POT for reverse charge

[Debtosh Dey]

I fail to understand as to why provision for 'continuous service' as defined u/R 2 of POT is not reflected in POTrule 7 read with 10 for reverse charge. Interestingly, rule 7 does not override rule 2. But Notification 28/2011-ST (amended) prescribes only telecom and work contract services as 'continuous service'. Question is then : What will happen to other continuous services like say sponsorship spanning over a year or so where tax liability cannot be ascertained without measuring performance ? Is MF's circular 144/13/2011-ST relevant for such service ?

Debtosh Dey, M.Sc (Engg), FIE, C. Engg (I), FCMA, FCS, LL.B.

[DR.MARIAPPAN GOVINDARAJAN]

In respect of continuous services the MF's circular No.144/13/2011-ST is relevant.

AI Summary

Continuous services definition affects reverse charge applicability; relevant circular clarifies treatment for non-telecom work-contract cases. Applicability of reverse charge under POT for services rendered continuously is uncertain because Rule 2's definition of continuous service is not reflected in Rules 7 and 10, and a notification limits treated continuous services to telecom and work contracts. Administrative guidance in the relevant ministry circular is indicated to be applicable in determining reverse charge treatment for other continuous services measured over time.