Service tax on services proived abroad by a indian co.

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Querist : Anonymous

Querist : Anonymous (Querist)

11 July 2013 Please guide, whether services provided by a Indian compnay in other country are taxable under service tax rules.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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12 July 2013 It is exempted if you satisfied the condition under place of service rules and export of service rule 6A

W.e.f. 1.7.2012, vide Notification No. 36/2012-St dated 20.6.2012, Rule 6A has been inserted in Service Tax Rules 1994, which stipulates as to what shall comprise export of services. Accordingly, the provision of any service provided or agreed to be provided shall be treated as export of service when,—

(a) the provider of service is located in the taxable territory,

(b) the recipient of service is located outside India,

(c) the service is not a service specified in the section 66D of the Act,

(d) the place of provision of the service is outside India,

(e) the payment for such service has been received by the provider of service in convertible foreign exchange, and

(f) the provider of service and recipient of service are not merely establishments of a distinct person in accordance with item (b) of Explanation 2 of clause (44) of section 65Bof the Act.

According to Place of Provision of Service Rules, 2012, "location of the service provider" means—

(a) where the service provider has obtained a single registration, whether centralized or otherwise, the premises for which such registration has been obtained;

(b) where the service provider is not covered under sub-clause (a):

(i) the location of his business establishment; or

(ii) where the services are provided from 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 provided from more than one establishment, whether business or fixed, the establishment most directly concerned with the provision of the service; and

(iv) in the absence of such places, the usual place of residence of the service provider.

According to Place of Provision of Service Rules, 2012, "location of the service receiver" means:—

(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.

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Querist : Anonymous

Querist : Anonymous (Querist)

13 July 2013 Thank you sir for detailed reply.

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