The correct answer is option 3: Residuary Powers under Article 248. According to the Indian Constitution, there are three lists that divide the legislative powers between the Central and State governments. These lists are known as List I (Union List), List II (State List), and List III (Concurrent List). The Union List contains subjects that only the Central government has the power to legislate on. The State List contains subjects that only the State governments have the power to legislate on. The Concurrent List contains subjects on which both the Central and State governments can legislate.

However, there are certain subjects that are not mentioned in any of these lists. These subjects fall under the residuary powers of legislation, which are exclusively given to the Central government. Article 248 of the Indian Constitution grants the Central government the power to legislate on these residuary matters. Therefore, under these powers, the Central government can impose the service tax and expand its scope.