Case Law Details
This is with reference to Supreme Court judgement dated 11-04-2019 in case of Nissin Brake India Pvt. Ltd where the transaction between the Indian entity and parent company with respect to deputation of its employees in India was discussed and the decision pronounced by the CESTAT (Delhi) was upheld by the apex court.
Facts of the case
The assessee had entered into an agreement with its overseas parent company in Japan for payment of salary and other perquisites for employees deputed from such parent company. The employees deputed by the parent company operated under the control, direction and supervision of the assessee. Further, the assessee withheld tax on the salary paid to such employees as per the requirements of the Income-tax Act, 1961. The salary payment to such employees was disbursed by the overseas parent company. Subsequently, the salary cost was reimbursed to the parent company by the assessee.
The Revenue sought to tax such reimbursement of salary as manpower supply services and demanded service tax under the reverse charge mechanism.
The Tribunal ruled in favour of the assessee, after which the Revenue had filed an appeal with the Supreme Court (SC).
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Can you please share the citation of this judgement?