??Desk of CA. Praveen Sharma Series-605?? DELHI HIGH COURT COURT IN THE CASE OF Metal One Corporation India Pvt.

?These writ petitions challenge Show Cause Notices (SCNs) issued under the CGST Act, 2017, regarding tax liability on services supplied via seconded foreign employees to Indian entities. Initially, petitioners contested the existence of seconded employees but later focused on CBIC's clarifications. The SCNs demanded IGST, interest, and penalties for services received from overseas under the Reverse Charge Mechanism (RCM) from July 2017 to March 2023.

?The respondents, referencing Supreme Court's decision in CCE & Service Tax vs. Northern Operating Systems (P) Ltd. (2022), argued that secondment qualifies as manpower supply. Petitioners cited Rule 28 of CGST Rules, emphasizing that full Input Tax Credit (ITC) eligibility should mean that declared invoice values are deemed market value, per CBIC's Circular No. 210/4/2024-GST.

?The court observed that no invoices were issued for secondment, making the value "Nil" under Rule 28. Thus, no further tax liability arises. The court quashed the SCNs, including associated Orders-in-Original, while clarifying that only issues regarding seconded employees were addressed. Other SCN issues remain open for adjudication.

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CA. Praveen Sharma