Home Case Index All Cases Service Tax Service Tax + AT Service Tax - 2017 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (6) TMI 1028 - AT - Service TaxManpower supply service - deployment of employees by the Japanese Company to their project office in India - whether or not the appellants are liable to pay service tax as a recipient of taxable service in terms of Section 66A? - Held that: - the appellants are an establishment in India and the provisions of Section 66A is made applicable to any permanent establishment in India. Section 66 A (2) Explanation – 1, clearly stipulates that a person carrying on a business through a branch or agency in any country to be treated as having business establishment in that country. Admittedly, the appellants are a branch of Japanese company, undertaking the project work in India. As such, we hold that the appellants are covered by the provisions of Section 66A for any tax liability, on reverse charge basis, when such taxable services were received from outside India. The deputation of employees within the company cannot be considered as supply of manpower. Further, the Japanese company is not shown to have been engaged in the activity of manpower recruitment or supply services. In these factual situations, we find that the liability of the appellant on such tax entry cannot be held as legally sustainable. Determination of consideration for taxable services - amount debited to the books of accounts - Held that:- The transaction in the present case is not between two associated enterprises. There is nothing on the record to indicate that the branch project office in India can be considered as an associated enterprise of Japanese company. The admitted facts are that the appellant is a branch project office of the Japanese company and not an associated enterprise of the Japanese company. The above said explanation will cover only transactions between associated enterprises as clarified by the Board vide letter dated 29.02.2008. Appeal allowed - decided in favor of appellant.
|