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TMI Blog2019 (10) TMI 788X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Notification No. 11/2017 - Central Tax (Rate) dated 28.06.2017 and hence is liable to tax at 9% under the CGST Act. Similarly it is also liable to tax under Karnataka Goods and Services Tax Act 2017 at 9% as per clause (ii) of entry no. 21 of the Notification (11/2017) No. FD 48 CSL 2017 dated 29.06.2017. But if it is an inter-State transaction, it would be liable to tax at 18% under clause (ii) of entry no. 21 of the Notification No. 8/2017 -Integrated Tax (Rate) dated 28.06.2017. Time of supply in relation to the transaction - HELD THAT:- The time of supply would have to be determined as per the provisions of sub-section (2) of section 13 of the CGST Act, 2017. Regarding the value of the supply of services, the amount received by the applicant in relation to the services provided both directly and indirectly would be the value of supply of services. This would also include the amount of consideration reimbursed by the company to the applicant in the form of expenses incurred by the applicant, which will also form the consideration. - KAR ADRG 64/2019 - - - Dated:- 20-9-2019 - SRI. HARISH DHARNIA, AND DR. RAVI PRASAD M.P. MEMBER Represented by: Ms. Roopashi Kha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o make a presentation of the various categories of distribution transformer components and accessories offered by the company. The company specifies the presentation and the technical details of the aforementioned products. d. The applicant reports to a Sales Manager based in the office of the Company in Europe. The applicant is required to report the status of the sales development (with customers in the Middle East and Indian Markets) to the Sales Manager based in the European Office on a weekly basis. e. The Company conducts an annual meeting with all independent regional sales managers for the purpose of reviewing the future investments of the Company, cash flow and orders received by the Company as well as the new products being developed by the Company. f. The customers approached by the Applicant place their orders for the products with the Company and make payments to the Company s account. The Applicant does not raise any invoice for the products ordered by the said customers. g. The applicant is paid lump-sum compensation on a monthly basis for the aforementioned services. The applicant does not raise any invoice to the Company for the said services. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... services must be made or agreed to be made for a separate consideration in order to be taxable under the said Act. Since the applicant does not provide aforementioned services for a separate consideration and only receives a salary as well as reimbursement of expenses incurred during his activities performed for his employer, the aforementioned services are not subject to the charge of GST under the Act. 7. It is also submitted by the applicant that in terms of section 22 of the Act, suppliers that are making taxable supplies in terms of the Act are liable to be registered under the Act. Since the applicant is not making a taxable supply in terms of the Act, he is not liable to be registered in terms of the said provision of the Act. PERSONAL HEARING: / PROCEEDINGS HELD ON 30.08.2018. 8. Ms. Rupashri Khatri, Advocate and duly authorised representative of the applicant appeared for personal hearing proceedings held on 30.08.2018 reiterated the facts narrated in their application and also made the following written submissions inter alia stating as under: a. That the copies of the returns under Income Tax Act of the applicant for the Assessment year 2017-18 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el and entertainment, office needs and other business related expenses would be borne by the Company. The last line states We are very much looking forward to your formal acceptance . There is a written words Accepted the offer and signed by the applicant. There is no formal letter of appointment from the company. Further, in the statement of facts, the learned representative has stated that there is no further agreement between the applicant and H-J Family of Companies other than the aforesaid letter. (b) The Return of Income Tax filed by the applicant for the Assessment Year 2017-18 shows clearly that applicant has declared the income as Income from Business or Profession and not as Income from Salary . (c) There is no evidence of M/s H-J Family of Companies operational in India and the applicant has admitted that as per his knowledge goes the company does not have any physical presence in India. But the copy of the brochure of M/s H-J Family of Companies, submitted shows that the Company is having a branch office at Mysore and that Sri R. Santosh (applicant) is the regional Sales Manager, Middle East and India. (d) This gives some questions whether the appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould be applicable even under the CGST Act, 2017. In view of the above, the applicant is providing management services in marketing as an intermediary with a HSN Code of 9983 11. 9.5 Regarding the next question relating to whether the applicant is liable to be registered under the CGST Act, the answer is yes for the following reasons: 1. The applicant is providing services which are taxable and 2. The amount of consideration received is more than the threshold. 3. As per the notification no. 11/2017 - Central Tax (Rate) dated 28.06.2017, the entry no. 21 reads as under SI.No. Chapter. Section or Heading Description of Service Rate (per cent.) condition 21 Heading 9983 (Other professional, technical and business services) (i) Selling of space for advertisement in print media. 2.5 - (ii) Other professional, technical and business services other than (i) above 9 - 4. The nature of service rendered by the applicant, if it is a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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