Export of services

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C.A. LINESH PATIL (Querist)
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17 October 2010 Suppose i provide services in relation to immovable property which is located outside India.& i received consideration in Indian currency.

So my question is that whether this will tantamount to Export of Service under service tax export Rule 2005

Please reply as earliest possible.

Thanks in Advance

CA RAVI MANSAKA

CA RAVI MANSAKA (Expert)
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17 October 2010 It should be noted that according to Export of Service Rules, 2005, Services provided in relation to a immovable property which is located outside india, amount to export of service. However, it is the primary condition that export proceeds should be realised in foreign currency, therefore, in your case,export benefits shall not be available and service tax has to be paid.

C.A. LINESH PATIL

C.A. LINESH PATIL (Querist)
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17 October 2010 but i have book of author which says that if service is given in respect of immovable property which is situated out of india.it is irrelevant that consideration is received in indian currency to decide whether service is export or Not.

Please clarify

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Madhukar N Hiregange

Madhukar N Hiregange (Expert)
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18 October 2010 pl specify the services

CA RAVI MANSAKA

CA RAVI MANSAKA (Expert)
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18 October 2010 No,
As per Export of Service Rules, 2005, for all three categories of services, it is primary requirement, therefore, my view is same.

Abhay Gujarathi

Abhay Gujarathi (Expert)
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18 October 2010 Agree with CA Ravi.. In your case it is received in indian currancy so taxable

C.A. LINESH PATIL

C.A. LINESH PATIL (Querist)
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18 October 2010 suppose i provide design of the office to be made out side india.

and the same company has place of business in India.and payment is made to me in Indian Rs by Indian establishment.

CA RAVI MANSAKA

CA RAVI MANSAKA (Expert)
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18 October 2010 YES, IT WILL BE TAXABLE IN INDIA

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C.A. LINESH PATIL

C.A. LINESH PATIL (Querist)
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18 October 2010 earlier you said No.
can you please give reasoning as you said consideration must be received in Foreign currency.while in this case it is being received in Indian currency only.

Thanks
Plz reply

CA RAVI MANSAKA

CA RAVI MANSAKA (Expert)
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18 October 2010 I said 'No' with reference to your view and in my opinion, export proceeds should be realised in foreign currency only, otherwise, it will be taxable in India... You should read bare export of service rules, in which it is clearly mentioned... do not refer any author's book... which you are referring is giving incorrect view...

My earlier answers are same... read properly..

chamatkaribaba

chamatkaribaba (Expert)
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27 May 2011 If you do not receive consideration in convertible foreign exchange, the criteria of exports of services are not fulfilled. Therefore, it will be treated at par with Indian services and Service tax has to be paid on this.