6.0 Clarification in turnover based exemption – Notification No. 6/2005
6.1 Background: Notification 6/2005 exempts the ‘aggregate value’ and aggregate value was defined to mean first Rs.10 lakh received towards taxable services. After introduction of Point of Taxation Rules, 2011, generally, service tax is paid on the basis of invoices. Therefore, notification which exempted first Rs. 10 lakh received needed to be amended.
6.2 Amendment: Accordingly, now, w. e. f. 01.04.2012, Notification No. 5/2012 amends the notification 6/2005 to provide that definition of ‘aggregate value’ as under:
“aggregate value” means “aggregate value” means the sum total of value of taxable services charged in the first consecutive invoices issued or required to be issued, as the case may be, during a financial year but does not include value charged in invoices issued towards such services which are exempt from whole of service tax leviable thereon under section 66 of the said Finance Act under any other notification‟.
Now, the exemption has been provided to first 10 laks rupees in respect of which assessee liable to pay service tax.