TaxTMI 
TaxTMI 
2021 (10) TMI 641
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.... appellant is incorporated under the Companies Act, 2013, and is having service tax registration. 4. During the period October, 2015 to March, 2016 and April, 2016 to September, 2016, the appellant provided services in the nature of 'assistance in procurement of goods' by the parent company in Hong Kong, directly from third parties in India. The nature of services included-keeping track of consignment, quality checks and timely dispatch by third parties to designated places of the parent company, outside India. For the services so provided, the appellant raised invoice for reimbursement of expenses, without charging any service tax and payment for the same was received by the appellant in convertible foreign exchange. 5. On the basis of some wrong legal advice that the services provided by the appellant to its parent company in Hong Kong are taxable services of "Management or Business Consultancy Services", the appellant erroneously paid service tax of Rs. 12,84,404/- for the period October, 2015 to March, 2016 and Rs. 9,82,965/- for the period April, 2016 to September, 2016. Subsequently on realizing the mistake, the appellant filed revised returns for both the periods and the e....
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.... any service provided or agreed to be provided shall be treated as export of service when, - (a) the provider of service is located in the taxable territory, (b) the recipient of service is located outside India, (c) the service is not a service specified under Section 66D of the Act, (d) the place of provision of service is outside India, (e) the payment of such service has been received by the provider of service in convertible foreign exchange, and (f) the provider of service and recipient of service are not merely establishments of a distinct person in accordance with item (b) of Explanation 3 of clause (44) of Section 65B of the Act. Admittedly, there is no dispute in the present case regarding condition no. (a), (b), (c) & (e), inasmuch as the provider of service i.e. the appellant is located in taxable territory (India), the recipient of service i.e. parent company is located outside India (Hong Kong), the service provided is not specified under Section 66D and the payment of such service has been received in convertible foreign exchange. Thus, the only dispute is regarding clause (d) & (f) of Rule 6A(1). 9. Condition specified in clause (f) satisfied in ....
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....ST has considered the explanation 3(b) and has held that services provided by a company in India to its 100% holding company abroad, cannot be considered as establishments of a distinct person and therefore such services would be export of services. Therefore, establishment of appellant in India and establishment of its parent company in Hong Kong are not establishments of a distinct person, and hence condition specified in clause (f) of Rule 6A(1) stands satisfied in the present case. 10. Condition of clause (d) satisfied in the present case: In terms of Rule 9 of Place of Provision of Services Rules, 2012, the place of provision shall be in India only, when the services provided by the appellant are held to be 'intermediary services'. Intermediary has been defined under Rule 2(f) as under:- (f) 'intermediary' means a broker, an agent or any other person, by whatever name called, who arranges or facilitates a provision of service (hereinafter called as the 'main service') or a supply of goods, between two or more persons, but does not include a person who provides the main service or supplies the goods on his account. In the present case, the appellant is neither arranging ....
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....ntioned - "being reimbursed of establishment expenses for the month". It is further held that appellant is working as an intermediary / agents of another establishment in a non-taxable territory, hence, service provided by appellant are not covered under Condition No. (d) of Rule 6A(1) of Service Tax Rules, as the place of provision of such services is in India. It is further observed that in case of 'intermediary services' under the Place of Provision of Services Rules, 2012, the place of provision shall be the location of service provider (India). Accordingly, refund was refused upholding the order-in-original. Being aggrieved, the appellant is before this Tribunal. 13. Heard the parties. 14. The appellant have reiterated the grounds before the Commissioner (Appeals) and have further relied on the ruling of Hon'ble Supreme Court in the case of Vodafone International Holdings BV vs. Union of India (2012) 6 SCC 613, wherein it has been held that a subsidiary and its parent company located in different taxable territories are totally distinct tax payer(s) or different persons/ entities. 14.1 Further, reliance is placed on the ruling of Hon'ble Gujarat High Court in the case of Li....