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Rule 4
Central Excise Officer (CEO) has the power to satisfy himself as to the accuracy of any information furnished or document presented for valuation.
If he is satisfied that the value so determined by the service provider is not in accordance with the provisions of the Act or these rules, he shall issue a notice to such service provider to show cause why the value of such taxable service for the purpose of charging service tax should not be fixed at the amount specified in the notice.
The Central Excise Officer shall, after providing reasonable opportunity of being heard, determine the value of such taxable service for the purpose of charging service tax in accordance with the provisions of the Act and these rules.
Procedure followed
- Check Accuracy of value
- If he feels value is not as per Act or Rules, he may issues show cause notice mentioning value
- Give opportunity of being heard
- Determines value
Exam Questions
Question 3
The value of taxable services determined by the person responsible to pay service tax cannot
be rejected by the Department. Examine the validity of the statement.
No, the statement is not valid. As per rule 4 of the Service Tax (Determination of Value) Rules,
2006, the value determined by the person responsible to pay service tax can be rejected by
the Central Excise Officer if he is of the opinion that the value determined by such service
provider is not in accordance with the provisions of the Finance Act, 1994 or these rules.
In such a situation, the Central Excise Officer shall issue a show cause notice and the service
provider would then be required to show cause why the value of taxable service should not be
fixed at the amount specified in such notice.
The Central Excise Officer, after giving such service provider an opportunity of being heard,
will determine the value of such taxable service in accordance with the provisions of the
Finance Act, 1994 and these rules.
