Liability of Service tax - inspection and supervision

[Asked by Guest]

We are doing inspection and supervision of production on behalf of a garments importer based outside India.Charges are paid by the local exporter. Are we liable to Service Tax?

[Surender Gupta]

The scope of inspection and supervision of production is very wide. The detailed study of the contract would help to determine the nature and taxability of this service.

AI Summary

Service tax liability for inspection and supervision of production depends on the contractual characterisation of the service.
Service tax liability for inspection and supervision of garment production depends on the contractual characterisation of the service: the scope is wide and whether the activity is taxable turns on the contract's allocation of obligations, the beneficiary of the service, and the payment arrangements.