Commission Agent

[DEEPAK SHARMA]

DEAR SIR,

KINDLY RESOLVE THE ISSUE

I AM EXPORTER OF GOODS THROUGH COMMISSION AGENT, MY COMMISSION AGENT ESTABLISHED THEIR OFFICE AT JAMMU. GOODS HAS BEEN DIRECTLY EXPORTED BY US TO DUBAI. LATER ON WE HAVE PAID COMMISSION TO OUR COMMISSION AGENT. PROOF OF EXPORT ARE ACCEPTED. DEPT. SAYING THE EXPORTER IS LEVIABLE SERVICE TAX ON COMMISSION PAID TO COMMISSION AGENT. WHEREAS SERVICE RECEIVED FROM COMMISSION AGENT IS IN OR IN RELATION OF EXPORT OF GOODS.

WE HAVE PAID COMM AGENT IN INR

THERE IS REFFERENCE OF COMM AGENT ON EXPORT DOCS.

COMM AGENT RAISD BILL US WITH THE REFFERENCE OF FOREIGN BUYER.

PLEASE GUIDE US EITHER THE EXPORTER IS REQUIRE TO PAY SERVICE TAX?

AI Summary

Place of provision of service: commission agent location determines service tax liability on export-related commission under intermediary rules.
For intermediary services, Rule 9 of the Place of Provision of Services rules (effective 1 October 2014) locates provision at the service provider's place; where the commission agent is in a non-taxable territory, the commission is not a "taxable service" in the taxable territory and the reverse charge mechanism on the service recipient does not apply, although departmental reverse charge claims may have been valid for periods before the POPS amendment.