Service tax leviability on Testing and analysis charges recovered from Foreign buyers.

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..... Service tax leviability on Testing and analysis charges recovered from Foreign buyers.
Query (Issue) Started By: - samiuddin ansari Dated:- 13-4-2018 Last Reply Date:- 16-4-2018 Service Tax
Got 6 Replies
Service Tax
Hello Good morning, My query is whether service tax is chargeable on income received from Foreign parties in Euro for the processing charges i.e Testing and analysis char .....

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..... ges made on goods supplied to foreign supplier. Since, services were performed in India i.e. taxable territory and customer situated in foreign territory i.e non-taxable territory. whether service tax is leviable on such income. As CERA audit team is emphasising for payment of service tax alongwith interest and penalty. We solict your valuable guidance in to the matter at the earliest. Thanks wit .....

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..... h regard. Reply By KASTURI SETHI: The Reply: Dear Querist, You can infer on your own on the basis of this judgement. Read carefully para No.5 of the judgement appended below:- (NOT in your favour) 2017 (5) G.S.T.L. 209 (Tri. - Mumbai) Reply By Rajagopalan Ranganathan: The Reply: Sir, You have stated that Testing and analysis charges made on goods supplied to foreign supplier. this means th .....

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..... at the service provided with respect to export goods. The service provided by you is an input service for export of goods. Therefore no service tax is payable on input service used for export of goods. This is my view. Reply By YAGAY AND SUN: The Reply: In this matter the place of provision of service is within India which is a taxable territory and even if you got remittances in EURO, the servi .....

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..... ce tax is required to be paid. Reply By KASTURI SETHI: The Reply: Para no. 5 of the cited judgement also says so. Reply By Ganeshan Kalyani: The Reply: I agree with the views of Sri Rajagopalan Sir. Thanks. Reply By KASTURI SETHI: The Reply: As per Rule 4 (a) of Place of Provision of Service Rules, 2012, the place of provision is taxable territory i.e India (Location where services are act .....

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..... ually performed). Hence this case is covered by Rule 4(a) for the purpose of Service Tax in the Pre-GST era.
Discussion Forum - Knowledge Sharing .....

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