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TMI Blog2017 (9) TMI 1260X X X X Extracts X X X X X X X X Extracts X X X X ..... NEW DELHI], where it was held that There was no basis whatsoever to hold that in such a transaction, a taxable service involving the recruitment or supply of manpower was provided by a manpower recruitment or supply agency. Unless the critical requirements of clause (k) of Section 65(105) are fulfilled, the element of taxability would not arise. No taxable service involving recruitment or supply of manpower was provided - the amount reimbursed to foreign nationals/expats working with the assessee cannot be considered as the amount paid for rendition of manpower supply or recruitment agency - demand set aside - appeal allowed - decided in favor of appellant. - ST/3612 & 3611/2012 - A/61806-61807/2017-CU[DB] - Dated:- 21-7-2017 - Mrs. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ority, the appellant have filed these appeals. 2. Learned Advocate for the appellant submits a copy of Salary Reimbursement Agreement (SRA) dated 10.6.2003 signed between the assessee and Convergys Customer Management Group (CMG). He argued that SRA provides that there will be exist employee-employer relationship between the expats and the assessee. The assessee shall bear and pay foreign currency salary of the expats and CMG will pay it on on behalf of the assessee for administrative convenience only. He also drew attention to the agreement of the assessee with individual employee in which they have been offered appointment by the assessee. Form 16 of some these employees show deduction of income tax at source by Convergys India. Form s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the agreement has been signed between Convergys India Services Pvt.Ltd. and Convergys Customer Management Group Inc. We find that the CMG has released its employees to work exclusively for Convergys India and released employees shall work under the direction and supervision of the assessee and shall have an employer-employee relationship with the assessee. Neither impugned order nor the agreement with CMG establish that the foreign entity is involved in the business of manpower supply. The salary of the employees is borne by the Convergys India and it is only for administrative convenience that CMG is paying to its employees foreign currency on behalf of the assessee. It is clear from the agreement that such foreign currency salary reimb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the present case, facts are to the contrary. 6. Admittedly in this case, it is nowhere coming out from the show cause notice or from the finding of the lower authorities that the foreign company, who have deputed its employees, is manpower supply or Recruitment Agency. We also find that there is employer-employee relationship between the assessee and the deputed expatriate employees. In the case of Computer Sciences Coprn. India Pvt.Ltd. (supra), Hon ble Allahabad High Court has held as below: 8. In the present case, the Commissioner clearly missed the requirement that the service which is provided or to be provided, must be by a manpower recruitment or supply agency. Moreover, such a service has to be in relation to the sup ..... X X X X Extracts X X X X X X X X Extracts X X X X
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