Service rendered to foreign company

[Asked by Guest]

I have a query where one Indian company is serving a foreign company as an agent for procuring goods from overseas and selling the goods to India, the outgoing payment and incoming payment is effected to the foreign company and the Indian company is charging services in respect to the buying and selling arrangement.

Is the Indian company liable to charge gst on such services or not since the service is export oriented being served to a foreign entity in foreign currency without any value addition of the goods in India or anywhere.

AI Summary

Intermediary services where place of supply is the supplier's location are taxable under GST, not export of service.
The transaction is characterised as intermediary services: an Indian agent arranging purchases and sales for a foreign principal without taking ownership. Under IGST Act section 13(8)(b) the place of supply for intermediary services is the location of the supplier; with the supplier in India the place of supply is India. Export of services under section 2(6) requires the place of supply to be outside India and other cumulative conditions; mere receipt of foreign exchange and cross border movement of goods do not alone make the agent's commission an export of service.