Goods and Service Tax is one indirect tax for the whole nation, which will make India one unified common market. Goods and Service Tax (GST) is a single tax on the supply of goods and services, right from the manufacturer to the consumer. Credits of input taxes paid at each stage will be available in the subsequent stage of value addition, which makes Goods and Service Tax (GST) essentially a tax only on value addition at each stage. The final consumer will thus bear only the Goods and Service Tax (GST) charged by the last dealer in the supply chain, with set-off benefits at all the previous stages
Article 246A of Constitution of India governs Goods and Service Tax.
At the Central level, the following taxes are being subsumed
a. Central Excise Duty,
b. Additional Excise Duty,
c. Service Tax,
d. Additional Customs Duty commonly known as Countervailing Duty, and
e. Special Additional Duty of Customs.
At the State level, the following taxes are being subsumed:
a. State Value Added Tax/Sales Tax,
b. Entertainment Tax (other than the tax levied by the local bodies),
c. Central Sales Tax (levied by the Centre and collected by the States),
d. Octroi and Entry tax,
e. Purchase Tax,
f. Luxury tax, and
g. Taxes on lottery, betting and gambling.
Levy & collection of Central Goods & Service Tax is governed by Central Goods and Service Tax Act, 2016 and Levy & Collection of State Goods & Service Tax is governed by respective State Goods and Service Tax Act, 2016.
The Goods and Service Tax (GST) Act is applicable for the whole of India including Jammu & Kashmir. It is applicable to territorial waters, seabed, and subsoil underlying the territorial waters, airspace above its territory and territorial waters including installations, structures and vessels located in the continental shelf of India and the Exclusive economic zone of India.
No, Supply of goods or services beyond the territorial waters of India is not covered under the Goods and Service Tax (GST) Net. But the Supply of goods or services to installations, structures and vessels located in the continental shelf of India and the Exclusive economic zone of India is covered under Goods and Service Tax (GST) Net.
Section 7 is the charging provision of the CGoods and Service Tax (GST) / SGoods and Service Tax (GST) Act. It provides that all intra- State supplies would be liable to CGoods and Service Tax (GST) / SGoods and Service Tax (GST). It also provides for the rate of tax applicable on such supplies, the manner of collection of tax by the Government and the person who will be liable to pay such tax.
The levy of tax on supply of goods and/or services is in two parts?
(i) in the hands of the supplier and
(ii) in the hands of the recipient of goods/services under reverse charge mechanism
Normally, the supplier of goods and/or services will be liable to discharge tax on the supplies affected. However, the Central or State Governments upon a recommendation of the Goods and Service Tax (GST) Council are empowered to specify by notification the categories of supplies in respect of which the recipient of goods and/or services will be liable to discharge the tax.
All other provisions of this Act will apply to the recipient of such goods and/or services as if the recipient is the supplier of such goods and/or services? viz., for the limited purpose of such transactions, the recipient would be deemed to be the “supplier
The meaning of intra-State supply is contained in Section 3A of the IGoods and Service Tax (GST) Act. A supply would be an intra-State supply if the location of the supply and the place of supply, both are within the same State. The term “intra-State” would mean within the State. Section 3A is subservient to the Sections 5 and 6 of the IGoods and Service Tax (GST) Act, which deal with provisions for determining the place of supply of goods and/or services. Section 3A has to be read alongside Sections 5 and 6 and whenever a conflict arises between the said provisions, Section 3A has to make way for Section 6, which is signified by usage of the words ?subject to the provisions of Sections 5/6.
What is crucial is to determine, whether the location of the supplier and the place of supply are in the same State. Once it is determined that the location of the supplier and the place of supply are in the same State the transaction would become an intra-State transaction and therefore, be governed by the CGoods and Service Tax (GST) / SGoods and Service Tax (GST) Act.
Location of Supplier of Goods is not defined in the Act. Generally, it is the principal place of business of the supplier as specified in the registration certificate.
Location of recipient of service changes depending on various circumstances
i. If the supplier of service is registered then the place of business of registration
ii. If the supply is made from other than the registered place of business then the location of such fixed establishment.
iii. If the supply is made from more than one establishment whether place of business or fixed establishment, the location most directly concerned with provision of service
iv. In any other case, usual place of residence
Fixed establishment means a place (other than the place of business) which is characterized by a sufficient degree of permanence and suitable structure in terms of human and technical resources to supply services, or to receive and use services for its own needs.
