Service Tax applicable on Foreign Inward Remittance

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  1. Chandela

    Chandela New Member

    This discussion is with reference to receipt of Foreign Currency from overseas --> conversion from FCY to Indian Rupee --> credit passed by bank to Indian Customer for amount equal to converted rupee.

    Here is involve two stages where bank provide service
    1. Service of Converting currency in India for which bank charge exchange margin
    2. Banking Service for which bank recover in the name of commission or service charges.

    The Government, Ministry of Finance has issued notification Circular No. 163/14/2012-12 dated 10 July 2012. Some expert interpret that vide referred circular, service tax is waived on inward remittance for both purposes (1) Conversion of currency (2) Service Charges.

    Some expert interpret the circular that waiver is only for service charges and ST shall continue applicable on currency conversion.

    I solicit views from on the matter
     
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