SERVICE TAX ON PROCEESSING FESS BY FOREIGN BANK, Service Tax

[SNEHAL SHAH]

R/sir,

We have applied Term Loan from Foreign Bank Branch located at Japan & Processing fess for term loan paid in Foreign Currency 10000 US DOLLAR .

Is Service Tax Liability on this Processing fess on Indian Company ? if Yes please brief .

Advance thank for valuable reply .

Thanks and Regards,

SNEHAL SHAH

Posts / Replies

[Pradeep Khatri]

Yes, you are liable to pay the service tax under Reverse charge mechanism read with Place of provisions of services Rules.  Further, you may avail the CENVAT credit on the strength of the GAR-7 Challan.

[sanjeev bajaj]

Yes, it is service as the processing fee is not covered in negative list.

Agreed as it is payable on reverse charge mechanism.

 

(Sanjeev Bajaj)