Case Law Details
Principal Commissioner of Central Goods & Service Tax Vs Boeing India Defense Pvt. Ltd. (CESTAT Delhi)
CESTAT Delhi held that value of reimbursement of expenditure is not includible in the value of taxable service and accordingly, service tax is not payable on the same.
Facts- The Appellant had entered into an agreement with its holding company, namely ‘The Boeing Company’ for providing services on a cost-plus markup basis. In order to provide service effectively and efficiently, the Appellant employed employees of TBC on a secondment basis. The Appellant entered into a salary reimbursement agreement with TBC to facilitate the secondment of employees from TBC to it and payment of remuneration to the seconded employee in their home country.
Pursuant to service tax audit, the impugned show cause notice was issued demanding service tax on the expenditure incurred towards a hotel stay, and school tuition fees for the disputed period considering the same as part of the consideration paid for the import of manpower services from April 2015 to June 2017.
The main issue in the present case is with regard to inclusion of reimbursement of expenditure amount for charging service tax.
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