Pure agent principle: reimbursable expenditures failing valuation conditions must be included in taxable service value. Valuation rules exclude expenditure of a service provider acting as a Pure Agent only if all eight conditions of Rule 5(2) are met; many reimbursable items claimed by Custom House Agents (documentation, transport, storage, handling, inspection, port and terminal charges, etc.) are not covered by pure agent treatment because they are used in producing the output service, and where CHAs charge amounts above actual expenditure the pure agent conditions are breached and such sums must be included in the taxable value.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Pure agent principle: reimbursable expenditures failing valuation conditions must be included in taxable service value.
Valuation rules exclude expenditure of a service provider acting as a Pure Agent only if all eight conditions of Rule 5(2) are met; many reimbursable items claimed by Custom House Agents (documentation, transport, storage, handling, inspection, port and terminal charges, etc.) are not covered by pure agent treatment because they are used in producing the output service, and where CHAs charge amounts above actual expenditure the pure agent conditions are breached and such sums must be included in the taxable value.
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