Circulars/Trade
Notices/Clarification
Circular
Circular
No. ST 54 /3 /2003, 21st
April,2003
F.No.149/9/2002
CX.4
Government of India
Ministry of Finance & Company Affairs
Department of Revenue
Central Board of Excise & Customs
Subject:-Internet
telephony services – clarification - reg.
I am directed to say that doubts has been raised
regarding the classification of the Internet Telephony Service,
as to whether this service is covered under the category of ‘telephone
service’ or ‘online information and database access and/or retrieval
service’ and hence liable to pay Service Tax.
2.
Transmission of two-way voice communication through
the medium of Internet is called Internet Telephony. Even
if the licences to Internet Telephony Service Providers are issued
under section 4 of the Indian Telegraph Act, 1885, the two way
voice communication is made possible through data transfer over
the Internet. As per Section 65(19), 1994, the term “on-line
information and database access and/or retrieval” means providing
data or information, retrievable or, otherwise, to a customer
in electronic form through a computer network. Accordingly,
it is to confirm that Internet Telephony Services fall under the
category of online information and database access and /or retrieval
services.
3. The
field formations may suitably be informed.
4. Trade
Notice may be issued for the information of the trade.
5. The
receipt of this Circular may kindly be acknowledged.
6.
Hindi version will follow.
Manish Mohan
Under Secretary to the Government of India |
Act