In compliance of the
provisions contained in Finance Bill 2012 and subsequent notifications
issued by Ministry of Finance, the Service Tax in case of railway
travel, which was exempted upto 30th September 2012, will be levied on
the fare of passenger services in the following classes from 1st October
(i) AC First Class, (ii) Executive Class, (iii) AC-2 tier Class, (iv)
AC-3 tier class, (v) AC Chair Car class, (vi) AC Economy class and (vii)
Since an abatement of 70% has been permitted on passenger services by
Ministry of Finance, the Service Tax will be charged on 30% of total
fare including reservation charge, development charge, superfast
surcharge which would be calculated as follows:-
i) Service Tax of 12% will be charged on 30% of fare (equivalent to 3.6%
on the total fare)
ii) Education Cess of 2% on Service Tax will be added (equivalent to
0.072% on total fare) and
iii) Higher Education Cess of 1% on Service Tax will also be added
(equivalent to 0.036% on total fare)
iv) Total Service Tax implication will be (i)+(ii)+(iii)=3.708% on the
On Concessional value tickets/PTO tickets etc. service charge will be
levied on 30% of the total fare actually being paid by the passengers.
The Service Tax will also apply to tickets issued in advance for
journeys to commence on or after date of implementation of Service tax.
In the case of tickets already issued excluding service tax, the service
tax on total fare including development charge, superfast surcharge,
reservation fee, etc. date of implementation of Service Tax will be
recovered either by TTEs in the train or by the Booking Offices before
commencement of the journey by the passengers. Commercial Inspectors and
TIAs have been instructed to visit all important stations and ensure
that service tax is levied on tickets issued as per the revised rates.
Commercial Officers have also been asked to make surprise checks at the
stations and ensure that Service Charges are levied from date of
implementation of Service Tax.
The amount of Service Tax collected from passenger will be deposited
with the Ministry of Finance as per procedure. Finance Departments of
Zonal Railways have been instructed for proper accountal and remittance
of Service Tax amount to the Government.
In case of refund of passenger fare, if any, refund of Service Tax shall
be claimed by the passenger from the concerned Service Tax authority. No
refund shall be made by the Railways on this account. For the purpose of
claiming refund, Chief Commercial Manager (CCM) office of concerned
Zonal Railway shall issue a certificate to passenger detailing the
amount of refunds to be signed by an Officer authorized by CCM, which
shall be countersigned by the Dy. Chief Account Officer (DCAO) or
officer authorized by them for this purpose.