Nirmit Choraria (CA Final) (1333 Points)
28 July 2012What is export of service as per service tax...??
I provide service to a company in Honkong. But the consideration received is in Indian rupees. Whether my service is export of service and so i have no liabilty to pay service tax or the other way round..
CA student
(CA Final)
(404 Points)
Replied 28 July 2012
For being an export of service these conditions are to be cumulatively satisfied:- It must be a service as defined under sub-section 44 of section 65B • by a service provider located in the taxable territory • to a service receiver located outside India • the service is not a service specified in the negative list • the place of provision of the service is outside India • the payment for such service is received by the service provider in convertible foreign exchange • the service provider and service receiver are not merely establishments of a distinct person by virtue of item (b) of Explanation 2 of clause 44 of section 65B of the Act. Now in light of the said conditions drill down in each point to assess whether the service provided by you are exempted by way of export of service rules or not. Hope now your query will be resolved.
CA Ashish Pathak
(Employed at Cipla Ltd.)
(2779 Points)
Replied 28 July 2012
Hello Nirmit,
Though you are providing service in Hong kong, this cannot be regarded as export of service because the payment of such service is being received by you in the indian currency.
It should be noted that a provision of service outside India can be treated as export of service only when the payment of such service is received by the service provider in convertible foreign exchange. So the service provided by you is not exempt. Regards.
CA student
(CA Final)
(404 Points)
Replied 28 July 2012
"I provide service to a company in Honkong. But the consideration received is in Indian rupees. Whether my service is export of service and so i have no liabilty to pay service tax or the other way round.."
Not an Export of Service
Prateek Agarwal
(Sr. Executive - Finance & Accounts)
(1732 Points)
Replied 28 July 2012
Agreed with the above views.
RENGARAJ R.K
(ADVOCATE)
(7557 Points)
Replied 01 August 2012
One of the condition for claiming export of services is the money in foreign exchange not in INR.
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