Reversre charge on Legal fees paid out side the India

[Guest]

Dear Sir,

We are a India based company and having manpower supply business ( turnover more than 10 lacs). we are fighting a legal case regarding manpower issue in Oman (Out side india) with the help of an advocate in oman. We are paying legal fees to advocate around 1 Crore p.a.. Whether i need to pay service tax on the same in India.

[PAWAN KUMAR]

Dear Sir,

As per my view, the place of provision of service as per POPOS Rules, 2012, Rule 3, is service receiver location i.e. India, an taxable territory, Therefore service tax would be liable by the service receiver under provisions of section 68(2) of the Fianance Act.

[DR.MARIAPPAN GOVINDARAJAN]

Dear Sir,

In my opinion the service is rendered outside India. As such service tax is not payable under Reverse Charge Mechanism.

[PAWAN KUMAR]

Dear Sir,

As the service being provided outside India to a person having establishment in India, The payment for such service being done from India, Then, as per the POPOS Rules, 2012, Rules3, the place of provision of service generally the location of the service receiver. In the instant case, service receiver locatioin is India, therefore liable for service tax. The provision under rule 9 of POPOS Rules, 2012 shall not applicable in this case.

AI Summary

Place of provision of services determines reverse-charge liability for foreign legal fees paid by Indian service recipients. Under the Place of Provision of Services Rules (POPOS Rules, 2012), Rule 3, the location of the service receiver governs taxability; if the receiver is located in India the service is treated as provided in a taxable territory and the Indian recipient may be liable to discharge service tax under the reverse charge mechanism, while an alternative view contends services rendered outside India are not taxable and Rule 9 is inapplicable here.