RCM Liability on Repair Cost of Lab Instrument outside India

[Manjunath S]

Dear Experts,

We imorted one Crush Testing instrument from Sweden in 2017, now the same instrutrument is not working and sent it for repair to sweden.

Now instrument is repaired & returned from supplier, Few spares are replaced, and supplier as raised two invoice for both Spares & Service separately.

We have paid Custom duty on Spares replaced.

My Query is

a) Is it required to pay IGST under RCM for Repair Cost? which is repaired outside india.

Kindly guide us with appropriate sections/notifications, If any

Thanks in advance.

[YAGAY andSUN]

If you had paid Customs Duty along with IGST on the entire cost including service charges and the cost of material used for Repair then in our view no need to pay it again.

[Manjunath S]

Dear Sir,

We have paid Customs duty with IGST only for Spares used and not on Service/Repair charges.

[KASTURI SETHI]

I support the views of M/s.Yagay and Sun, Sirs. Customs duty and IGST have to be paid for repair charges also.

AI Summary

Reverse charge liability for imported repair services: IGST may be payable where service value wasn't discharged through customs. Whether IGST under the Reverse Charge Mechanism applies to repair services performed abroad for an imported instrument: spares returned with customs duty and IGST paid only on spares, not on the foreign repair service, so RCM IGST may be payable unless IGST on service was discharged at customs.