9911796707
TMI Blog2016 (7) TMI 1209X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant on these services is not legally sustainable. Regarding manpower recruitment and supply agency service - deputation of employees - Held that:- The reimbursement amount paid by the appellant to the foreign companies is relating to the cost of salaries and wages of the employees working under the appellant. In CCE vs. Computer Sciences Corporation India Pvt. Ltd.(2014 (11) TMI 125 - ALLAHABAD HIGH COURT) the Tribunal held that for tax purposes the service provided must be by a manpower recruitment agency and such a service has to be in relation to supply of manpower. In CCE vs. Arvind Mills Ltd. (2014 (4) TMI 132 - GUJARAT HIGH COURT), the Hon’ble Gujarat High Court held that deputation of employees from one company to another does ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en various operations in India pursuant to the agreement with foreign companies. The second point is regarding non-payment of service tax under the category of manpower recruitment or supply agency service w.r.t. certain employees who were seconded to the appellant by the foreign companies. The service tax liability of ₹ 10,60,90,293/- and ₹ 3,61,77,248/- respectively were demanded from the appellant covering the period 2006 to 2011. On conclusion of the proceedings, the Original Authority confirmed the demand of the said amounts and imposed penalty of equivalent amount under Section 78 of the Finance Act, 1994 alongwith penalties under Section 77 (1) and 77 (2) of the said Act. 2. The learned Counsel for the appellant submit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (iii) Gap International Sourcing (India) Pvt. Ltd. vs. Commissioner reported in 2015 (37) S.T.R. 757 (Tribunal). (4) for the period post 27/2/2010 the appellants fulfilled the conditions for export of service and there is no dispute in this regard. The service has been provided to a recipient located outside India and payment has been received in convertible foreign currency ; (5) regarding service tax liability under manpower recruitment and supply agency service, the appellants have not availed any service of such taxable category during the impugned period. The foreign companies [Airbus S.A.S., Astrium U.K. and Astrium] are not engaged in the business of supplying manpower to other companies. They do not fall under the category ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upported the findings of the lower Authority. 4. We have heard both the sides and examined the appeal records. On the first issue regarding tax liability of the appellant under BAS, a perusal of the general services agreement indicates the nature of service provided by the appellant to the foreign companies. These are mainly relating to research, collection and analysis of information in India, planning business analysis, giving advice, coordination, permission of products, representing foreign companies in the events and seminars etc. The admitted fact is that the foreign companies with whom the appellant entered into agreements do not have any office in India. These activities carried out by the appellant where services which are actua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not the person affected by the performance of the service. Thus, when the person on whose instructions the services, in question, has been provided and is located abroad, the destination of services, in question, has to be treated abroad. The destination has to be decided on the basis of place of consumption, not the place of performance of service in case of Business Auxiliary Service. In Microsoft Corporation (I) Pvt. Ltd. vs. CST, New Delhi reported in 2014 (36) S.T.R. 766 (Tri. Del.), the Tribunal held that the Business Auxiliary Services of promotion of market in India for foreign company amount to export of services. The Export of Services Rules, 2005 is considered as destination based consumption tax in accordance with declaration of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on is being paid for obtaining manpower supply service from the foreign companies. The reimbursement amount paid by the appellant to the foreign companies is relating to the cost of salaries and wages of the employees working under the appellant. In CCE vs. Computer Sciences Corporation India Pvt. Ltd. (supra) the Tribunal held that for tax purposes the service provided must be by a manpower recruitment agency and such a service has to be in relation to supply of manpower. In CCE vs. Arvind Mills Ltd. (supra), the Hon ble Gujarat High Court held that deputation of employees from one company to another does not involve profit or finance benefit there is no relationship of agency and client involved in such deputation. In Volkswagen India Pvt ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
