2026-VIL-52-BOM
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SGST High Court Cases

GST - Export of services by subsidiary company or Intermediary, Location of supply of services – Petitioner is a subsidiary to foreign entity provides information system products and services to customers based on software licenses of 'SAP'. The petitioner filed refund applications for unutilized input tax credit, claiming that the services provided to its parent company qualify as 'export of services' - The Assistant Commissioner initially sanctioned the refund, but the Principal Commissioner and the Joint Commissioner, CGST, on appeal, rejected the refund claim on the ground that the petitioner was acting as an agent/intermediary of its parent company - Whether the services provided by the petitioner to its parent company qualify as 'export of services' under the IGST Act, entitling the petitioner to a refund of unutilized input tax credit – HELD - Although the appellate authority had considered certain clauses of the service agreement between the petitioner and its parent company, in light of the decision in Sundyne Pumps and Compressors India Pvt. Ltd. v. Union of India and the applicability of the relevant circulars, the matter would require appropriate examination by the appellate authority on all the points urged on behalf of the petitioner - The Division Bench in Sundyne Pumps had examined the terms of the agreement and concluded that the petitioner therein was not acting as an agent of the parent company. Further, the Circulars issued by the CBIC clarified that transactions between sister/group companies or holding/subsidiary companies are not covered under the definition of 'intermediary' under the IGST Act - Considering the different clauses of the service agreement, the issues require a deeper scrutiny and examination by the appellate authority. The impugned order is set aside and the matter is remanded to the appellate authority for a de novo consideration – The petition is disposed of
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