TaxTMI 
TaxTMI 
2019 (10) TMI 670
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....he applicant to the Juniper Inc. under the agreement would be classified as 'Support Services' under the Tariff Heading 9985 of Notification 11/2017 - Central Tax (Rate) dated 28.06.2017? b) Whether the services in question would be treated as Intermediary services or not? 3. The applicant furnishes some facts relevant to the stated activity: a. The applicant states that he is in the business of providing back-end support services to its various clients. b. As a part of its business, the applicant states that he has entered into a Trade Compliance Services ("the agreement") with Juniper Networks Inc., an entity located in the USA (hereinafter referred to as 'Juniper Inc.) which lays down terms of various services to be provided by the applicant. The Statement of Work ('SOW) attached to the Agreement details the various services to be provided by the applicant. As per the SOW, the applicant mainly provides the services of Trade Compliance Operations Management (involving assistance and support for export compliance, import compliance, manual documentation preparation, etc.) and miscellaneous administrative support (involving responding to request for hi....
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....ant extract of the said Annexure is reproduced hereunder: Sr.No. Chapter, Heading, Group Service Code Description 400 Heading 9985 Support Services 444 Group 99859 Other Support Services 448 998594 Combined Office Administrative Services 998595 Specialised office support services such as duplicating services, mailing services, document preparation and the like 453 998599 Other support services not specified elsewhere In addition to above, the applicant also refers to Explanatory notes as released by Central Board of Indirect Taxes and Customs (CBIC) which indicates the scope and coverage of the Heading, Groups and Service Codes of the Scheme of Classification of Services. The relevant extracts of the same is reproduced hereunder: 998594 - Combined Office Administrative Services This service includes provision of a combination of day to day office administrative services, such as reception, financial planning, billing and record keeping, personnel and mail services etc. for others on contract basis. 998595 - Specialised Office Support Servic....
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....as per Section 2(30) of the CGST Act or otherwise, the principal supply in respect of the activities in question would be 'Support Services' only, since all the activities undertaken under the agreement are also in the nature of 'Support Services' on a standalone basis. i. Further, the applicant highlights that the said services provided under the agreement are not in the nature of an 'intermediary'. The term 'intermediary' is defined under Section 2(13) of IGST Act. The definition of intermediary is reproduced hereunder. Section 2(13) of IGST Act - 'Intermediary' means a broker, an agent or any other person, by whatever name called, who arranges or facilitates the supply of goods or services or both, or securities, between two or more persons, but does not include a person who supplies such goods or services or both securities on his own account'. j. In this regard, the applicant highlights the following facts as per the terms of the agreement: i. Services provided by the applicant to Juniper Inc (service recipient) is on a principal-to-principal basis; ii. The services in question are supplied by the applicant to Juniper Inc. on its ow....
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....stwhile regime wherein it was held that where services are provided on principal to principal basis, the said services would qualify as main service, not intermediary service. Global Transportation Services Pvt Ltd. [2016 (45) STR 574 (AAR)] = 2016 (9) TMI 291 - AUTHORITY FOR ADVANCE RULINGS - This service agreement would be on principal to principal basis and not as agent of said airline/ shipping lin. Therefore, applicant would be covered by the exclusion clause, i.e. provides the main service - inbound and outbound shipment on his own account in terms of Rule 2(f) of POP rules and thus not covered under Rule 9(c) ibid as "intermediary service" GoDaddy India Web Services Pvt Ltd [2016 (46) STR 806 (AAR)) = 2016 (3) TMI 355 - AUTHORITY FOR ADVANCE RULINGS the applicant is providing business support service such as marketing and other allied services like oversight of quality of third party customer care centre operated in India and payment processing services, on behalf of GoDaddy US. Therefore, these services provided by the applicant to GoDaddy US cannot be categorized as intermediary services. Universal Services India Pvt Ltd [91 VST 483 (AAR)] ....
