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 Management, Maintenance or Repair Services Minimize
 
Definition and Meaning
Section 65(105) (zzg) - ‘Taxable Service’ means any service provided or to be provided to any person, by any person in relation to management, maintenance or repair.
 
Levied
Services Provided Services provided or to be provided
01.07.2003 16.06.2005
 
Essential Ingredients
Services are provided or to be provided to any person.
Services are rendered by any person. Section 65(48)- “Franchisor" means any person who enters into franchise with a franchisee and includes any associate of franchisor or a person designated by franchisor to enter into franchise on his behalf and the term "franchisee" shall be construed accordingly.
The services shall be in relation to management, maintenance or repair. Section 65(64) - Management, Maintenance or repair" means any service provided by—
 
Any person under a contract or an agreement or
A manufacturer or any person authorised by him, in relation to,-
For, or on behalf of, the client.
(a)  Management of properties, whether immovable or not
(b)  Maintenance or repair of properties, whether immovable or not or
(c)  Maintenance or repair including reconditioning or restoration, or servicing of any goods, excluding a motor vehicle
  Explanation.- For the removal of doubts, it is hereby declared that for the purposes of this clause,-
(a)  "Goods" includes computer software
(b)  "Properties" includes information technology software
Section 65(53a) - "Information technology software" means any representation of instructions, data, sound or image, including source code and object code, recorded in a machine readable form, and capable of being manipulated or providing interactivity to a user, by means of a computer or an automatic data processing machine or any other device or equipment
 
Person Liable to make payment of service tax (Service provider/ service recipient)
Any person providing the service would be liable to pay the service tax as service provider under the Act.
 
Abatement (If Any)
No abatement has been granted to any person liable to pay service tax under the Section.
 
Import of Services
Where the taxable service is provided from outside the country, the recipient of service would be treated as deemed service provider under the reverse charge mechanism and would be liable to apply for registration for paying tax on imported services. Rule 3 of Taxation of services (provided from outside India) Rules, 2006 classifies taxable services into three categories. The Management, maintenance or repair services falls in the second category ie., ‘When the service is performed in India.’ (Rule 3 (ii))
 
Notifications / Circulars
Circular No 59/8/2003, dated 20.06.2003 - In cases of maintenance contracts entered into for a period of more than one year prior to 01.07.2003, exemption has been provided to that part of the value of the service for which bill have been raised and the amount has actually been received prior to the 01.07.2003. similar would be situation for payments made for continuing services. Further, services provided during warranty period by the dealer would attract service tax on the amount received by the dealer for such services.
Circular No 65/14/2003, dated 05.11.2003 - By Continuing services it was meant continuing maintenance services where there is an ongoing contract under which regular periodical payments are made.
Notification No 20/2003-ST, dated 21.08.2003 (Withdrawn w.e.f. 09.07.2004) - Exemption to repair and maintenance of computers, computer systems or computer peripherals from levy of service tax.
Circular No 70/19/2003-ST, dated 17.12.2003 (Rescinded w.e.f. 09.07.2004 vide Notification No 7/2004-ST, dated 09.07.2004) - Maintenance of Computer Software is not subjected to service tax under this category.
Board’s Circular No 74/4/2004-ST, dated 23.01.2004 - ATM machines are not computers and hence there maintenance or repair does not fall under the exemption Notification No 20/2003-ST, dated 21.08.2003 and hence are accordingly chargeable to service tax.
Circular No 81/2/2005-ST, dated 27.10.2005 - Service provided in relation to maintenance or repair of software is liable to service tax.
Circular No.96/7/2007-ST, dated 23.08.2007 -
 
Reference Code Issue Clarification
053.01 / 23.08.07 Services provided by any person to a customer in relation to management, maintenance or repair is liable to service tax section 65(105)(zzg). "Management, maintenance or repair" includes maintenance or repair of any goods, excluding motor vehicle [section 65(64)].

Whether maintenance or repair of software is liable to service tax?
Explanation to section 65(64) provides that "goods" includes computer software.

Since, maintenance or repair of any goods is liable to service tax, services provided in relation to maintenance or repair or servicing of computer software is liable to service tax under "management, maintenance or repair" service section 65(105)(zzg).
 
Case / Judgement
Tech Aids Vs CCE - Bringing old cylinders to its original workable and usable condition so that the same could be put to use by the industry is a service provided and taxable under the category of Maintenance and repair services.
Tata Consultancy Service Vs State of A.P. - The Apex court held that the software programmes such as Oracle/lotus/unigraphics are sold off the shelf as goods and hence are covered under the definition of goods.
 
 
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