Standard Chartered Bank Vs Commissioner of CGST & CX Mumbai South (CESTAT Mumbai)
CESTAT Mumbai held that the allocation of head office executive and general administrative expenses by the head office of Standard Chartered Bank to India branch cannot be subjected to levy of service tax under the Finance Act, 1994.
Facts- The appellants is a banking company operating through various branch offices situated across India and having their head office in London, United Kingdom i.e., Standard Chartered Bank, UK (SCB-UK). The SCB-UK has an extensive global network of its branches all over the world including India.
In order to provide support to all its global branches SCB-UK being the head office incurs certain expenses under the various heads such as advertising, auditing fees, donations, entertainment, gross emoluments, insurance, legal professional fees, national insurance contributions, pension contributions, postage, telephone, telegraph, printing, stationery, publication, newspapers, rent & rates, subscriptions, travel expenses, machinery, furniture, computer, Microfilm, miscellaneous expenses etc. All the above expenses are termed as ‘head office executive and general administrative expenses’. These expenses incurred by the head office of the appellants are divided proportionately across various branches situated in different countries on the basis of gross receipts of the banks functioning in the respective country.
