Applicability of the provisions of the Export of Services Rules, 2005 in certain situations.

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..... on the expression "used outside India" in Rule 3(2)( a ) of the Export of Services Rules, 2005 as prevalent at that time. The condition specified in Rule 3(2)( a ) has since been omitted vide Notification 06/2010-ST, dated 27-2-2010. In the context of the stated Circular an issue has been raised, whether for the period prior to 28-2-2010 the requirement that the service should be "used out .....

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..... ocated outside India, is actually used in respect of a project or an activity in India the service cannot be said to be used outside India. 3. It may be noted that the words "accrual of benefit" are not restricted to mere impact on the bottom-line of the person who pays for the service. If that were the intention it would render the requirement of services being used outside India during the p .....

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..... e accrual of benefit and their use outside India are not in conflict with each other. The relation between the parties may also be relevant in certain circumstances, for example in case of passive holding/ subsidiary companies or associated enterprises. In order to establish that the services have not been used outside India the facts available should inter alia, clearly indicate that only the p .....

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