2023 (9) TMI 230

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....Section 16 of the Integrated Goods and Services Tax Act, 2017 (hereafter 'the IGST Act'). 2. The petitioner is engaged in the business of providing book keeping, payroll, and accounting services through the use of cloud technology to its affiliated entity (TC Outsourcing Limited, previously known as Boks Business Services Limited) incorporated in the United Kingdom. 3. The petitioner made an application for refund of unutilized input tax credit in respect of the export of services for the tax periods, April 2018 to March 2019 and April 2019 to December 2019, in the requisite form (Form RFD 01). 4. The petitioner received a show cause notice dated 24.06.2020 proposing to reject the petitioner's claim for the refund on the ground tha....

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....d to act as an agent. 7. In view of the above, the Appellate Authority concluded that the petitioner was not a principal service provider to the foreign clients. 8. The principal question to be considered is whether the petitioner can be considered as an "intermediary" within the meaning of Section 2(13) of the IGST Act in the context of the services rendered by it. 9. Undisputedly, the petitioner has rendered services to its foreign affiliate, Boks Business Services Limited, in terms of the agreement dated 12.05.2017. The recitals and clauses 1, 2 and 5 are relevant. The same are set out below: "This Agreement is made on this 12 day of May, 2017 between. M/s. BOKS BUSINESS SERVICES LIMITED incorporated in England and Wale....

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.... a. GBP 3250/- (Fixed) to be paid every month till the period of engagement. b. GBP 500/- per Workstation engaged by the Indian company for completion the work assigned. c. The above fees is subject to review and change with mutual consent from time to time." 10. It is clear from the aforesaid terms, that the petitioner is not an intermediary, inasmuch, as the petitioner is neither facilitating the provision of services by a third entity nor acting as a middleman for procuring such services for its affiliate. The petitioner is, in fact, contracted to provide the services, and is the principal service provider in the context of the services provided by it - book keeping, payrolls, and accounts through the use of cloud t....