No service tax to be levied on NRI remittances: Finance Ministry

New Delhi, July 10

The Finance Ministry today clarified that no service tax would be levied on NRI remittances from overseas.

The clarification by the Central Board of Excise and Customs (CBEC), which functions under the Finance Ministry, follows concerns over reports that there was a move to levy 12 per cent tax on money sent back home by Indians abroad under the changed service tax regime from July 1.

The CBEC said in a circular “that the matter has been examined and it is clarified that there is no service tax per se on the amount of foreign currency remitted to India from overseas”. In the negative list regime, “service” excludes transaction in money. As the amount of remittance comprises money, the activity does not comprise a “service” and is not subjected to service tax, the circular clarifies.

It further added that “in case any fee or conversion charges are levied for sending such money, they are also not liable to service tax as the person sending the money and the company conducting the remittance are located outside India. Such services are deemed to be provided outside India and thus not liable to service tax”.

It has been further clarified that even the Indian counterpart bank or financial institution which charges the foreign bank for the services provided at the receiving end, is not liable to service tax as the place of provision of such service is outside India.

The clarification will alleviate concerns of NRIs as India is one of the top recipient of remittances ($64 billion in 2011), according to the World Bank data. Given the dire need for dollar at a time when current account deficit is high and Rupee is under pressure, any move to levy service tax on NRI remittances would have been disastrous.

CMs of Punjab and Kerala, which are among the states receiving the largest remittances from NRIs, had taken up the matter with Prime Minister Manmohan Singh.

M Rafeeque Ahmed, president, Federation of Indian Export Organisations (FIEO), said that towards addressing the trade deficit, remittances were the single largest source of unconditional flow of foreign exchange into India, according to estimates by the World Bank. Given the slowdown and declining levels of foreign exchange, service tax could only act as a deterrent to precious incoming foreign exchange, he added.

He said the waiver of service tax on the same would ensure that this stable source of foreign exchange would continue to maintain the delicate balance of payments position of India at this moment of global crisis. 

WHY THE CLARIFICATION  Concerns were being expressed over reports that there was a move to levy 12% tax on money sent back home by Indians abroad under the changed service tax regime from July 1 THE FINAL WORD  The matter has been examined and it is clarified that there is no service tax per se on the amount of foreign currency remitted to India from overseas  As the amount of remittance comprises money, the activity does not comprise a “service” and is not subject to service tax  In case any fee or conversion charges are levied for sending such money, they are also not liable to service tax as the person sending the money and the company conducting the remittance are located outside India

Manpneet Kaur is crowned Miss Australia Punjaban 2012

Melbourne - Manpuneet Kaur Grewal a first year Accounting student at Melbourne's Deakin University, was crowned ‘Miss Australia Punjaban 2012’ at a well attended and appreciated event held here.  She has secured a place to compete with other contestants who will be representing other parts of the world and vying for the title of ‘Miss World Punjaban 2012’.

The main event is due to be held at Ludhiana in Punjab in November 2012.

Australian born Manpuneet Kaur, a 9’9” ‘Punjaban Mutiyar’ who resides in Melbourne and is studying commerce at Deccan University, impressed the judges with her beauty, knowledge and talent to bag the prestigious title.

Parminderjit Waraich from Brisbane finished Ist runner-up while Gagandeep Kaur from Melbourne was declared 2nd Runner-up.  

Ten beautiful Punjabans hailing from Melbourne, Brisbane and Sydney took part in the show organized by Sabhayachark Sath Punjab in association with South Pacific Institute.

The different rounds showcasing talent of the contestants were of immense interest to the audience. The contestants danced to the tune of Punjabi folk songs, displayed special talents and had a question-answer round where they were asked questions related to Punjabi Heritage.

Jagpreet bagged award for Best folk Dance, Ramandeep Kaur bagged award for being declared ‘Gunwanti Panjaban, Baljit Kaur was declared ‘Sughar-Syani Punjaban’ and Rajdip Kaur was conferred with ‘Gidhian di Rani’ sub-title. Amrit Kaur, Navjot and Semris were given special prizes.

Renowned Literary Personality Dr.Satish Verma who had specially flown from India, SBS Radio Anchor Manpreet Kaur and known Bhangra Expert Varinder Saran, were the judges at the event.

Gurvinder Singh Nagra welcomed the guests and audience while Harleen Sohana and Dr. Preetinder Grewal were the anchors for the show.

Teams of ‘Folk Art’, ‘Bhangra Rockers’, ‘Bhangra Federation’ regaled the audience with their performances. Parddeep Kaur, Poonam and their team members also presented Punjabi dance items. Charnamit Singh made the audience laugh with his comedy items.

Punjabi woman Roopak Kaur Sodhi who is the first Punjaban to be recruited in Victoria Police and ‘Singh Sabha Bhangra Group’ – contestants of ‘Australia has got Talent’ were specially honoured for their contribution towards the community.  They were awarded by Harbhajan Singh Khaira and Kanwalpreet Singh Sandhu.
Ajit Singh Rahi’s book ‘Teeja Ghallughara’ was released during the show.

Chairman-Director Jasmer Singh Dhatt told ‘Yes Punjab’ that those who contributed their best to make the show a success include Amardeep Singh, Manjot Kaur Dhaliwal, Amanpreet Singh, Upkar Singh, Gurpal Singh, Jaskunwar Singh.  

Others present include Prem Singh Khaira and Ruban Sohana from Sydney, Jasmel Singh Khaira, Gurpreet Singh Sangha, Sukhdeep Deol, Imtiyaz Khan and Ravi.
The event, fourth of its kind in Australia, hosted under the direction and supervision of Chairman-Director Jasmer Singh Dhatt at Monash University’s Robert Blackwood Hall with a capacity of 1100 was well received and well attended.

Jasmer Dhatt said that ‘Miss World Punjaban 2012’ beauty pageant has taken  a start with Australia event and now the  pageant is scheduled to  travel to Europe, America, Canada, New Zealand and Pakistan where such events shall select more Punjabi beauties to take part in the finals to be held at Ludhiana.