Finance Act 2008 gets President's assent

Finance Act 2008 passed with notifications in Service Tax

The Finance Act, 2008 received the assent of the President of India on the 10th May, 2008 which contains provisions for direct and indirect taxes for fiscal year 2008-09. The Finance Bill was earlier approved by both the houses of Parliament. Consequently the Finance Act, 2008 is being published in the Gazette of India dated 10th May, 2008 as Act No.18 of 2008.

With the President giving her assent to the Finance Bill, the government completes the Budgetary exercise for 2008-09 that initiated with the presentation of the General Budget by Finance Minister P Chidambaram in Lok Sabha on February 29.

Central Government has issued seven notifications relating to service tax so as to give effect to various provisions of the Finance Act, 2008.

2. Transaction between associated enterprises:

2.1 In the Finance Act, 2008, section 67 has been amended. As per this amendment, service tax is required to be paid by the person liable to pay service tax on the taxable services provided even if the consideration for the taxable services provided is not actually received. In such cases, service tax is required to be paid immediately after crediting/debiting of the amount in the books of accounts or receipt of payment, whichever is earlier. However, this provision is restricted to transaction between associated enterprises and shall come into force w.e.f. 10th May, 2008. Explanation to Rule 6(1) of the Service Tax Rules, 1994 has been added as removal of doubts stating that any payment received towards the value of taxable service shall include any amount credited or debited, as case may be, to any account, whether called ‘Suspense account’ or by any other name, in the books of account of a person liable to pay service tax [Refer notification No.19/2008-Service Tax dated 10.05.08].

3. Certain provisions relating to the levy of service tax in the Finance Act, 2008 shall come into force from a date to be notified. For this purpose, notifications No.18/2008 to 24/2008-Service Tax, all dated 10th May, 2008 have been issued.

4. Following changes / amendments shall come into force w.e.f. 16.05.2008:

· Seven services which are specifically mentioned in the category of taxable services and amendments made relating to existing taxable services.

· Amendments made in section 65 (defines taxable services and specified terms used in relation to taxable services) and section 66 (charging section) vide the Finance Act, 2008.

· Amendments made in Export of Services Rules, 2005 and the Taxation of Services (Provided from Outside India and Received in India) Rules, 2006 so as to categorise the newly specified taxable services under Rule 3 [Refer notification No.20/2008-Service Tax dated 10.05.08 & notification No.21/2008-Service Tax dated 10.05.08].

· Optional Scheme for payment of service tax on Purchase or Sale of foreign currency: Service tax is leviable on purchase or sale of foreign currency, including money changing, provided by an authorized dealer in foreign currency or an authorised money changer, or a foreign exchange broker. Where the consideration for the services provided in relation to purchase or sale of foreign currency is not explicitly indicated, the person liable to pay service tax has been given the option to pay service tax calculated at the rate of 0.25% of the gross amount of currency exchanged. The method is prescribed under rule 6(7B) of the Service Tax Rules, 1994. [Refer notification No.19/2008-Service Tax dated 10.05.08].

5. Government of India has already notified, vide notifications No.41/2007-Service Tax, dated 06.10.07 and 43/2007-ST, dated 29.11.07, sixteen taxable services attributable to export goods, whether or not in the nature of input services, providing refund of service tax paid on the said sixteen taxable services. Consequent upon the enactment of the Finance Act, 2008, Government has notified 16.05.2008 as the effective date for the specifically included taxable services vide the Finance Act, 2008. Out of the said taxable services, refund of service tax paid by exporters has been extended to the following additional 3 services:

· Purchase or sale of foreign currency under banking and other financial service,

· Purchase or sale of foreign currency under foreign exchange broking service,

· Supply of tangible goods for use service

Source: Banknetindia

Students protest against OBC Quota in Supreme court lawns

A group of about 350 students from premier medical and other colleges held a protest on the lawns of the Supreme Court Friday against the 27 percent quota for other backward classes students in higher educational institutions. Around 10 students were injured in a clash with the police.

The police said more than 90 students were detained and let off an hour later.

The students were from the All India Institute of Medical Sciences (AIIMS), Jawaharlal Nehru University (JNU), Delhi University, Indian Institute of Technology-Delhi and some medical colleges.

The protesters entered the apex court premises in small groups and gathered in the lawns around 11 a.m. They chanted anti-government slogans and accused the government of trying to circumvent the court ruling by planning to extend quota benefits to post-graduate courses.

"We just want the court ruling to be implemented in the right way," said Kaushal Kant Mishra, a doctor at AIIMS.

The students who were injured in a lash with the police were admitted to the Ram Manohar Lohia Hospital. Some of them were discharged after first-aid.

On April 10, SC upheld the law for implementing 27 percent quota for OBCs in centrally-run educational institutions of higher learning.

Domestic violence, malnutrition linked in India

Washington, April 25 Preventing domestic violence could be just as effective as a pharmaceutical approach in combating anaemia among women in India, say researchers. They found that women and children in India experiencing multiple incidents of domestic violence are more likely to be anaemic and underweight.

"This is strong evidence that domestic violence is linked with malnutrition among both mothers and children. In India, the withholding of food is a documented form of abuse and is likely correlated with the perpetration of physical violence," said S.V. Subramanian of the Harvard School of Public Health (HSPH)

The exhaustive study included 69,072 (aged 15-49 years) women and 14,552 children (12-35 months) from the Indian National Family Health Survey of 1998-99.

The participants were personally interviewed by trained personnel, and the data collected included body measurements, blood samples and information on women's and child's exposure to domestic violence in the previous 12 months.

The researchers found that women who reported more than one instance of domestic violence in the previous year had a 11 percent increased likelihood of having anaemia and a 21 percent increased likelihood of being underweight, as compared to women with no such history.

The data suggests a relation between domestic violence and malnutrition among women and children in India.

In India, the withholding of food as a type of abuse could be a factor in the link between physical domestic violence and nutrient deficiencies that cause anaemia and underweight.

Additionally, domestic violence has been strongly associated with a woman's inability to make decisions for herself and her family, including the choice of types and quantities of food she prepares


The authors' second explanation is that the link between domestic violence and nutritional deficiencies may also reflect the effects of psychological stress.

Women and children who experience domestic violence tend to have higher levels of psychological stress, which has been associated with anaemia and being underweight.

The findings were published online on March 26 in The American Journal of Epidemiology.

Related links :

- The Protection Of Women From Domestic Violence Act, 2005

- Latest News Headlines - "Domestic Violence Act"