Export of services: outsourced foreign input treated as import of services, reverse-charge IGST payable and creditable. An Indian supplier outsourcing part of export services to a foreign supplier creates two supplies: export of services by the Indian supplier for the full contract value and import of services by the Indian supplier for the outsourced portion. The Indian supplier must pay IGST on the imported portion under reverse charge and may claim input tax credit. If RBI permits retention of part of consideration abroad and IGST on the imported portion is paid, the full contract value can be treated as export despite direct payment to the foreign supplier.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Export of services: outsourced foreign input treated as import of services, reverse-charge IGST payable and creditable.
An Indian supplier outsourcing part of export services to a foreign supplier creates two supplies: export of services by the Indian supplier for the full contract value and import of services by the Indian supplier for the outsourced portion. The Indian supplier must pay IGST on the imported portion under reverse charge and may claim input tax credit. If RBI permits retention of part of consideration abroad and IGST on the imported portion is paid, the full contract value can be treated as export despite direct payment to the foreign supplier.
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