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2018 (12) TMI 893 - AAR - GSTLevy of GST - Reimbursement of salary on behalf of foreign entity - pure agent or not - Held that:- The applicant is a Crew Recruitment and Placement Agency, and are involved in selecting and recruiting shipping personnel on behalf of their principal/ client who is a Foreign Ship Owner and for which they are charging Administration fees and paying GST on such Administration charges so received. The Salary of Crews of RMS will be deposited in the account of the applicant in one go and the same will be transferred from the applicant’s account directly to the bank accounts of the Crews, by the bank, on the directions of the applicant - the entire amount received by the applicant from RMS towards salary of crews is disbursed as such. Hence with respect to this transaction it is crystal clear that the applicant is acting as a pure agent of RMS. The applicant will be acting as a pure agent of RMS in as much as the entire amount received by them as Crews’ Salary will be disbursed to the Crew and no amounts from the said receipt will be used by the applicant for his own interest. In fact, for performing as a pure agent they will also be receiving compensation separately in the form of fixed fees to be charged as service charges. The applicant will not be liable to pay GST on Salary amount received from RMS and disbursed to the Crew. Ruling:- GST is not applicable on Reimbursement of salary on behalf of foreign entity.
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