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....ices for the benefit of Juniper Networks as the parties may agree from time to time (the "Services"). The Services will be provided in accordance with the written Statements of Work ("SOW") agreed to between the parties. The applicant and Juniper Networks shall jointly determine and identify each party's roles for each set of services set forth in an SOW. (b) The applicant is and shall remain an independent contractor and not an employee of Juniper Networks. Except as specifically provided in this agreement, nothing in this agreement shall either be render, or be interpreted or construed to mean that the parties are partners, joint venturers, trustee/ beneficiary, employer/employee or principal/ agent of the other. Except as specifically provided in this agreement, neither party shall have any authority whatsoever to obligate or commit the other party, contractually or otherwise, and neither party shall so anything whatsoever to represent to any person that they have any authority to so obligate to commit the other party. (c) The applicant acknowledges that they have not authority to enter into and the applicant agrees not to enter into any contract incur any liab....
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....cant is responsible to manually intervene into such transactions and take necessary actions based on guidelines provided by Juniper as per agreed SLA. iii. Shipment Screening: As per the business logic on TradeSphere application, any transaction which should not be PASSED automatically by the system is kept on HOLD and for all such transactions, an alert is sent to the applicant directly from the TradeSphere application. The applicant is responsible to manually intervene into such transactions and take necessary actions based on guidelines provided by Juniper as per agreed SLA. iv. Shipping documents: Juniper revenue shipments are booked in Oracle by Juniper Order Management team and this information flows to TradeSphere application automatically. As a process, the applicant receives from Juniper contracted manufacturers and/or freight forwarders for shipping documents. The applicant is responsible for the accuracy of the compliance information on the shipping documents and to fulfill the document request of the manufacturer/ freight forwarder as per agreed SLA. v. Web Registration: As per the business decision by Juniper, all individuals / companies who ....
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....ocess the requests within the agreed SLA. ii. Demo Loan Shipping Documents: Juniper has provided guidelines to the applicant on preparing the shipping documents for Demo Loan shipments. The applicant is responsible to prepare the documents based on the destination country and relevant compliance parameters to be used for such transactions as instructed by Juniper. iii. Mailroom Shipping Documents: Juniper is yet to provide guidelines to the applicant on preparing the shipping documents for mailroom shipments (shipments between Juniper offices with non-Juniper products). Once trained, the applicant will be responsible to prepare the documents based on the destination country and relevant compliance parameters to be used for such transactions as instructed by Juniper. iv. Hong Kong Declaration documents: Juniper has assigned the responsibility to the applicant to prepare the documentation for declaration purposes at Hong Kong Customs. The applicant is responsible to prepare two sets of documents (import into Hong Kong and export out of Hong Kong) for each shipment which physically transit through Hong Kong. v. Accton Shipping documents: Juniper has....
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.... Out: Juniper has trained the applicant to perform the serial number back out process on its Oracle application. The applicant will be responsible to perform the assigned task based on the guidelines provided by Juniper. e. SSUI: Exception Handling (payments): Juniper has a pre-defined approach to clear its financial dues to its service providers. All service providers have to go through a payment screening gateway controlleß by a outsourced service provider called Software Solutions Unlimited Inc (SSUI). Through this payment channel, all payments which have a genuine Juniper GL code will get through and the payment will be processed. The ones which do not have a pre-coded GL Code will be on hold. Juniper has trained Fulcrum on how to handle such exceptions and the applicant will be responsible to clear the outstanding payments based on the knowledge imparted by Juniper. (h) Regarding the administrative tasks the process related ad-hoc requests are placed by the management team at Juniper to the applicant. Some examples of such requests are listed in the agreement: a. Web Registration mass update of back-end data which triggers a spike in volume on ....
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....edite, forward, foster, free from difficulty, free from hindrance, free from impediment, free from obstruction, further, give clearance, hasten, help, lend a hand, lessen the labor, lift a ban, lighten, make a path for, make easy, make possible, open the way for, pave the way, promote, push forward, quicken, rem faciliorem reddere, render a task easier, render assistance, render less difficult, simplify, smooth, speed up In terms of the Statement of work, it is seen that the applicant is engaged in providing the services themselves. In other words there is no third person involved in providing services to Juniper or receiving from juniper where the applicant may have acted as the go in between. The applicant is thus not involved as an intermediary in terms of the contents of the statement of work provided by the applicant. 4.5 The issue under question is whether the services provided by the applicant to Juniper Inc would be classifiable as "Support Services" under the Tariff Heading 9985 of Notification No. 11/2017 - Central Tax (Rate) dated 28.06.2017. The nature of the service supplied by the applicant is verified and found that the applicant is providing the services which....