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[Reference Code] 999.02 / 01.07.07 [Issue] Department of Posts provides a number of services. What is the status of those services for the purpose of levy of service tax? [Comment] 
Following services provided by Department of Posts are not leviable to service tax. · Basic mail services known as postal services such as post card, inland letter, book post, registered post provided exclusively by the Department of Posts to meet the universal postal obligations. · Transfer of money through money orders, operation of savings accounts, issue of postal orders, pension payments and other similar services which are of the nature of banking and other financial services. Department of Posts also provides a number of services used predominantly for business or commerce which are also provided by other commercial organizations. Services such as courier services (Speed Post) Insurance Services (Postal Life Insurance), Agency or intermediary services on commission basis (distribution of mutual funds, bonds, passport applications, collection of telephone and electricity bills) fall under the category of services where Department of Posts is in competition with other similar service providers. Such category of services are liable to service tax under appropriate taxable services.
014 - Service Tax - Circulars - Year 2007 - Circular No.- 90 /1/2007, dated - 03-01-2007 - Applicability of service tax on international in-bound - Page 3
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