GST on intermediary service

[Kavali Ramanjeneyulu]

One Indian Company is a subsidiary company of a Singapore company . Singapore company manufactures Pharmaceutical packaging products and sells in India. Indian company provides marketing services like obtaining purchase orders / sales requirements from the Indian customers and forwarding the same to Singapur Company, Pursuing payments from the Indian Customers and coordinating to settle issues between the Singapore Company and Indian Customers. For providing this activity, the Indian Company receives consideration in foreign currency on the basis of Operating cost + Mark up i.e 100+15% every month. The Indian Company has provided the above service under LUT claiming it as export of service. In this request , I request clarification on the following query.

1. Since the Indian Company is located in India and providing marketing services to Singapore Holding company, whether it can be considered as Intermediary?

2. If the Indian Company is considered as Intermediay , whether it is liable to pay GST on the marketing services as both Location of service provider and place of supply fall in India ?

Please provide clarification along with legal provisions and any Advance Rulings/case laws .

AI Summary

Indian Subsidiary's Marketing Services Deemed Intermediary, Liable for GST Under IGST Act 2017, Despite Foreign Currency Payment An Indian subsidiary of a Singapore company provides marketing services in India for its parent company, including obtaining purchase orders and coordinating with Indian customers. The Indian company receives payment in foreign currency and claims this as an export of service under the Letter of Undertaking (LUT). The query seeks clarification on whether these services classify as intermediary services and if GST applies, given the service location and supply place are in India. Responses indicate that the Indian company is considered an intermediary under the IGST Act, 2017, and is liable to pay GST on services rendered within India. Some replies reference legal rulings to argue that the services could be considered exports, but prevailing interpretations suggest GST liability.