Exempted services, money received hy holding company
This query is : Resolved
Ravi Chandra Prakash
(Querist)
27 April 2009
X Pvt Ltd., is engged in Export services, hence the services are exemted from levy of Service Tax. The remmitances from customers towards the services in USD are directly deposited in to 80% holding compnay's Bank account. Towards the repayment of loan taken from Holding Company.Is there any problem in the point of view of Service tax, since the money is not dierectly received by X Pvt Ltd.
Madhukar N Hiregange
(Expert)
27 April 2009
There could be an dispute. Last year Tribunal held that as long as the payment is made on account of a foreign exchange outgo, the same should be considered as suffiicent discharge.
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