Non-resident service taxation clarified by Karnataka HC in favor of assessee

The Karnataka HC clarified that services provided by a non-resident individual outside the country with no fixed establishment in the country are to be taxed at the hands of the service receiver. The court ruled in favor of the assessee, dismissing the appeal.

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The Karnataka High Court judgment in 2012 clarified that when a service provider outside the country has no fixed establishment in the country, the service rendered inside the country is to be taxed at the hands of the service receiver. Prior to an amendment in 2006, the service receiver was not taxed for services provided by a non-resident individual. The court ruled in favor of the assessee, and the appeal was dismissed.

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