Impact of GST on Service Provided in Third Country

[Lokesh Kumar]

This year in the month of April I went to Belgium to attend a trade show, there I met an exporter from Cuba and introduced them to an importer in Taiwan. The Cuban exporter has started shipping cargo directly to the Taiwanese importer.

The Taiwanese importer has committed to pay us USD 2500 per consignment for introducing them to the Cuban exporter. Will there be any GST on the payment which we may receive on such transactions?

Kindly note the following:

• Exporter is from Cuba: Not in India
• Importer is from Taiwan: Not in India
• Service provided in Belgium: Not in India
• Money received: In US Dollar in India

[KASTURI SETHI]

Not taxable.

[DR.MARIAPPAN GOVINDARAJAN]

In my view it is taxable since you are having place in India and you receive the commission in India. Experts views are solicited.

[Guest]

Under the provisions of IGST, the place of supply in case of intermediary is considered to be the location of the service provider, which in your case is in India and hence taxable.

[Ganeshan Kalyani]

The service is not provided from India. The service of introducing the parties happened out of taxable territory. Only payment is being received in India. In what way it will be considered as service provided in India. I agree with Sri Kasturi Sir. It is not taxable.

[KASTURI SETHI]

Here place of Supply is outside India and not in India. Only foreign currency received in India. Definitions of place of Supply in IGST Act are at variance depending upon situation of each case. There is also no intent of Govt. to levy tax on receipt of foreign currency in India. So many factors are involved to arrive at exact place of supply.

[Lokesh Kumar]

Thank you sir

[KASTURI SETHI]

'Consideration' cannot be treated as 'Supply' and vice versa. Both have separate legal status/definitions.

[Ganeshan Kalyani]

Sri Mariappan Sir, i agree with you from an Income Tax point of view. Thanks.

AI Summary

Debate on GST applicability for commission from Cuban-Taiwanese trade connection: Is the transaction taxable under IGST Act? A discussion on the applicability of Goods and Services Tax (GST) to a commission received in India for facilitating a trade connection between a Cuban exporter and a Taiwanese importer during a trade show in Belgium. Opinions vary: some argue the transaction is not taxable as the service was provided outside India, while others contend it is taxable since the service provider is based in India and receives payment there. The debate highlights differing interpretations of the IGST Act regarding the place of supply and the nature of the transaction.