Comission from Indian Main agent to foreign subagents

[Priya Rajarajan]

We are explaining our nature of activity in brief for your kind advice.

1. In our case seller of goods and purchaser of goods both are situated outside India. We help them to close deal and getting commission for trading of such goods.
2. We provide service to the client situated abroad as mentioned above and getting commission in convertible foreign exchange.
3. This transaction is not Import as goods are not arriving in India.
4. Our service consumed outside India and by nature it is pure export of service.

5.I'm a commission agent and I in turn need to pay to 3 of foreign sub agents.(2 million usd/month per agent)

6.What is the max amount that could be paid to foreign sub agents.

7.What is the procedure and the documents required to provide the bank?

8.Whether the commission paid to foreign sub agent is taxable

AI Summary

Place of Provision rules determine whether commission payments to foreign subagents attract service tax in cross border brokerage arrangements.
This matter concerns whether service tax applies to an Indian commission agent's foreign sourced commission and to payments to foreign subagents. Legal analysis focuses on the Place of Provision of Services Rules, the amended definition of intermediary, a conditional exemption tied to an FOB threshold, and subsequent notifications that variously rescind or amend the exemption; practitioners therefore must determine which notification governs, whether the FOB threshold condition is met, and supply banks with prescribed remittance documentation.