23 July 2012
If a chartered accounatant in INDIA gives advicory services to client, who is in London..This is export of service or outside taxable territory hence not Taxable. If the same client comes to INDIA and takes consultincy services from CA..(services provided within taxable territory)Will it be charged to service tax..?
23 July 2012
In both the instances it is exigible to service tax. In the first case by reverse charge and in the second case direct charges. (Subject to however, the limit of 10Lakh)
24 July 2012
Notification No. 28/2012-Service Tax, dated 20.06.2012. These Rules came into effect from 01.07.2012. These rules are meant for persons who deal in cross border services. These rules replaced the ‘Export of Service Rules, 2005’ and ‘Taxation of services (Provided from outside India and received in India) Rules, 2006. The service providers operating within India from multiple locations without having centralized registration will be found useful in determining the precise taxable jurisdictions applicable to their operation with the help of these Rules. The rules will be equally relevant for determining services that are wholly consumed within a SEZ, to avail the outright exemption.
A service should be taxed in the jurisdiction of its consumption. According to these Rules a place of provision of service shall be the location of the service receiver. In case the location of service receiver is not available in the ordinary course of business then the place of provision of service shall be the location of service provider. Rule 2(i) defines the terms ‘location of service receiver’ as-
(a). where the recipient of service has obtained a single registration, whether centralized or otherwise, the premises for which such registration has been obtained;
(b). where the recipient of service is not covered under sub-clause (a):
(i) the location of his business establishment; or
(ii) where services are used at a place other than the business establishment, that is to say, a fixed establishment elsewhere, the location of such establishment; or
(iii) where services are used at more than one establishment, whether business or fixed, the establishment most directly concerned with the use of the service; and
(iv) in the absence of such places, the usual place of residence of the recipient of service.
For the purposes of Rule 2(h) and Rule 2(i), “usual place of residence” in case of a body corporate means the place where it is incorporated or otherwise legally constituted. . For the purpose of clause (i), in the case of telecommunication service, the usual place of residence shall be the billing address. The ‘telecommunication service’ is defined under Rule 2(q) that means service of any description (including electronic mail, voice mail, data services, audio text services, video text services, radio paging and cellular mobile telephone services) which is made available to users by means of any transmission or reception of signs, signals, writing, images and sounds or intelligence of any nature, by wire, radio, visual or other electro-magnetic means but shall not include broadcasting services.
Therefore Service tax will not be attracted in my case. Am i right?
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