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This query is : Resolved

venu (Querist)

18 August 2009 Dear All,

A Pvt Ltd company (STPI Unit) engaged in the business of market research (service tax classification - market research agency - sec65(105)(y))is obtaining market research services from service providers situated outside india. The company receives service from foreign service providers to use it as input service for providing the service to foreign clients. Is the company liable to pay service tax on import of service?

thanks

Madhukar N Hiregange

Madhukar N Hiregange (Expert)

19 August 2009 Market research under the Payments to NR ( Import of services ) Rules 2006 is a performance based service. If part ofthe service provided by trhe servic eprovider is in India then the same is liable. If no part of the service is in India then there is no liability under sec 66A for the STPI.
STPI are not exempted from reverse charge due to the fact of export., however can claim the refund if ST paid.

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