For example, a place where human and technical resources are available to supply services
Usual Place of residence
i. in case of an individual, the place where he ordinarily resides;
ii. in other cases, the place where the person, as defined in sub-section (74), is incorporated or otherwise legally constituted
The place of supply of goods or service shall be determined as per Section 5 & Section 6 of IGoods and Service Tax (GST) Act. Please refer chapter No.__ for detailed discussion.
As per section 2(48), “Goods means every kind of movable property other than actionable claim and money and it includes securities, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under the contract of supply. “Movable property” shall not include any intangible property.
The definition of Goods is same as existed in Finance Act, 1994.
As per Section 2(88) “Services” means anything other than goods and it includes intangible property and actionable claim but does not include money.
From the definition of Goods and Service, it is clear that actionable claim and intangible property is a service and money is neither a good nor a service. Therefore the long-lasting dispute of whether “Software is a good or service is resolved by expressly defining intangible property as a service.
The rate of Goods and Service Tax (GST) will be specified in Schedule ____. There may be different rates for Goods and Services, different rates for different goods and different services. The Central Government /State Government may levy Goods and Service Tax (GST) at a concessional rate on specified Goods and Services.
As per Section 3 of CGoods and Service Tax (GST) Act, 2016 Supply includes
A. all forms of supply of goods and services such as i. Sale
made or agreed to be made for a consideration by a person in the course or furtherance of business.
B. Importation of service, whether or not for a consideration and whether or not in the course or furtherance of business. This implies that import of services even for personal consumption would qualify as “supply” and therefore would be liable to tax, subject to the threshold limit. Amongst others, such services would be liable to tax under reverse charge mechanism.
C. supplies made or agreed to be made without a consideration which is specified in Schedule I
D. transactions between principal and agent who supplies or receives any goods and or services on behalf of principal
E. Supply of any branded service by an aggregator under a brand name or trade name owned by him shall be deemed to be a supply of said service by the said aggregator.
The law has provided an inclusive meaning to the word “supply” which implies that the specific transaction types which are listed above are only illustrative. It includes goods and/or services. Further, it is essential that such supplies should be made by the supplier who is engaged in business and it should be in the course or furtherance of business.
Supply should be in the course of or furtherance of business: For a transaction to qualify as “supply”, it is essential that the same is “in the course or furtherance of business. This implies that any supply of goods and/or services by a business entity would be liable to tax, so long as it is in the course of or furtherance of business. Supplies which are not in the course of business (or in furtherance of business) will not qualify as “supply” for the levy of tax.
Drawing similarities between the existing State-level VAT laws, it follows that the said transaction should be with a commercial motive, irrespective of whether or not there is a profit in it or its frequency/regularity. For example sale of goods in an exhibition, participation in a trade fair, warranty supplies, supply of free samples, sale of used assets, etc would be in the course of business
Schedule II of CGoods and Service Tax (GST) Act, 2016 has specified certain supplies which are to be treated as a supply of goods and supply of services. In case if any supply falls under Schedule II then such supply should be classified as a supply of good or supply of service as per such schedule. In case if such supplies are not covered under the said schedule the same need to be classified based on the definition of Good and Service as given in Act.
Yes, Supply includes agreed to supply also. Therefore Goods and Service Tax (GST) is required to pay even if the actual supply is not made. Goods and Service Tax (GST) is required to be paid on receipt of advance or issue of an invoice as per the time of supply of goods and services.
Continuous supply of services means a supply of services which is provided or agreed to be provided, continuously or on a recurrent basis, for a period exceeding three months with periodic payment obligations.
It also includes services as may be notified by Central or State Government as continuous supply of services.
a) An individual
b) A Hindu Undivided family
c) A company
d) A firm
e) A limited liability partnership
f) an association of persons or a body of individuals, whether incorporated or not, in India or outside India;
g) any corporation established by or under any Central, State or Provincial Act or a
h) Government company as defined in section 2(45) of the Companies Act, 2013 (18 of 2013);
i) any body corporate incorporated by or under the laws of a country outside India;
j) a co-operative society registered under any law relating to cooperative societies;
k) a local authority;
m) society as defined under the Societies Registration Act, 1860 (21 of 1860);
n) trust; and
o) every artificial juridical person, not falling within any of the preceding sub-clauses;
As compared to the definition of person in case of service tax and central excise they included trust, co-operative society, body corporate incorporated under the laws of a country outside India and AOP or BOI incorporated outside India.
