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Service tax

Divya (Studeny) (379 Points)

02 September 2014

Why Services rendered in J &K exempt from service tax but received from J&K(non taxable territory) taxable?Whereas services rendered to or received From Foreign(non taxable territory) are to be taxed in India?? plz help.

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3 Replies

Kishor Bhat (CA final CS executive (from Bangalore)) (1881 Points)
Replied 02 September 2014

Have u read place of provision of service rules,2012? Wat it says..service is taxable only when it is "provided or agreed to be provided in the taxable territory". So taxability of service wl be determined based on the place of its provision.

Kishor Bhat (CA final CS executive (from Bangalore)) (1881 Points)
Replied 02 September 2014

Answer for all ur doubts resides in the above definition. So export of service is nt taxable since it is provided in non taxable territory(outside india) and import of service is taxable since service is provided in india wch is taxable territory except jammu & kashmir. Hope it clarified.

Kishor Bhat (CA final CS executive (from Bangalore)) (1881 Points)
Replied 02 September 2014

In simple terms i can say taxability of service decided on "in which place we have provided the service"..whether in taxable territory or in non-taxable territory . So for J&K..its a non taxable territory. So it concludes service in J&K is not taxable and out of J&K is taxable since service provided in taxable terrority. Same rule applies on export n import of service.