Scope of principal and agent relationship under Schedule I of CGST Act, 2017 in the context of del-credre agent.

Principal-agent characterisation determines whether del credre interest is an independent service or part of goods' value.

Whether a del credre agent falls within the ambit of agent under Para 3 of Schedule I depends on invoicing: if the supplier issues the invoice, the DCA is not an agent; if the DCA invoices in his own name, the DCA is an agent. If not an agent, the short term loan by the DCA is an independent supply of services and interest charged is not included in the value of the supplier's goods. If the DCA is an agent, the credit is subsumed into the supply of goods and interest must be included in the value of those goods under section 15(2)(d).