A casual taxable person means a person who occasionally undertakes transactions involving supply of goods and/or services in the course or furtherance of business whether as principal, agent or in any other capacity, in a taxable territory where he has no fixed place of business. For example, a person who occasionally conducts an exhibition in different parts of India who does not have any fixed place of business can be termed as a Casual Taxable person.
A non-resident taxable person means a taxable person who occasionally undertakes transactions involving the supply of goods and/or services whether as principal or agent or in any other capacity but who has no fixed place of business in India.
For example, a non-resident who came to India to participate in an exhibition who undertakes supply of goods or services can be termed as a non-resident taxable person. Even though he has no fixed place of business in India he is required to get registered as a non-resident taxable person to discharge Goods and Service Tax (GST) liability.
The definition of Business” under Goods and Service Tax (GST) has very wide meaning and it is includes
1. any trade, commerce, manufacture, profession, vocation or any other similar activity, whether or not it is for a pecuniary benefit
From this it is clear that business includes even clubs, charitable institutions who work without any pecuniary benefit.
2. any transaction in connection with or incidental or ancillary to (a) above;
3. any transaction in the nature of (a) above, whether or not there is volume, frequency, continuity or regularity of such transaction
Even if the transaction took place for one time the same is treated as business
4. supply or acquisition of goods including capital assets and services in connection with commencement or closure of business;
5. provision by a club, association, society, or any such body (for a subscription or any other consideration) of the facilities or benefits to its members, as the case may be;
6. Admission, for a consideration, of persons to any premises; and
7. Services supplied by a person as the holder of an office which has been accepted by him in the course or furtherance of his trade, profession or vocation
It is clear from the above that the term Business is very vided and covers almost every transaction that takes place in India.
As per Section 2(28) Consideration includes
a. any payment made or to be made in money or otherwise, in respect of supply of goods and/or services
b. the monetary value of any act or forbearance, whether or not voluntary, in respect of, the supply of goods and/or services
whether by the recipient of supply or by any other person but does not include a deposit whether refundable or not, given in respect of supply of goods or services unless such deposit is adjusted towards consideration for supply.
The supply of any service shall be treated as an ?import of service? if the following conditions are satisfied
(a) the supplier of service is located outside India,
(b) the recipient of service is located in India,
(c) the place of supply of service is in India, and
(d) the supplier of service and the recipient of service are not merely establishments of a distinct person
For the purposes of this definition, an establishment of a person in India and any of his other establishment outside India shall be treated as establishments of distinct persons and a person carrying on a business through a branch or agency or representational office in any territory shall be treated as having an establishment in that territory
The following are treated as supply even though there is no consideration
1. Permanent Transfer or disposal of Business Assets which implies that the goods should be transferred without any intention or requirement of having to receive the goods back. Disposal in any other manner (other than as a sale) would qualify as “supply” under this clause. But the essential condition is assets transferred should be business assets.
2. Temporary application of business assets to a private or non-business use: Where any business assets (fixed assets, stock in trade, office equipment, motor vehicles etc.) are put to use by the management or the employees for any personal use (non-business usage), the same would qualify as “supply” and would, therefore, be liable to tax, though there is no consideration which would be paid by such employee or managerial personnel to the business entity.
For example, Person engaged in the leasing of motor vehicles? if he uses the motor cars for the transport of guests on the occasion of a marriage in the family, it would qualify as supply from the business entity to the managerial person who used the motor cars
3. Services put to a private or non-business use: Where any services are provided by the taxable person in the course of his business and if such services are at any time put to use by the management or the employees for any personal use (non-business usage), the same would qualify as “supply” and would therefore be liable to tax, though there is no consideration involved in this transaction. That is captive consumption of services by the employees or managerial personnel within the organization will qualify as “supply”.
For example An architect who is a partner of architect firm designing the house for himself or building complex for his own use would qualify as “supply”.
