Services provided to foreign company - Export or Local Sales

[vishwanath shetty]

Dear Experts, 

Foreign company engaged Indian company to coordinate and manage various aspects of its international summits and awards. the scope includes, activities such as content development, Secretariat, handling administration, finance, communications, and media engagement, confirming speakers, managing sponsorship, registrations, logistics and also coordinates all working groups and key programme. 

Indian company collects registration fess from participates of event (generally being foreign person) and pay back to foreign company.

Indian company issued Invoices to participates of event. 

Will this be qualified as export in GST?

[KALLESHAMURTHY MURTHY K.N.]

Sir, 

GST is a destination-based law. Since the event was conducted in India, although the services provided by foreign companies are domestic supplies of services, it cannot be an export of services, even if the payment goes to the foreign company. The determining factor here is the place of supply where the service is consumed, not the location of the recipient of the payment. 

Since the service provider is located outside India, the Indian Company, being a recipient of services that collects fees for arranging events, is required to collect IGST and pay under the Reverse Charge Mechanism and can avail ITC on such payment.

 This is my view only and not to be considered as a legal opinion.

[Rajan Kumar and associates]

Place of supply will be the location of the event, if it is located in outside the Indian territory. Yes, it will be considered as Export of Service. 

- Aivar

[Sadanand Bulbule]

Where the Indian company provides event coordination and management services to a foreign company in respect of an event held outside India, the place of supply, as per Section 13(5) of the IGST Act, 2017, lies outside India, thereby satisfying the conditions of “export of services” under Section 2(6) of the Act and qualifying as a zero-rated supply.

However, if the event is held within India, the place of supply is India, and the transaction does not qualify as export, being liable to IGST.

[Shilpi Jain]

Terms of the agreement would be relevant to see what is the services provided. Relevant place of supply provision is

The place of supply of services supplied by way of admission to, or organisation of a cultural, artistic, sporting, scientific, educational or entertainment event, or a celebration, conference, fair, exhibition or similar events, and of services ancillary to such admission or organisation, shall be the place where the event is actually held.

AI Summary

Event management services: export treatment depends on where the event is held and the place-of-supply rules.
Place of supply rules determine export treatment: if the event occurs outside India the place of supply is outside India and the service qualifies as export of services and zero-rated; if the event occurs in India the place of supply is India and the service is taxable. Contract terms and whether services are admission, organisation, or ancillary to events affect the place-of-supply analysis. Where the provider is located outside India but services are consumed in India, reverse charge may apply and input tax credit may be available.