Comission agent located outside india

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

11 March 2017 We are a manufacturer located in Maharashtra. We are receiving Sales order from Commission agents located in Sri- Lanka.

Our Commission agents doing marketing for us and gives order for supply in various country like Canada, Australia etc. Purchase order is directly received from customer to us (in the name of manufacturer). We are paying commission to commission agent as percentage basis. We are supplying (export) direct to customer.

In this case Commission Charges Paid to commission agents.will attracts gst on it? (or it is a import of service) & GST is paid on Reverse Charge Basis & claim the ITC. Please explain

Guest

Guest (Expert)

18 March 2017 Do you want answer as per current provisions or under GST?

Rajesh Kumar

Rajesh Kumar (Expert)

03 April 2017 As per current Service Tax laws, place of provision of services in case of intermediaries is location of the intermediaries. In the present case the intermediary is located outside India, and hence Service Tax is not attracted.
Under proposed GST regime, we need to fild the place of supply of service as per provision of Chapter V of the IGST Bill. As location of service provider is outside India, Section 13 of the IGST Bill is applicable. As per clause 8(2) of Section 13, place of supply shall be location of service provider, that is Sri Lanka. Import of services happens only when the place of supply of service is India [Section 2(11) of the IGST Act]. Thus it does not appear that the present transaction shall be taxable under proposed GST regime. However, many rules are yet to come and it shall be necessary to examine the issue once all rules, regulations are notified.

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