Type of GST payable

[Kaustubh Karandikar]

As per the decision of the Mumbai High Court which states in its order on Page 113:-

“The provisions of Section 13(8)(b) and Section 8(2) of the IGST Act are legal, valid and constitutional, provided that the provisions of Section 13(8)(b) and Section 8(2) are confined in their operation to the provisions of IGST Act only and the same cannot be made applicable for levy of tax on services under the CGST and MGST Acts”. As per the provision of IGST Act, the GST payable is to be paid under IGST as per my understanding. Does the order confirm that the GST payable by the intermediary located in India for supplies made to its customer outside India is to be paid under ‘IGST’ or does it confirm that the GST payable is under ‘CGST+SGST’? Need valuable guidance in the matter

AI Summary

Place of supply rules: intermediary services to foreign recipients create uncertainty between IGST and CGST+SGST applicability.
The core issue is whether intermediary services supplied by an Indian intermediary to a recipient outside India attract tax under IGST or under CGST plus SGST, arising from contested readings of Section 13(8)(b) and Section 8(2) of the IGST Act. A three judge bench produced divergent reasonings, with at least one view confining those IGST provisions to the IGST Act and indicating they cannot be invoked to levy CGST and SGST; the split has left interim uncertainty and prompted suggestions to challenge demands, consider payment under protest, and seek refunds.