Where is place of provision

This query is : Open

CA Rajnish (Querist)
Follow

22 April 2014 An India company engaged in Providing IT/Web Securities as follows:

Resources in India are accessing websites of Foreign companies through VPN(Virtual Private Network) or they are using remote access to monitor the websites of foreign Companies so as to prevent them from hackers and all.

Please tell me where is the Place of Provision of Services in this case. Please quote any case law or live case study so as to substantiate the same.

Sandeep Mangal Agarwal

Sandeep Mangal Agarwal (Expert)
Follow

22 April 2014 Dear Rajnish ,

Rule 9 of the PoS Rules states that for the following services:

++ Services provided by a banking company, or a financial institution, or a non- banking financial company, to account holders;

++ Online information and database access or retrieval services

++ Intermediary services;

++ Service consisting of hiring of means of transport, up to a period of one month.

the place of provision of service shall be the location of the service provider.

So in your query Indian company location is place of provision of Service.

Till now i am not aware of any case law on such case.

Thanks,

CA Rajnish

CA Rajnish (Querist)
Follow

24 April 2014 Dear Sandeep,

Thanks for the clarification.

But still, a doubt is hovering around my mind.
As per the definition from Service Tax Provision “online information and database access or retrieval services” means providing data or information, retrievable or otherwise, to any person, in electronic form through a computer network;.

In this we are not providing mere data or information but we are performing some tests so as to check how much prone Clients/Customers' Database,websites etc are prone to hackers.

Should not Rule 4(a) be applied?? which says: The place of provision of following services shall be the location where the services are actually performed, namely:-
(a) services provided in respect of goods that are required to be made physically available by the recipient of service to the provider of service, or to a person acting on behalf of the provider of service, in order to provide the service:
Provided that when such services are provided from a remote location by way of electronic means the place of provision shall be the location where goods are situated at the time of provision of service.

So in our case we are performing tests on websites/database by remote access from India but these websites/database must be located on servers which are outside India.

Please let me know if my understanding is wrong.

Upgrade to CAclubindia Pro. Subscribe Now!