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TMI BlogExport of servicesX X X X Extracts X X X X X X X X Extracts X X X X ..... Export of services X X X X Extracts X X X X X X X X Extracts X X X X ..... ving branch office located in India and reimbursed all expenses made in India with some profit from our US office against the invoice raised by Indian branch to US office. And we get all the payment only foreign convertible currency. My query is 1.whether are we Exporter of service? 2. If yes do we have to execute the bond or LUT as the case may be? 3. Do we get the refund against the input ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s used in the business in India? 4. So far we have shown as export of service under service tax regime. 5. So far we have not made transfer pricing. Is there any consequences under income tax act? Please kindly elaborate me sir. Thanks in advance. Reply By RAMESH PRAJAPATI: The Reply: As per section 2 (6) of IGST Act "export of services" means the supply of any service when, (i) the supp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lier of service is located in India; (ii) the recipient of service is located outside India; (iii) the place of supply of service is outside India; (iv) the payment for such service has been received by the supplier of service in convertible foreign exchange; and (v) the supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 1 in section 8 (as under). Explanation 1.--For the purposes of this Act, where a person has,-- (i) an establishment in India and any other establishment outside India; (ii) an establishment in a State or Union territory and any other establishment outside that State or Union territory; or (iii) an establishment in a State or Union territory and any other establishment being a business vertical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registered within that State or Union territory, then such establishments shall be treated as establishments of distinct persons. As stated above, services supplied by Indian office to US office of the same company is not export of service although Indian Branch raises invoice and collects payment in FE. It will be treated as interstate supply. IGST is payable. Valuation is to be done as per GST ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Valuation Rules. Transfer pricing also to be taken care properly. Reply By KASTURI SETHI: The Reply: Sh.Prajapati Ji, You have really done hard work. No doubt left. Agree with you in toto. Reply By THYAGARAJAN KALYANASUNDARAM: The Reply: Dear expert, Thanks for your timely reply. Reply By THYAGARAJAN KALYANASUNDARAM: The Reply: Dear expert, Even without adding any margin. That is actua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l expenses incurred by the Indian company reimbursed from foreign concern also is liable to pay IGST tax under GST regime. Reply By THYAGARAJAN KALYANASUNDARAM: The Reply: Dear Expert, Since both the company got registered separately under the respective country act not as branch And as per the person definition my understanding should be two different person. Kindly Clarify Thanks in Advan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce
Reply By RAMESH PRAJAPATI:
The Reply:
Are both companies are declared in the Balance Sheet as related party.
Reply By THYAGARAJAN KALYANASUNDARAM:
The Reply:
Dear sir,
No sir. X X X X Extracts X X X X X X X X Extracts X X X X
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