Taxability of expenditure in foreign currency in case of M/s ONGC Videsh Ltd – CBEC Clarifies

LETTER [F.NO.137/147/2010 – SERVICE TAX], DATED 11-7-2011

I am directed to refer to your letter C. No. I-26(494) ST/ADT/APR (GP.IX)/ APR191/08, dated 22-7-2010 on the subject mentioned above.

2. The matter has been examined and it is observed that the said letter does not raise any question of law. The matter that has been referred in the said letter is a question of fact which has to be examined in the light of overseas contracts, joint venture agreements, mandate of OVL and its overseas formations etc.

The Board is not supposed to determine such complex questions of fact on the basis of a short summation of facts that have been communicated by the field. The Commissionerate is in possession of all the facts of the matter and best equipped to determine such issues.

3. Therefore, it has been decided that your office may go ahead in the matter as deemed appropriate in terms of law.

4. I have been also directed to state that in future, the issues relating to question of facts must not be forwarded to the Board thus keeping the matter pending on this ground alone.

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