Determination of the Location of the Service Receiver/Service Provider :
“Location of the service provider/service receiver” is determined by applying the following steps sequentially-
A. Where the service provider/service receiver has obtained a single registration, whether centralized or otherwise, the premises for which such registration has been obtained.
It implies that in case the service provider/receiver has more than one unit, he must have obtained centralized registration in order to be covered under this clause.
B. Where the service provider/service receiver is not covered under point A above:
(i) The location of his business establishment; or
| Business establishment: is the place where the essential decisions concerning the general management of the business are adopted, and where the funct ions of its central administration are carried out.
This could be head office, or a factory, or a workshop, or shop/ retail outlet. However, a service provider or receiver can have only one business establishment. For instance, head office of M/s ABC Enterprises is in India, and its branches are in Malaysia, Singapore and London. The business establishment of M/s ABC Enterprises is in India. |
(ii) Where the services are provided from/used at a place other than the business establishment, that is to say, a fixed establishment elsewhere, the location of such establishment; or
| Fixed establishment: is a place (other than the business establishment) where there is a permanent and adequate human and technical resources to provide the services that are to be supplied by it, or to enable it to receive and use the services supplied to it for its own needs.
It may be noted that in case the staff is temporarily available by way of a short visit to a place, such place cannot be termed as fixed establishment. For instance, George Telecoms of USA sets up an office with staff in India to provide services to Indian customers. Fixed establishment of George Telecoms is in India. |
(iii) Where services are provided from/used at more than one establishment, whether business or fixed, the establishment most directly concerned with the provision/use of the service; and
| Whether the establishment is most directly concerned with the provision/use of the service depends on the facts and supporting documentation, specific to each case. The documentation will include the following:-
Ø written contract(s) or any written correspondence which sets out in detail their understanding of the oral contract between the service provider and receiver; Ø in particular, for suppliers, from which establishment the services are actually provided; Ø in particular, for receivers, at which establishment the services are actually consumed, effectively used or enjoyed; Ø details of how the business fits into any larger corporate structure; Ø the establishment whose staff is actually involved in the execution of the job; Ø performance agreements (which may be indicative both of the substance and actual nature of work performed at a particular establishment); Thus, normally in the case of multiple establishments of a person, it will be the establishment that actually provides, or receives, a service that would be treated as “directly concerned‟ with the provision of service, notwithstanding the contractual position, or invoicing or payment. For instance, Shubham Ltd. is incorporated in India. However, it provides its services entirely from London. In the instant case, the location of Shubham Ltd. is London, being the place where the establishment most directly concerned with the supply is located. |
(iv) In the absence of such places, the usual place of residence of the service provider/service receiver.
Usual place of residence:
| In case of | Usual place of residence |
| (i) A body corporate | of service provider/service receiver is the place where it is incorporated or otherwise legally constituted. |
| (ii) Telecommunication services | of service receiver is the billing address of service receiver. |
| (iii) An Individual | of service provider/service receiver is the place (country, state etc) where the individual spends most of his time for the period in question. Hence, an individual cannot have more than one usual place of residence. |