Services by Government or a local authority is covered in Negative list


  • services by the Department of Posts by way of speed post, express parcel post, life insurance, and agency services provided to a person other than Government;
  • services in relation to an aircraft or a vessel, inside or outside the precincts of a port or an airport;
  • transport of goods or passengers; or
  • Support services  Any Service , other than services covered above, provided to business entities;




All kinds of government and local authorities covered.

Government means Central Government and State Government.

Local Authority means Municipal Authority/Panchayat/Cantonment Board Etc



However there are 4 exceptions, Lets study these one by one


1.Services by the Department of Posts

Folllowing services are taxable

  • Speed Posts
  • Express parcel posts
  • Life insurance (Postal life insurance and Rural Postal life insurance)
  • Agency Services (like collection of telephone/electricity bills/distribution of mutual funds, Passport services)


Following services are not taxable

  • Basic Mail Service (like as post card, inland letter, book post, registered post)
  • Money transfer Service 


2. Services in relation to an aircraft or a vessel,

  • All services related to aircraft or vessels are taxable
  • It does not matter whether services are rendered within port or outside port



3A. Transport of passengers;

Following services are taxable

  • Transport of passengers by railways in first class or AC Coach
  • Radio Taxis

Following Service are not taxable

  • Transport of passengers by railways (other than in first class or AC Coach)
  • Transport of passengers by metro, monorail or tramway
  • Transport of passengers by inland waterways
  • Transport of passengers by a stage carriage (vehicle carrying more than 6 passengers like roadways bus)
  • Metered Cabs or Autorickshaws (except Radio Taxis)
  • Transport of passsengers in vessel which is not predominantly for tourist purpose(if some people go for tourist purpose, still It will be covered in negative list and hence not taxable)


Services of transport of passengers by a contract carriage for transportation of passengers, excluding tourism, conducted tours, charter or hire is also exempt as per Mega Exemption list



3B.Transport of Goods

Following are covered in negative list

Road transport (Except Goods Transport and Courier)

Services by way of transportation of goods by inland waterways:

Services by way of transportation of goods by an aircraft or a vessel from a place outside India up to the customs station of clearance in India:


However following are taxable

  • Courier Agency
  • Goods transport Agency


Support   AnyServices provided to Business Entities are taxable (NEW AMENDMENT)

These include services like

Infrastructural, operational, administrative, logistic, marketing or any other support service

These services are taxable for private enterprises,

hence these are taxed for government also so that private sector gets a level playing field



Effects of Amendment

Earlier only support services provided to business entities were excluded from Negative List

Now ALL SERVICES provided to business entities are excluded

(This amendment is effective from a date to be notified)


Definition of Government (NEWLY INSERTED)

“Government means the

Departments of the Central Government, a State Government, a Union territory

and its Departments

but shall not include

any entity, whether created by a statute or otherwise, the accounts of which are not required to be kept in accordance with article 150 of the Constitution or the rules made thereunder”.


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CA Maninder Singh

CA Maninder Singh is a Chartered Accountant for the past 14 years. He also provides Accounts Tax GST Training in Delhi, Kerala and online.