Export of services: outsourced foreign work treated as import subject to reverse charge, enabling full export recognition. An Indian exporter outsourcing part of a services contract to a foreign supplier is treated as supplying the entire contract value to the foreign recipient, while simultaneously importing the outsourced portion; the Indian supplier must pay integrated tax on that imported portion under reverse charge and may claim input tax credit, and the full contract value can be treated as export of services even if part of the payment is made directly overseas provided integrated tax on the outsourced portion has been discharged and the central bank permits retention of payment outside India.
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Provisions expressly mentioned in the judgment/order text.
Export of services: outsourced foreign work treated as import subject to reverse charge, enabling full export recognition.
An Indian exporter outsourcing part of a services contract to a foreign supplier is treated as supplying the entire contract value to the foreign recipient, while simultaneously importing the outsourced portion; the Indian supplier must pay integrated tax on that imported portion under reverse charge and may claim input tax credit, and the full contract value can be treated as export of services even if part of the payment is made directly overseas provided integrated tax on the outsourced portion has been discharged and the central bank permits retention of payment outside India.
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