02 August 2010
There is no concept as ‘import’ of service in the strict sense of the term in the Finance Act, 1994 or the rules made there under.
The word ‘import’ is used just to indicate service provided by a person who has established his business or has his permanent address outside India and the recipient of such service is such a person who has his permanent address or usual place of business in India.
Provisions made under section 66A of the Finance Act, 1994 provide for payment of service tax by the recipient of service in cases where the provider of taxable service is from outside India and the receiver of service has his permanent address / usual place of business in India. This is applicable even though the service is received / consumed by the such Indian outside India. This provision is not applicable in case of individuals who have received such service other than for the purpose of use in business or commerce. (Refer section 66A of the Finance Act, 1994)
In case where the service provider is a non-resident or is from outside India and does not have office in India, the person receiving the service shall be liable to pay the service tax, based on "Reverse Charge Mechanism of Srevice Tax".
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