returns, claims, letter for permission/ intimation etc.

iii. Online tracking of status of applications filed for claims, permission/ intimation etc.

iv. Online facility to view documents like Registration Certificates, Returns, Show Cause Notice, Order-in-Original etc. Source:
Question: Can Service Tax Show Cause Notice be waived?

Answer: Where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person chargeable with the service tax, or the person to whom such tax refund has erroneously been made, may pay the amount of such service tax on the basis of his own ascertainment thereof, or on the basis of tax ascertained by a Central Excise/Service Tax Officer before service of notice on him and inform the Central Excise/Service Tax Officer of such payment in writing, in suc Source:
Question: Which banks provide the facility of e-payment of Service Tax?

Answer: The following banks provide e-payment facility.
Name of Bank
Name of Central Excise / Service Tax Commissionerate for which the Bank is authorised to collect Revenue through e-Payment

Allahabad Bank
All Commissionerates
Bank of Baroda
All Commissionerates
Bank of India
All Commissionerates
Bank of Maharashtra
All Commissionerates
Canara Bank
All Commissionerates
Central Bank
All Commissionerates
Question: What will be "Usual Place of Residence" of a body corporate?

Answer: Usual Place of Residence, in relation to a body corporate, means the place where it is incorporated or otherwise legally constituted. (Ref.: Explanation 2 to sub-section 2 of Section 66A of the Finance Act,1994.) Source:
Question: Where can the Service Tax Department be contacted?

Answer: In Ahmedabad, Bangalore, Chennai, Delhi, Kolkata & Mumbai (Mumbai I & II) there are exclusive Service Tax Commissionerates . The contact informations in respect of all the locations are given below:

Phone No.
E-mail Address / Web site


Question: When paid by cheque, which date will be treated as date of payment for Service Tax Payment?

Answer: The date of presentation of the cheque to the bank designated by the Central Board of Excise & Customs for this purpose shall be deemed to be the date on which service tax has been paid subject to realization of that cheque. Source:
Question: Whether cleaning of export cargo by fumigation is taxable under "cleaning services"?

Answer: No. Fumigation of export cargo including agricultural/horticultural produce, whether loaded into containers or otherwise, does not satisfy the statutory definition of "cleaning activity" under Section 65(24b) of the Finance Act, 1994. Further the cleaning of the containers used for exporting the cargo are also exempted from the scope of cleaning services. Source:
Question: When should a prospective assessee obtain registration?

Answer: i. When a person commences business of providing a taxable service, he is required to register himself within 30 days of such commencement of business[sub-rule (1) of Rule 4 of Service Tax Rules, 1994].

ii. In case service tax is extended to a new service, an existing service provider must register himself, unless he is eligible for exemption under any notification, within a period of 30 days from the date of new levy [sub-rule 5A of Rule 4 of the Service Tax Rules, 1994]. Source:
Question: Is it possible to levy separate tariff for the same accommodation in respect of corporate/privileged customers and other normal customers?

Answer: It is possible to levy separate tariff for the same accommodation in respect of a class of customers which can be recognized as a distinct class on an intelligible criterion. However, it is not applicable for a single or few corporate entities. Source:
Question: How to pay Service Tax?

Answer: Form G.A.R.7 (previously known as TR6 Challan) should be used to make service tax payments. Payment of service tax may be made at the specified branches of the designated banks. The details of such Banks and branches may be obtained from the nearest Central Excise Office/Service Tax Office.

Service Tax can also be paid electronically, using e-payment facility. Source:
Question: What are the Returns a service tax assessee has to file?

Answer: ST-3 Return ? For all the registered assessee, including Input ServiceDistributors, (Ref. Section 70 of Finance Act,1994 and Rule 7 of Service Tax Rules, 1994 read with Notfn.No. 14/2007-ST dated 02.04.2007).

ST-3A Return ?The assessee who is making provisional assessment under rule 6(4) of the Service Tax Rules, 1994.

The Forms are available at any Stationery shop selling Govt. forms. These can also be downloaded from Source:
Question: Whether proportionate amount of service tax paid on shared services that have not been refunded after applying the formula, shall be available to the DTA Units of the entity as cenvat credit?

Answer: Yes. Available. Source:
Question: How to file Service Tax Returns?

Answer: The details in respect of each month/ Quarter, as the case may be, of the period for which the return is filed, should be furnished in the Form ST-3, separately. The instructions for filing return are mentioned in the Form itself.

It should be accompanied by copies of all the GAR-7 Challans for payment of Service Tax during the relevant period. Source:
Question: What is the procedure for Registration? Who should be approached for Service Tax Registration?

Answer: A prospective Service Tax assessee (service provider or service receiver) or "Input Service Distributor" seeking registration should file an application in Form ST-1 (in duplicate) [prescribed vide Notfn.No. 32/2005 dated 20.10.2005 as amended Notfn. No. 11/2008 dated 1.3.2008] before the jurisdictional Central Excise/Service Tax officer. To verify the correctness of declaration in the said form, certain documents such as copy of PAN card, proof of address of business premise(s), constitution of Source:
Question: Is the value added tax imposed by States required to be included for the purpose of service tax?

Answer: For the purpose of service tax, State Value Added Tax (VAT) has to be excluded from the taxable value. Source:

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