Clarification on valuation of supply of import of services by a related person where recipient is eligible to full input tax credit – Reg.

Open market value: invoice value for import of services from related persons deemed where recipient eligible for input tax credit.

Where a registered person in India imports services from a related person abroad and the recipient is eligible for full input tax credit, the invoice value declared by the recipient may be deemed to be the open market value for valuation purposes; if no invoice is issued by the supplier, a declared nil value by the recipient may be treated as the declared value and deemed the open market value. Tax on such import of services is payable by the recipient under the reverse charge mechanism and the recipient must issue a self invoice.