Support Services

[Gopalarathnam Muralidharan]

state  cooperative milk federation are being audited by Government Cooperative audit wing.  Milk federations are remitting audit fees to Government.   Whether these payment of audit fees to Govt will amount to Support services and if so liable to pay tax under Reverse charge Mechanisam

G Muralidharan

AI Summary

Support services by government: taxable unless they are sovereign or statutory-obligation audits, which avoid reverse-charge tax.
Government services are generally non-taxable under the negative list, but support services-infrastructural, operational, administrative, logistic, marketing or similar outsourced functions-are taxable when supplied to business entities; however, services rendered by government in discharge of sovereign functions or statutory obligations are excluded, so a government cooperative audit conducted to fulfil a statutory duty would not be treated as a taxable support service and would not attract service tax under reverse charge.