Tax applicability of service tax

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

02 February 2016 Hello,

i have one question on service tax,
one of our client is locating in India and there another office is locating outside India.
now we have received Purchase order form outside India and we will send invoice to outside India but we will provide service in India.
do we have to charge Service tax to on Invoice.

Suresh Ramaswamy

Suresh Ramaswamy (Expert)
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02 February 2016 If any service not in the Negative List is rendered in India, it is subject to service tax - hence service tax is leviable.
For services rendered to non-resident service recipients exemption is available under "Export of Services Rules". To qualify as export of service three conditions are mandatory:
(1) The service provider is resident in India and the service recipient is a non-resident The service
recipient has no office, branch associate or recipient in the taxable territory.
(2) The service is rendered outside the taxable territory.
(3) The consideration is received in convertible foreign currency through proper banking channels.

If condition one is fulfilled and your overseas branch renders services abroad then you can claim exemption from service tax.