Between The Lines... January, 2016

The team of Vaish Associates, Advocates wishes you a happy and prosperous Year 2016!

I. Salaries of expats not subject to service tax

The Authority for Advanced Ruling (AAR) has recently held that there should be no liability to pay service tax on the salary and allowances payable by expatriates in terms of the dual employment agreement.

In the case of North American Coal Corporation India Pvt. Ltd., Pune v. Commissioner of Central Excise, Pune, there was a tripartite agreement between North American Coal Corporation ("NAC") USA, NAC India and Mr. Sloan. Under this agreement, Mr. Sloan's (who is on the permanent roll of the NAC USA) services were to be utilized by NAC India for a particular term.