UPDATES / PRESS RELEASES :
Dated : 15th July, 2017
PRESS RELEASE :
MINISTRY OF FINANCE
Advocates
legal serices covered under GST
Position
regarding applicability of GST on Legal Services provided by individual
Advocates including Senior Advocates and a Firm of Advocates.
There are points being raised about the applicability of GST on
legal services provided by advocates – whether it is in forward charge or
reverse charge. It may be mentioned that there is no change
made in taxation of legal services in the GST era.
In this context, it is further clarified that legal service has been defined to mean any service provided in relation to advice, consultancy or assistance in any branch of law, in any manner and includes representational services before any court, tribunal or authority.
It is further clarified that notification No. 13/2017-Central Tax (Rate) dated 28.6.2017 (Serial
No. 2)specifies, inter alia, the following service under reverse
charge mechanism,-
“Services supplied by an individual advocate including a senior advocate by way of representational services before any court, tribunal or authority, directly or indirectly, to any business entity located in the taxable territory, including where contract for provision of such service has been entered through another advocate or a firm of advocates, or by a firm of advocates, by way of legal services, to a business entity.”
“Services supplied by an individual advocate including a senior advocate by way of representational services before any court, tribunal or authority, directly or indirectly, to any business entity located in the taxable territory, including where contract for provision of such service has been entered through another advocate or a firm of advocates, or by a firm of advocates, by way of legal services, to a business entity.”
The words “by way of legal services” are preceded and succeeded by comma. Therefore, the said words apply to an individual advocate including a senior advocate and a firm of advocates. Legal services provided by either of them are liable for payment of GST under reverse charge by the business entity. The words “by way of representational services before any court, tribunal or authority….” appear in conjunction with senior advocate without a comma and merely describe the nature and mode of representational services provided by a senior advocate to a business entity. It, therefore, follows that legal services, which includes representational services, provided by advocates are under reverse charge.
press release can be access at : http://pib.nic.in/newsite/erelease.aspx issued by Ministry of finance dated 15th July, 2017.
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