Directorate General of Service Tax, Mumbai

F.No.V/DGST/30-Misc-58/2006/4383 dt.12-12-2006.

Subject : Service Tax – Refund of Service Tax to air passengers upon cancellation of tickets and supply of statutory form to assessees – Regarding.

It is reported that in respect of the taxable service provided by an aircraft operator, i.e., air transport of any passenger embarking in India for international journey, in any class other than economy classification, the Airlines collect Service Tax, as applicable, at the time of booking of tickets, but do not refund it when tickets are cancelled. In such cases, the passenger ends up paying up the service tax without receiving any service. In this regard, please advise airlines that upon cancellation of tickets, there is an obligation on the part of the airline company not to collect service tax, and, therefore, the amount of service tax already collected must also be refunded to the passenger in such cases.

2. Another issue raised is that it is difficult to obtain statutory Forms (TR-6) for paying service tax. In this regard, the Hon’ble Finance Minister has observed that it is not enough that the statutory Forms are available on the official website. While this aspect should be publicized by the Service Tax Commissioners, it is also necessary to make material forms available to those who wish to use those forms for paying service tax or for filing in their returns.

3. Please advise the Commissioners to ensure that sufficient quantity of TR-6, ST-3 forms and other statutory forms are made available to the assessees at the Commissionerate/Division/Range offices.

4. Action taken may please be intimated to the undersigned at the earliest to enable us to apprise the Board.