4. Assets retained after deregistration: In cases where a taxable person deregisters himself (for any reasons, whatsoever) under this Act, the assets which are retained by the entity after such deregistration would qualify as supply. Technically, as a process, such assets should be identified and the taxable person should discharge the tax liability even before applying for deregistration. It is important to note that even when the tax department, deregisters a taxable person suo moto, this clause would be applicable.
5. Supply of goods and / or services by a taxable person to another taxable or non-taxable person in the course or furtherance of business: Any supply of goods and/or services in the course of business or furtherance of business by a taxable person to any other person (whether or not a taxable person) even without consideration would qualify as “supply”. For example; free supplies, samples, gifts etc.
But does not include supply of goods by a registered taxable person to a job-worker in terms of section 43A
Job work means undertaking any treatment or process by a person on goods belonging to another registered taxable person and the expression job worker shall be construed accordingly
The following shall be treated as supply of Goods
1. Any transfer of the title in goods
2. Any transfer of title in goods under an agreement which stipulates that property in goods will pass at a future date upon payment of full consideration as agreed
3. Transfer or disposal of business assets by or under the directions of the person carrying on the business whether or not for a consideration
4. Transfer of business assets of taxable person by any other person who has the power to do so to recover any debt owed by the taxable person and shall be deemed to be supplied by the taxable person in the course or furtherance of his business
5. Where any person ceases to be a taxable person, then the business assets shall be deemed to be supplied by him in the course or furtherance of his business immediately before he ceases to be a taxable person, unless?
i. the business is transferred as a going concern to another person; or
ii. the business is carried on by a personal representative who is deemed to be a taxable person
6. Supply of goods by any unincorporated association or body of persons to a member thereof for cash, deferred payment or other valuable consideration.
The following shall be treated as Supply of Services
1. Any transfer of goods or of right in goods or of undivided share in goods without the transfer of title thereof
2. Any lease, tenancy, easement, licence to occupy land
3. Any lease or letting out of the building including a commercial, industrial or residential complex for business or commerce, either wholly or partly
4. Any treatment or process which is being applied to another person”s goods
5. Goods held or used for the purposes of the business are put to any private use or are used, or made available to any person for use, for any purpose other than a purpose of the business, whether or not for a consideration, the usage or making available of such goods shall be treated as Supply of service
6. Renting of immovable property;
7. Construction of a complex, building, civil structure or a part thereof, including a complex or building intended for sale to a buyer, wholly or partly, except where the entire consideration has been received after issuance of completion certificate, where required, by the competent authority or before its first occupation, whichever is earlier.
8. Temporary transfer or permitting the use or enjoyment of any intellectual property right;
9. Development, design, programming, customization, adaptation, upgradation, enhancement, implementation of information technology software;
10. Agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act;
11. Works contract including transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract;
12. Transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; and
13. Supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration.
“Agent” means a person who carries on the business of supply or receipt of goods and/or services on behalf of another, whether disclosed or not and includes a
iii. commission agent,
v. del credere agent,
vi. intermediary or
vii. an auctioneer or any other mercantile agent,
by whatever name called, and whether of the same description as hereinbefore mentioned or not.
In Goods and Service Tax (GST) even the transaction between the principal and agent is to be treated as Supply and Goods and Service Tax (GST) is required to be paid on a supply of goods by a principal to the agent.
Principal means a person on whose behalf an agent carries on the business of supply or receipt of goods
“Aggregator” means a person, who owns and manages an electronic platform, and by means of the application and a communication device, enables a potential customer to connect with the persons providing service of a particular kind under the brand name or trade name of the said aggregator.
