2026-VIL-333-KAR
  1. Home
  2. 2026-VIL-333-KAR

SGST High Court Cases

GST - Nature of employment of pigmy agents, Scope of "business facilitator model" - Petitioner-Bank engaged pigmy agents to collect small deposits (pigmy deposits) from the customers. The petitioner contended that the pigmy agents are employees of the Bank and hence their services are exempt from GST under Section 7(2)(a) read with Schedule III of the CGST Act – Dept issued show cause notices alleging that the pigmy agents are "business facilitators" and hence the Bank is liable to pay GST on the commissions paid to them under the reverse charge mechanism - Whether the pigmy agents engaged by the petitioner Bank can be considered as employees of the Bank, and hence their services are exempt from GST, or whether they are "business facilitators" and the Bank is liable to pay GST on the commissions paid to them - HELD - The pigmy agents engaged by the petitioner Bank are employees of the Bank and not "business facilitators". The determinative factor in an employment relationship is the degree of control exercised by the employer over the manner in which the work is performed, the economic dependence of the worker on the employer, and the integration of the worker into the employer's business - The terms of the agreement between the Bank and the pigmy agents clearly demonstrate the existence of an employer-employee relationship, as the Bank exercises pervasive control over the functioning of the pigmy agents, assures them minimum remuneration, and provides them with benefits such as gratuity. The definition of "business facilitator" under the Notification No. 13/2017-Central Tax (Rate) and Notification No. 29/2018-Central Tax (Rate) dated 31-12-2018 does not encompass the pigmy agents, as they are not intermediaries appointed under the Reserve Bank of India's recognized models. Consequently, the services rendered by the pigmy agents to the petitioner Bank are in the course of their employment and are exempt from GST under Section 7(2)(a) read with Schedule III of the CGST Act, 2017. The impugned show cause notices are quashed and set aside – The writ petitions are allowed
Download File
show more Judgements  

Quick Search

/

Advance Search

GST Resources

/

Gst Rate Finder

Tax Vista

Your Weekly Tax Recap

By Kasi Viswanathan V

Weekly Summary

VIL Video

Changes in GST, IT & Cuss w.e.f. 1 Apr
By CA Vivek Jalan

Create Account

Security-Code
New Code?

Log In

New User ? Forgot Password ?

Forgot Password

Security-Code
New Code?
Please Note: This facility is only for Subscribing Members.

Email this page

Feedback this page

Schedule a Demo

Schedule a demo to know the features and advantages of VILGST portal. Get to know the tips to find the desired results in faster way.

Caselaw Request Form (CRF)

Didn’t find what you are searching for? No worries, please give us the following details and VIL will email you the desired Caselaws at the earliest:

Security-Code
New Code?