Based on the Finance Bill 2016, power to arrest in service tax evasion is restricted to

1.         situations where the taxpayer has collected the tax, but not deposited it to the exchequer
2.         situations where the taxpayer has collected the tax, but not reported in books of accounts
3.         situations where the taxpayer has collected the tax, but not deposited above a threshold of Rs. 2 crore

Which of the statements given above are correct?

Statement 1: It is correct. Recently, Finance Minister announced withdrawal of tax exemptions from a host of services including those provided by lawyers to other advocates, including on arbitral tribunals, even as he exempted financial regulators and others from service tax. The Finance Bill 2016 proposes that the power to arrest in service tax evasion is being restricted only to situations where the taxpayer has collected the tax, but not deposited it to the exchequer. Statement 2: It is incorrect. Tax administration does not rely solely upon taxpayer declarations, business records, and books of account to determine tax liability, etc. Statement 3: It is correct. The Finance Bill 2016 also proposes that the power to arrest in service tax evasion is being restricted to situations where the taxpayer has collected the tax, but not deposited it to the exchequer, and that too above a threshold of Rs. 2 crore.