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Service tax at a Glance


“A Short Note on Place of Provision of Service ”


Basic Concepts


  • Services need to be taxed in the “jurisdiction of their consumption”


  • “Services provided in taxable territory” alone are taxable [Sec 66B-Charging Section]


  • Taxable Territory (TT) means “territory to which the provisions of this chapter [Chapter V]  apply” Sec 65B (52) {Chapter V Extends to whole of India except J&K)


  • Place of Provision of Service Rules,2012 (PPS, Rules) notified u/s 66C


Determination of Place of Provisions of Service


  • “Place of provision of service” (PPS) Rules are provided by Sec 66C


  • Establishments of a person inside and outside TT are treated distinctly from each other [Sec 65B(44)(Expl.2)] {Relevant for taxability as imports}


  • Compliance procedures like registration formalities, filing of returns, etc. will be dependent on “location” as determined by the PPS Rules.


Relevance of PPS, Rules

  • Rules provide for place of taxability of a taxable service provided in taxable territory or otherwise.


  • Whether services liable as imports- taxable as reverse charge


  • Whether  services are eligible for exemption by fulfilling condition of export


  • Whether services provided to and availed from a) J&K and b) SEZ


Location of Service Provider / Receiver


One of the necessary conditions in determining PPS is finding the “Location of Service Provider/ Service Receiver” as the case may be.


  1. Registered Premises of SP/ SR


  1. If not as per 1) above then


  1. Location of Business establishment (BE)  [Place where decision making is located, say headquarters]  from where services are provided/ used or


  1. If services provided / used from/in establishment other than BE, then such other Fixed establishment [Place where resources are available to provide/ receive service] or


  1. If service provided from more than  one establishments- Location of Establishment most directly concerned with service provision/ use of service or


  1. Usual Place of Residence(UPR)


  1. In case of body corporate-Place where it is incorporated]
  2. Others-Where individual spends most of the time
  3. Telecom: Billing address of user is Usual place


Place of Provision of Service


Rule No.

Nature of Service



Place of Provision of Service



If SR location NA, then location of SP

Location of SR [Customer, Client]


Performance Based

TV Repair

Rule NA to Temporarily imported goods

a) Service of Goods:
Physical location of goods serviced

Beauty treatment


b) Service of Persons:
Physical location of Person serviced

Modeling agency receiving beauty treatment services for its models


c) Service of Persons:
Service received by a person on behalf of actual receiver


Immovable Property

• Services of enjoyment of property like Renting,
• Services physically performed on property like construction
• Services with objective for value addition, development, maintaining like architect, management, security

The services need to be related to particular immovable property(ies) to be covered under this rule

Location or intended Location of Immovable Property



Admission, organization of events, ancillary services


Place where event is held


Multi Locational Service

Testing of a new product in various parts of India and abroad

Services provided at more than one location

Place in TT where greatest proportion of service is provided


SP and SR [both] in TT

Irrespective of whether service provided in or outside TT

Mega Exemption to services where location of SP and SR [both] is outside TT

Location of SR


Specified Services

Location of SP

1. Banking and Financial Services

To account holders

2. Online database access

Online information and database access or retrieval service

3. Intermediary service:

One who arranges for or facilitates provision of service between two or more persons

Exclusion a) Intermediary in respect of goods b) Person providing service on his own

4. Hiring of "means of transport"

Upto one month


Goods Transport

Rule does not apply to goods sent through courier

Place of destination of goods

Exception: GTA Service, PPS is "location of person liable to pay tax"


Passenger Transportation Service

Point of Embarkation


Services provided on board Conveyance

Services like movies, music, beauty treatment etc supplied for charge

Covers Services provided on aircraft, vessel rail, bus

First scheduled point of departure



Empowers CG to  notify rules as required


Order of Application of Rules

Cases where more than one rule merits equal consideration

"Rule which occurs later"


Applicable Date: 1st Jul-12