Service tax applicability

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 February 2011 Dear Sir,

Iam working in IT infrastructure company we have deputed 1 employee in Mozambique under consultant per month 1.50lkhs now his income is crossing 10lakhs as per service act tax will be applicable, we are asking him to get registration and submit us the bill but he is deniying that, is there any option to avoid service tax remove him as consultant and he is not interest to pay IT more than 10%. Please suggest me its very urget.

CA Unnikrishnan Nair N

CA Unnikrishnan Nair N (Expert)
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18 February 2011 This 1.5lakhs, is it the amount given by your company to him or amount given by the foreign client to your employee ?

Querist : Anonymous

Querist : Anonymous (Querist)

18 February 2011 1.5lkhs paying by our company everymonth as professional fees

CA Unnikrishnan Nair N

CA Unnikrishnan Nair N (Expert)
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19 February 2011 It appears that given service is classifiable under consulting engineer service and the same amounts to import of service in your hands. Hence the IT company in India is liable to service tax under reverse mechanism. But before conclusion, the correct classification has to be ascertained on a further examination of the nature of service.