Services of seconded employees not taxable under Manpower Recruitment or Supply Agency category - High Court upholds CESTAT’s decision

  
This Tax Alert gives an update on the recent  Allahabad High Court (HC) ruling, in the case of Commissioner of Central Excise v. M/s Computer Sciences Corporation India Pvt Ltd; 2014-TIOL-1896-HC-ALL-ST. 


It has held that payments made by an Indian entity in respect of services of expatriate employees, obtained from its group company (directly) or by transfer of employees cannot fall within the purview of Manpower Recruitment or Supply Agency services, as the Revenue had shown no basis whatsoever for holding that the instant transaction fulfilled critical requirements stipulated in (erstwhile) Section 65(105) clause (k) of the Finance Act, 1994.
  
The HC dismissing the Revenue’s appeal upheld the Delhi CESTAT’s decision as being in accordance with law.