Recovery of expenses

CA Ganesh Karthik (Chartered Accountant) (368 Points)

09 May 2012  

 Hi Members..

 

Whether mere recovery of expenses can be treated as service?

 

I mean, in case of group companies, the expenditures are normally shared by them. Initially, an expenditure may be incurred by one company, which it may later on recover from the other group company..

In such case, there is no underlying services rendered by any company, but only a reimbursement (or recovery) of expenses..

Whether even such reimbursements attract service tax? If so, under what service?

 

Thanks in advance..