Clarification in respect of levy of GST on Director's remuneration

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..... 0/2020-GST dated 10th June, 2020 has issued a clarification in respect of levy of GST on Director's remuneration, in order to ensure uniformity in the implementation of the provisions of law across the field formations, which is annexed herewith. In exercise of powers conferred by section 168 of the Tripura State Goods and Services Tax Act, 2017 (Tripura Act No. 9 of 2017) for the purpose of uniformity in the implementation of the Act it is instructed to follow the clarification issued vide Circular No. 140/10/2020-GST dated 10th June, 2020 by the Department of Revenue, Central Board of Indirect Taxes and Customs, GST Policy Wing. Encl.: Circular No. 140/10/2020-GST. [No.F.1-11(8)-TAX/GST/2020/GST/2020/4716-24] (T. Darlong , TCS-SSG .....

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..... said company; and (ii) leviability of GST on remuneration paid by companies to the whole-time directors including managing director who are employees of the said company. 3. In order to ensure uniformity in the implementation of the provisions of the law across the field formations, the Board, in exercise of its powers conferred under section 168(1) of the CGST Act hereby clarifies the issue as below: Leviability of GST on remuneration paid by companies to the independent directors or those directors who are not the employee of the said company 4.1 The primary issue to be decided is whether or not a "Director' is an employee of the company. In this regard, from the perusal of the relevant provisions of the Companies Act, 2013, it can .....

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..... e also an employee of the said company 5.1 Once, it has been ascertained whether a director, irrespective of name and designation, is an employee, it would be pertinent to examine whether all the activities performed by the director are in the course of employer-employee relation (i.e. a "contract of service") or is there any element of "contract for service". The issue has been deliberated by various courts and it has been held that a director who has also taken an employment in the company may be functioning in dual capacities, namely, one as a director of the company and the other on the basis of the contractual relationship of master and servant with the company, i.e. under a contract of service (employment) entered into with the compa .....

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