Charge of rcm on recruitment and placement agency

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 September 2014 SIR I WANT TO KNOW WHETHER REVERSE SERVICE TAX SHOULD BE CHARGED ON RECRUITMENT AND PLACEMENT AGENCY OR IT SHOULD BE CHARGED ONLY MANPOWER SUPPLY AGENCY AND. I ALSO WANTS TO KNOW THE DIFF. B/W THE TWO WORDS

1) MANPOWER SUPPLY

2) RECRUITMENT AND PLACEMENT AGENCY

WHETHER THE DEFINITION OF THE BOTH IS SAME IN SERVICE TAX OR IS THERE ANY DIFF. INTO THEIR DEFINITION. PLEASE CLARIFY AS SOON AS POSSIBLE

Annu Agarwal

Annu Agarwal (Expert)
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18 September 2014 Reverse charge on Service tax is applicable only on supply of manpower .
Supply of manpower is different from service of recruitment agency.

The Manpower Supply service is understood to mean when
-one person (i.e the service provider) provides to another person(i.e the service receiver)
-with one USE of one or more individuals(i.e the manpower)
-who are contractually EMPLOYED or ENGAGED by the service provider.
Also as per Rule 2(g) of Service Tax Rules “supply of manpower” means supply of manpower,temporarily or otherwise ,to another person to work under his SUPERINTENDENCE or CONTROL.(Circular No. 354/127/2012 dated 27.07.2012 )

Whereas The manpower recruitment is defined as any service provided to a client(i.e the service receiver) by a manpower Recruitment Agency in RELATION to the RECRUITMENT of candidates(i.e the manpower) in any manner.(Clarification of Trade Notice No. 53 CE (ST) 97/ dt .4.07.1997 issued by Central Excise Commissioner ,New Delhi.)