When compared to the definition of aggregator under Service Tax Rules, 1994, the definition under Goods and Service Tax (GST) is modified to replace the words ” a web based software application” with “electronic platform”
Brand Name or Trade Name” means, a brand name or a trade name, whether registered or not, that is to say, a name or a mark, such as an invented word or writing, or a symbol, monogram, logo, label, signature, which is used for the purpose of indicating, or so as to indicate a connection, in the course of trade, between a service and some other person using the name or mark with or without any indication of the identity of that person;
Branded Services” means services which are supplied by an electronic commerce operator under its own brand name or trade name, whether registered or not
Electronic commerce operator shall include every person who, directly or indirectly, owns, operates or manages an electronic platform that is engaged in facilitating the supply of any goods and/or services or in providing any information or any other services incidental to or in connection there with but shall not include persons engaged in supply of such goods and/or services on their own behalf
Taxable Person means a person who carries on any business at any place in India /State of ____ and who is registered or required to be registered under Schedule III of this Act but does not include an agriculturist. A person who is required to be registered on his aggregate turnover exceeds 9 lakhs or 4 lakhs as the case may be shall not be considered as taxable persons unless their aggregate turnover exceeds 10 lakhs or 5 lakhs.
Agriculturist means a person who cultivates land personally, for the purpose of agriculture.
Agriculture includes floriculture, horticulture, sericulture, the raising of crops, grass or garden produce and also grazing but does not include dairy farming, poultry farming, stock breeding, the mere cutting of wood or grass, gathering of fruit, raising of man-made forest or rearing of seedlings or plants.
The definition of agriculture under Finance Act, 1994 includes rearing of all life-forms of animals except rearing of horses. Therefore rearing of all life-forms of animals including rearing of horses shall be treated as supply.
Refer Chapter_ for details
Yes, the Central Government, a State Government or any local authority shall be regarded as a taxable person in respect of activities or transactions in which they are engaged as public authorities other than the activities or transactions as specified in Schedule IV to this Act.
1. Services provided by a Government or local authority to another Government or local authority excluding the following services:
i. services by the Department of Posts by way of speed post, express parcel post, life insurance and agency services;
ii. services in relation to an aircraft or a vessel , inside or outside the precincts of a port or an aircraft; or
iii. Transport of goods or passengers.
Therefore the Government or local authority shall be treated as taxable person with respect to above referred services and is required to be registered and liable to pay Goods and Service Tax (GST)
2. Services provided by a Government or local authority to individuals in discharge of its statutory powers or functions such as-
i. issuance of passport, visa, driving licence, birth certificate or death certificate; and
ii. Assignment of right to use natural resources to an individual farmer for the purpose of agriculture.
3. Services provided by a Government or local authority or a governmental authority by way of:
i. any activity in relation to any function entrusted to a municipality under article 243 W of the Constitution;
ii. any activity in relation to any function entrusted to a Panchayat under article 243 G of the Constitution;
iii. health care; and
4. Services provided by Government towards-
i. diplomatic or consular activities;
ii. citizenship, naturalization and aliens;
iii. admission into , and emigration and expulsion from India;
iv. currency , coinage and legal tender , foreign exchange;
v. trade and commerce with foreign countries , import and export across customs frontiers , interstate trade and commerce; or
vi. maintenance of public order.
5. Any services provided by a Government or a local authority in the course of discharging any liability on account of any tax levied by such Government or authority
6. Services provided by a Government or a local authority by way of –
i. tolerating non-performance of a contract for which consideration in the form of fines or liquidated damages is payable to the Government or the local authority under such contract; or
ii. assignment of right to use any natural resource where such right to use was assigned by the Government or the local authority before the 1st April, 2016
7. Services provided by Government by way of deputing officers after office hours or on holidays for inspection or container stuffing or such other duties in relation to import or export of cargo on payment of Merchant Overtime Charges (MOT).
8. Services provided by Government or a local authority by way of-
i. registration required under any law for the time being in force; or
ii. testing, calibration, safety check or certification relating to protection or
iii. safety of workers, consumers or public at large, required under any law for the time being in force.
Governmental Authority means a board, or an authority or any other body
1. established with 90% or more participation by way of equity or control by Government and
2. set up by an Act of the Parliament or a State Legislature
to carry out any function entrusted to a municipality under article 243W or a Panchayat under article 243G of the Constitution.
When compared to the definition of Governmental authority under Mega exemption Notification under Services tax, Goods and Service Tax (GST) extended the definition to Panchayat under article 243G of the Constitution
Health care services means any service by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognized system of medicines in India and includes services by way of transportation of the patient to and from a clinical establishment, but does not include hair transplant or cosmetic or plastic surgery, except when undertaken to restore or to reconstruct anatomy or functions of body affected due to congenital defects, developmental abnormalities, injury or trauma.
