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M/s North American Coal Corporation India Pvt. Ltd. Versus Commissioner of Central Excise, Pune-III

2015 (12) TMI 420 - AUTHORITY FOR ADVANCE RULINGS

Foreign Employees on Deputation in India - Interpretation of term "service" - Salary payment of US Company's employee recruited - Section 65(44) - Held that:- The agreement is very clear to suggest that so long as Mr. Sloan is serving in India, he will be treated to be the employee of the applicant though his interests as the employee of NAC, US, insofar as the social security interests are concerned, will be taken care of by NAC, US. It is trite that he does not get the salary from NAC, US when .....

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here shall be no liability to pay service tax on the salary and the allowances payable by the applicant to the employee in terms of the dual employment agreement and such salary will not be eligible to levy the service tax as per the provisions of the Finance Act. - Decided in favour of assessee. - Advance Ruling No. AAR/ST/13/2015, Application No. AAR/44/ST/2/2014 - Dated:- 6-11-2015 - V. S. Sirpurkar, Chairman, S. S. Rana, Member (T) And R. S. Shukla, Member (L) For the Applicant : Shri Kumar .....

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ver, his services were required by the Indian company for its activities. There is an agreement between the Indian company i.e. NAC, India and Shri Sloan, which agreement is on record and being relied upon by the applicant company. This is a tripartite agreement between NAC, US, NAC, India and Mr. Sloan. Under this agreement, the services of Mr. Sloan were to be utilized by NAC, India for a particular term. It is apparent from the agreement that so long as Mr. Sloan serves in India, all his sala .....

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by the applicant suggests that this arrangement is going on for quite some time and in the past these services were treated to be the manpower services and were taxed under the service tax regime as it then existed. In the past regime, there was a specific Entry No. Section 65(68) read with Section 65 (105)(k). However, after 2012 and after the advent of the Negative List, all those entries have gone into the oblivion and now there is a fresh definition of service under Section 65 (44). The appl .....

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hich is clear from the wordings of the agreement, there is no question of any service tax provision being applicable to the salary paid by NAC, India to Mr. Sloan 4. In our opinion, the contention is absolutely correct. We will have to go by the definition of service and if the definition of service excludes the service offered by an employee to the employer then it has to be so held. For interpreting this clause then we can not go to the past entries available prior to 2012 and can not interpre .....

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ot get the salary from NAC, US when he is offering services to NAC, India in that behalf, the benefits are mutually exclusive, at least so far as, they are concerned with the salary. The only obligation on NAC, US is regarding the social securities which are not reimbursed by NAC, India to NAC, US The learned counsel is prepared to go on record and we record his statement that there is no such reimbursement regarding the social security borne by NAC, US in respect of Mr Steve R. Sloan 5. Once th .....

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