Import of Service

[Kaustubh Karandikar]

Mr. X is on the pay roll of XYZ, France but is working in India for PQR and will receive instructions from PQR India. The salary and other expenses of Mr. X and the family of Mr. X who is staying in France, is initially paid by XYZ, France and subsequently recovered from PQR, India by issuing an Invoice in foreign currency. Is PQR required to pay GST under reverse charge on the amount paid to XYZ, France?

[Rajagopalan Ranganathan]

Sir,

You are saying Mr X is working in India. Therefore though the charges for the service provided by Mr X is initially paid by XYZ and later collected from PQR by raising appropriate invoice gst is payable by PQR in India since the place of supply is within the taxable territory..

AI Summary

Reverse charge: recipient liable for GST when services are rendered in India even if billed by foreign employer. Because the employee performs services in India, the place of supply is within the taxable territory and PQR, as recipient, is liable to pay GST under the reverse charge mechanism on amounts invoiced by the foreign employer, despite initial payment by the foreign employer and invoicing in foreign currency.