The definition of Healthcare services is same as given under Mega Exemption notification under service tax. But as per mega exemption notification Health care services provided by a clinical establishment is exempted but under Goods and Service Tax (GST) only the health care services provided by Government is exempt.
Education services means services by way of?
1. pre-school education and education up to higher secondary school or equivalent;
2. education as a part of a curriculum for obtaining a qualification recognized by any law for the time being in force; or
3. Education as a part of an approved vocational education course.
In case if the employee is providing services to his employer in the course or in relation to his employment or by any other legal ties creating the relationship of employer and employee as regards working conditions, remunerations and employer”s liability then he shall not be considered as a taxable person and he is not required to discharge Goods and Service Tax (GST).
No. in case if any person is engaged in the business of exclusively supplying goods and /or services that are not liable to tax under this Act,
No, he is not required to discharge Goods and Service Tax (GST) under RCM in case if value of such services does not exceed Rs.___________ and such services shall not be used in the course or furtherance or his business
As per charging section Reverse Charge is applicable for specified supply of both goods and/or services. Prior to Goods and Service Tax (GST) regime Reverse Charge is applicable only with respect to certain services and it is not applicable to goods.
The supplies on which tax is payable on reverse charge basis is not specified in Act. The Central Government or State Government may, on the recommendation of the council, by notification will specify categories of supply of goods and/or services which are covered under Reverse Charge basis.
Composition scheme is the scheme under which a taxable person can pay tax at a fixed rate on turnover instead of payment under regular scheme. Tax payment under this scheme is an option available to the registered taxable person. This scheme would be applicable only to taxable person whose supplies are restricted to a particular State. This scheme may be opted for by taxable persons, for supply of goods and / or services. It must be noted that a taxable person cannot opt for payment of taxes under composition scheme say for supply of goods and opt for regular scheme of payment of taxes for supply of services.
It is important to note that for any tax payable under reverse charge mechanism, the option of payment under this scheme will not be available.
A registered taxable person whose aggregate turnover in a financial year does not exceed 50 lakhs rupees is eligible to pay Goods and Service Tax (GST) under composition scheme. This scheme is available only after satisfying the following conditions
1. The taxable person should make an application exercising his option to pay tax under this scheme. Once granted, the eligibility would be valid unless his permission is cancelled under law or he becomes ineligible
2. The taxable person shall not effect inter-state supplies of goods and /or services
3. The proper officer of Central or State Government should permit the taxable person
4. The taxable person shall opt to pay under composition scheme for all his registered taxable persons, having the same PAN as held by the said taxable person
5. The taxable person shall not collect any tax from the recipient of supplies nor shall be entitled to any credit of input tax.
The tax shall be payable at such rate as may be prescribed but shall not be less than 1% of the turnover during the year.
The taxable person is liable to pay a penalty equivalent to the amount of tax payable by him under other provisions of this act. No such penalty shall be imposed without giving a show cause notice and without affording a reasonable opportunity of being heard.
Aggregate turnover means the aggregate value of all
> taxable supplies
> non-taxable supplies,
> exempt supplies and
> exports of goods and/or services of a person having the same PAN to be computed on all India basis and
i. taxes, if any, charged under the CGoods and Service Tax (GST) Act, SGoods and Service Tax (GST) Act and the IGoods and Service Tax (GST) Act, as the case may be
ii. the value of supplies on which tax is levied on reverse charge basis and the value of inward supplies.
Exempt supply means supply of any goods and/or services which are not taxable under this Act and includes such supply of goods and/or services which are specified in Schedule . . . of the Act or which may be exempt from tax under section 10.
Zero-rated supply means a supply of any goods and/or services on which no tax is payable but a credit of the input tax related to that supply is admissible. Exports shall be treated as zero-rated supply.
A supply is treated as export of supply if the goods are taken out of India to a place outside India.
A service is treated as export of service if the following conditions are satisfied
a. the supplier of service is located in India,
b. the recipient of service is located outside India,
c. the place of supply of service is outside India,
d. the payment for such service has been received by the supplier of service in convertible foreign exchange, and
e. the supplier of service and recipient of service are not merely establishments of a distinct person. An establishment of a person in India and any of his other establishment outside India shall be treated as establishments of distinct persons.